Harbinger defends nomination of three to Media General's board of directors

By Lisa Kerner

Charlotte, N.C., Jan. 30 - Media General, Inc. investor Harbinger Capital Partners Master Fund I, Ltd. said it was disappointed by the tone of the company's press release in response to Harbinger's nomination of three people for election to Media General's board of directors.

Harbinger's goal in making the nominations was to add value by bringing "fresh ideas and valuable perspective" to the company's board, according to a Jan. 30 letter from Harbinger to Media General president and chief executive Marshall N. Morton.

The letter was included in a schedule 13D filing with the Securities and Exchange Commission.

Contrary to Media General's claims, Harbinger said its action was neither "hostile" nor "ill-advised."

On a positive note, Harbinger's Philip A. Falcone cited Media General's "terrific collection of assets" and said he would welcome a meeting with Morton. Harbinger, according to Falcone, has no interest in altering the company's dual class share structure.

Harbinger, which holds 18.4% of the company's class A shares, is Media General's second-largest shareholder.

The investor noted that since first investing in Media General, its stock has fallen 39%. Since its peak, the Richmond, Va., communications company's stock is down 72%, the filing stated.

Harbinger believes it is time to enhance Media General's corporate governance and adjust its strategic direction to:

• More directly address the challenges faced by the company;

• Sustain and improve Media General's long-term profitability;

• Optimize the company's capital allocation; and

• Increase focus on maximizing stockholder value.

As previously reported, Harbinger's nominees are J. Daniel Sullivan, F. Jack Liebau Jr. and Eugene I. Davis.

Sullivan is an experienced television broadcasting insider, according to Harbinger. Liebau is president of Liebau Asset Management Co. Davis is chairman and CEO of Pirinate Consulting Group, LLC.

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