How will David Murray vote his Telstra shares?

Telstra is still a couple of directors short of a full board which makes the timing of T3, the transfer of the government’s residual 30% stake to the Future Fund and this year’s AGM more interesting than usual.

There’s been plenty of speculation about what Future Fund chairman David Murray will do to Telstra once he’s got control, but it remains to be seen whether he’ll be voting the stock in just two months time.

I’ve had some lively meetings with business leaders over the years but the 1998 gathering with David Murray remains a highlight.

After a bunfight between the Commonwealth Bank and The Daily Telegraph, Cranky Dave declared that the debate shouldn’t be about how AGMs are conducted, but whether they should be held at all. He warned that people like me would send Australia down the Japanese path which sees major companies holding their AGMs on the same day to thin the resources of the notorious Yakuza gangs.

He then, only half-jokingly, said that CBA put fans behind the hot food to blow the nice smell into the AGM to encourage the elderly sandwich brigade to wind up proceedings as early as possible.

Given this history, wouldn’t it be a lovely irony to run for the Telstra board this year and start making representations to Cranky Dave for a board spot.

While the government reportedly made inquiries with its bureaucrats about the process available to remove Telstra chairman Donald McGauchie, it would be extremely messy in political terms given the public battle over regulation.

Having “independent” Future Fund chairman David Murray drive through a board coup would be nice and arms length from the government, but it certainly couldn’t happen in the middle of T3, which is what makes the exact dates of the offer very interesting.

Telstra AGMs have been held on the following dates in recent years:

Anyone who wants to run had better get their skates on and any new government appointments will need to be named quick smart so they can sign the prospectus and be voted on at the AGM. The government has traditionally voted on every single resolution in a poll, so it will be interesting to see if David Murray continues this tradition. With 30% of the shares it would effectively give him control over 100% of the board.

What ought to happen is that the Future Fund should have three direct representatives on the board, perhaps including Murray himself, and then the public shareholders should vote on the other seven.

However, it’s hard to imagine the government voluntarily surrendering board control like that.