Aside from the fact its one of the biggest dogs in my portfolio, Media General (MEG/NYSE) is a pretty boring company. By that I mean it's not the stuff of headlines -- even though most of its business consists of newspapers.
But you might have seen the story the other day that Harbinger Capital Partners has bought a bunch of Media General stock and wants three seats on the company's board. (The hedge fund also wants four seats on The New York Times, a company I don't own stock in.) From the linked Bloomberg report:
Media General, owner of the Tampa Tribune and 23 television stations, has fallen 51 percent in past year and New York Times is down 36 percent as newspaper companies lose advertisers to the Internet. The losses have been extended by a U.S. economic slowdown and a housing slump that has bitten into classifieds.
Harbinger, a hedge fund run by Philip Falcone, nominated Eugene Davis, chairman of Pirinate Consulting Group, Jack Liebau, president of Liebau Asset Management, and media investor Daniel Sullivan to Media General's nine-person board, according to a regulatory filing today.
Mario Gabelli, through various of his entities, is the biggest Media General shareholder. I read his thoughts in the annual Barron's Roundtables, but don't follow him closely (you can't follow everyone, you know).
Yet it's worth noting his -- so far -- sympathetic feelings toward Harbinger's demands:
Gabelli hasn't decided whether to back Harbinger's entire slate of nominees to replace directors elected by common shareholders, he said today in an interview. He did say he supports Liebau. The board is chaired by John Stewart Bryan III, a member of the controlling family.
It's time for a change,'' said Gabelli, whose Gamco Investors Inc. owned a 20.9 percent stake in Media General in November. "We're not sure how we'll vote on this proposal -- we might abstain. But we do think change would be good here.''
My feeling now is that I'll follow Gabelli here -- in that I certainly won't just blindly vote with management. This is a case of the dual-class share structure making it virtually impossible to make Media General's controlling family do anything they don't want to do. So I won't get my hopes up.