Fairfax ends the romance

Today's sale, for around $195 million, of Marinya Media's 9.7 per cent stake in Fairfax Media is the final sorry punctuation point in what was once a romantic story.

The 2006 return of John B. Fairfax to the company which carried his family's name through the merger of his Rural Press Group with Fairfax had an emotional feel-good element to it.

At the time, the merger of the companies was seen not just as a return of the Fairfax family to the fold but as a $1 billion-plus vote of confidence in the then fast-expanding group. That was the value placed on Marinya's shareholding by the deal.

That was, of course, pre-crisis and before the implosion in the Fairfax Media share price that occurred as structural and cyclical influences combined to decimate the profitability of its metropolitan mastheads.

Ironically, the performance of what was once Rural Press has been relatively stable.

As the Fairfax Media share price sank, John B. Fairfax's relationship with the company became tense, culminating in the public, and ultimately successful, campaign to unseat former chairman – and one of the architects of the Rural Press deal – Ron Walker. John B. retired from the board last year and his son Nicholas is expected to follow suit now that the family no longer holds any Fairfax Media shares.

While Fairfax said the decision wasn't easy, and that he strongly believed the Fairfax board and management have "a full understanding of both the challenges and numerous opportunities ahead and are tackling them in a logical and concerted way", it is difficult not to interpret the sale at current prices as a vote of no confidence, or at least of little confidence, in the eventual outcomes.

There will be some who speculate that the sale, and other recent sales that have now raised the best part of $400 million for Marinya, is a sign of financial pressure.

Fairfax himself said it was a prudent transitioning to a more balanced and diversified investment portfolio.

Given the loss of wealth he has already experienced from his involvement with Fairfax – and the complexity of the challenges relatively new Fairfax chief executive Greg Hywood is grappling with – a desire to protect the family's residual wealth would seem a reasonable and sensible explanation.

If Nicholas does depart the Fairfax board, it will end a relationship with Fairfax Media that, punctuated by the decade between Warwick Fairfax's disastrous buy-out in 1987 and John B's return, dates back to the 1850s.