Probably only Kerry Stokes would have the chutzpah to replace a near-legendary television chief executive with someone who spent most of their career as a senior executive in the global oil and gas industry.
The appointment of former Woodside Petroleum chief executive Don Voelte to replace the architect of Seven West Media’s dominance of the television sector – and before that the similar success of Nine Network – David Leckie, would generate controversy if it were announced by anyone but Stokes. It still may well do.
It has been known for quite some time that the larger-than-life Leckie, who has had some health issues, was nearing retirement, albeit reluctantly. Stokes had been grooming James Warburton to be his successor before he defected to Ten Network last year.
But Voelte? The sometimes abrasive Nebraskan-born Voelte retired last year after a seven-year stint at Woodside during which he oversaw an era of ambitious and rapid expansion, almost to the point of over-reach. Like Leckie, Voelte isn’t afraid to say what he is thinking, although he did engender loyalty and enthusiasm within his Woodside team and created quite a progressive culture within the business.
Voelte’s media experience relates to his time as a director of West Australian Newspapers and subsequently Seven West Media, which was formed through the merger of WAN and Seven last year. He joined the WAN board, with another resource sector heavyweight, Rio Tinto’s Sam Walsh, when Stokes ousted the old board in 2008.
Presumably he has impressed. Stokes said today that as a director of Seven West Media Voelte had made a strong contribution to the development of the business. There’s no doubt that Voelte has leadership skills and has experience in making big decisions and competing against global giants. It’s his understanding of the media sector that creates a question mark.
Stokes has, however, hedged his bets. Leckie has been appointed an executive director, media, for Seven Group Holdings, which owns about 30 per cent of Seven West Media and is the vehicle for Stokes’ control of his interests in the media, the Westrac agricultural and mining equipment business and a substantial investment portfolio.
Leckie will have an "advisory and counsel role" with Seven West Media’s television operations.
Given how difficult and volatile the environment for media, including television, has been and remains – Seven West Media issued a significant profit downgrade earlier this year, although it restated that guidance today – Voelte may need that counsel.
Seven West Media does have a group of very experienced media executives at the operational level, headed by Tim Worner as CEO of the key television business and Nick Chan as CEO of Pacific Magazines – and Stokes, of course, is a hands-on proprietor. Voelte will have plenty of advice to call on.
He also inherits the leadership of the dominant television and magazine group, and while Nine Network is experiencing something of a comeback thanks to the success of The Voice and with the Olympic Games imminent, it is debt-laden and working furiously to try to escape the clutches of a group of hedge funds that have acquired a sizeable proportion of its senior debt.
Ten is the weakest performer in a sector under considerable pressure and, assuming Warburton can stabilise it and turn it around, it will be a two or three-year process. At least he has support and financial backing from Gina Rinehart, Lachlan Murdoch, James Packer and Bruce Gordon for the attempt to rebuild Ten.
Stokes, of course, has a strategic stake in James Packer’s Consolidated Media, held within Seven Group. He’s positioning himself to either launch a counter-bid to the foreshadowed $2 billion offer for ConsMedia from News Ltd or using the stake as leverage to extract something from News in return for not blocking its offer. Leckie’s elevation to the Seven Group board – and his reference today to "further enhancing" Seven Group’s media presence – may not be unrelated.
