Eric Knight’s tilt at HSBC was not the only piece of transatlantic shareholder activism kicking off on Friday. Rupert Murdoch also has an irascible thorn in his side in the form of Australian activist shareholder Stephen Mayne.
As the Australian Financial Review observed on Friday:
No matter how irritating people may find Mayne, he raises a valid corporate governance point in respect to News Corp’s two-tier voting structure. Mayne has petitioned for a motion to be put to News shareholders recommending the company abandon its existing capital structure, which conveys preferential voting power to Murdoch, and create a company with just one class of share and one vote per share.
Mayne is what we might call a noisy, micro-activist. After all, he’s a former journalist with precious little in the way of financial firepower.
But one aspect that separates Mayne from your usual small, outrageously vocal, investor is that he appears to be getting somewhere. The SEC last month rejected News Corp’s effort to scrap Mayne’s proposal - and it is now included on News Corp’s agenda for its annual general meeting in New York on October 19. The news actually encouraged a small spike in News Corp’s share price in Sydney on Friday.
Mayne, a former business editor of the (Australian) Daily Telegraph, a Murdoch tabloid, some years ago set up Crikey, an irreverent e-newsletter primarily about corporate and political shenanigans. He sold his Crikey stake in 2005 while maintaining a commentator role, and is now focusing on shareholder activism, having bought the minimum amount of shares in 410 companies worth A$150,000 ($124,000) - what he calls the “world’s biggest small portfolio” - to gain admission to shareholder meetings and grill chief executives.
Among those companies is News Corp, in which Mayne holds 150 shares and has used them to full effect in past years to question Rupert Murdoch on a variety of issues.
Global Proxy Watch, the corporate governance newsletter, reports that Mayne has won a “wide shareowner audience” for his activities. And now he’s reaching across the Pacific—with the aid of America’s own SEC, no less.
After the SEC rejected News Corp’s bid to scrap Mayne’s shareholder resolution calling for an end to the company’s non-voting share structure, his proposal duly appeared on News Corp’s proxy statement filed this week with the SEC for the October 19 AGM in New York.
Mayne of course plans to attend - and in the meantime, to rally proxy advisory firms and media to “get a majority of independent shareholders to support the resolution”, reports Global Proxy. Dual voting rights enable Rupert Murdoch to control NewsCorp. with just 15 per cent of equity.
In the meantime, we’ve decided to offer him a guest appearance on FT Alphaville…
