Australia's Rinehart gives ultimatum to Fairfax chief

Mining magnate Gina Rinehart on Friday laid down an ultimatum to the chairman of troubled Australia media giant Fairfax -- meet a number of performance targets or resign.

Rinehart, Fairfax's biggest shareholder, said in an open letter to Roger Corbett he should quit by November if he does not reverse "the five-year decline in paid circulation and in revenue of the Fairfax mastheads".

The world's richest woman, whose push for three board seats was rejected by Fairfax this week, also demanded he bring the share price up to 87 cents by their November annual general meeting.

This "would represent only a 50-percent loss from the commencement of your chairmanship in October 2009", she said.

The stock closed Friday at 55 cents.

"Shareholders should at the very least be advised what the loss target is, and be assured that should you not meet that target, there would be light at the end of tunnel," the letter said.

"And if the five-year decline in paid circulation and in revenue of the Fairfax mastheads do not reverse prior to the 2012 AGM, we ask that you tender your resignation at that meeting."

Rinehart, who has recently bought close to 19 percent in the newspaper, radio and online publishing group, has been at loggerheads with Corbett over concerns she wants to influence editorial policy.

Fairfax journalists have called on the iron ore tycoon to sign the company's charter of independence amid concerns she would attempt to influence coverage, including at flagship newspapers The Sydney Morning Herald and The Age.

But Rinehart said this was not the key issue.

"Where we have differed most profoundly is not over the charter of editorial independence, contrary to much Fairfax reporting, but how to save a business that is reportedly in danger of dying," she wrote in the letter.

"What is at stake is the survival of Fairfax Media, so it is not time for smokescreens to divert attention."

Fairfax rejected the claim, replying in a statement: "Contrary to Mrs. Rinehart's assertions that this isn't about editorial control -- it is."

"It is also about her obtaining control of the company and not paying a premium," it added.

Fairfax said it stood by its charter of editorial independence and that the media group's principles underpinned the credibility of the mastheads.

Countering Rinehart's comments about share price, Fairfax said all media stocks had suffered in the current climate, adding that since she joined the board of free-to-air television network Ten, its shares had lost 63.4 percent.

In the same period Fairfax's stock price fell 60.6 percent, it said.

The Australian media sector is enduring a turbulent period, with Fairfax recently announcing 1,900 job cuts as part of a digital-focused restructure amid plunging advertising and readership revenues.

Rupert Murdoch's News Limited, Fairfax's main rival, has also flagged large job losses as it grapples with the challenges of online transition.

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