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Stokes eyes succession
Lincoln Baker/The West Australian Stokes eyes succession

Kerry Stokes says Seven West Media expects to detail as early as next month a succession plan for chief executive and long-time Channel 7 boss David Leckie.

Speculation about a successor to Mr Leckie, who has headed Seven West Media since its formation in May after running Channel 7 for eight years, has intensified since the sudden and controversial defection to the Ten Network in March of the widely-regarded heir apparent, Channel 7 sales boss James Warburton.

Mr Leckie's contract expires in July.

"It's fair to say that the board is evaluating the succession process and I reckon by the end of this year there will be some form of announcement," said Mr Stokes, Seven West Media's chairman. "But I expect also David will be around for some time."

The group remains keen to tap an internal candidate for a successor, most likely from the ranks of Yahoo!7 chief Rohan Lund, Channel 7 programming and production boss Tim Worner, Channel 7 sales and digital officer Kurt Burnette, Pacific Magazines boss Nick Chan and Seven West Media WA chief Chris Wharton.

"Media at the moment is struggling with revenue," Mr Stokes said. "As tough as the times are, everybody in the group from magazines, to television to The West Australian are working their hearts out. And we're actually getting more than our share of revenue in what is one of the toughest markets I've seen."

In a wide-ranging interview, Mr Stokes also expressed his disappointment in Seven West Media's sharemarket performance, reiterated his warning to short-sellers and revealed the Seven camp had considered buying Fairfax Media shares.

He was speaking ahead of today's inaugural annual meeting of Seven West Media at the Hyatt Regency at which he expects to face some tough questions from shareholders over the group's weak share price.

With Seven West Media's $1.95 billion refinancing successfully bedded down, the stock has recovered from a low of $2.50 early last month to $3.24 yesterday. However, it is still well off the $6.34 at which WA Newspapers was trading before the announcement of its merger with Seven Media Group in February and the $5.20 at which the group raised fresh equity to fund the transaction.

"I know everyone is disappointed in the share price. No-one is more disappointed than I am," Mr Stokes said.

Seven West Media has laid some of the blame for the weakness on short-selling of the stock amid global economic uncertainty ahead of the refinancing.

Seven Group was quick to make a statement by immediately re-entering the market to support the Seven West Media share price when a six-month ban on buying expired at the end of October, increasing its stake under the creep provisions to 32.5 per cent at a cost of $41 million.

Mr Stokes said Seven Group had been comfortable with the size of its stake but "if anybody thinks they're going to short our shares again . . . or manipulate the share price, then we will have something to say about it".

He said the Seven camp had considered investing in Fairfax Media last year and again last week when it was offered stock as part of John B Fairfax's exit.

However, Seven West Media's commitment to shareholders to reduce its debt precluded it from pursuing the shares, while Seven Group concluded that Seven West Media's existing assets offered better exposure to media.

Mr Stokes denied that the sale of Mr Fairfax's 9.7 per cent stake in Fairfax Media reflected a vote of no-confidence in the sector.

"They must have come to the conclusion at the end of the day that they could invest their money better outside the company and that's why I think it's a statement on that company rather than the industry," he said, adding that Seven West Media, with national brands such as Channel 7 and Pacific Magazines, was in a better space than Fairfax Media.

"With due respect, they've (Fairfax Media) had their share of issues over the past years which have been pretty well documented."

However, with The Weekend West outselling the Saturday editions of The Age and the Sydney Morning Herald, which operate in bigger, albeit more competitive newspaper markets, Mr Stokes said "maybe they're not reading the market right".