How a former Fairfax editor got himself $100 million from the Packers

Newspaper editors are not traditionally very good at forging a new commercial career which delivers them serious personal wealth, but former Sydney Morning Herald editor John Alexander has done it better than anyone.

He has been an extraordinarily well-paid executive for the Packer family across three separate public companies over the past 21 years.

Alexander was a very talented Fairfax editor who was foolishly sacked by then-Fairfax CEO Bob Muscat in May 1998. This is when he first learnt the art of negotiating an exit package; Alexander reportedly refused to leave his Fairfax office until Muscat had agreed to pay him four times his legal entitlements.

It was then straight into the job with the Packer family’s PBL (Publishing and Broadcasting Limited) to run its magazine division ACP. He did his best commercial work here, creating significant value ahead of the $5.5 billion private equity joint venture with CVC Capital Partners in 2006.

For this, he was paid an extraordinary $15 million redundancy payment by PBL in 2007-08 after the Crown demerger — but he never really left the building.

Fast forward 12 years and Alexander was still sitting near the top of the Packer tree as executive chair of Crown Resorts until it all came to an abrupt end with this announcement at 4.44pm on Friday afternoon.

The famously media-shy cost-cutter will have his roles divided in two. Howard-era communications minister Helen Coonan will become independent non-executive chair, and former Boral CFO Ken Barton will step up as CEO after a solid nine-year stint working alongside Alexander at Crown.

However, despite no longer being CEO or chair, Alexander, 68, proved his tough negotiating record again: he will be paid a tasty $3.34 million by Crown shareholders under a new contract over the next 12 months. He will serve out this time as an executive director. After that, it sounds like he’ll be gone.

So just how much was Alexander paid by public company shareholders controlled by the Packers? The final figure will reach more than $100 million, which is a record for any Australian-listed company with the exception of a few millionaires at Macquarie Group.

First up, let’s take a look at the breakdown of the $81.6 million which Crown Resorts, Consolidated Media Holdings (CMH) and PBL has disclosed in annual reports was paid to Alexander since 2002-03:

2018-19: $4.46 million from Crown
2017-18: $4.7 million from Crown
2016-17: $2.2 million from Crown
2015-16: $2.63 million from Crown
2014-15: $2.63 million from Crown
2013-14: $1.5 million from Crown
2012-13: $1.5 million from Crown, $1 million from CMH, plus sold CMH shares for $1.5 million
2011-12: $1.5 million from Crown plus $1.94 million from CMH (total $3.44 million)
2010-11: $1.5 million from Crown plus $1.9 million from CMH (total $3.4 million)
2009-10: $1.5 million from Crown plus $1.77 million from CMH (total $3.27 million)
2008-09: $2 million from Crown plus $2.14 million from CMH (total $4.14 million)
2007-08: $19.2 million (including $15 million termination payment)
2006-07: $6.67 million from PBL
2005-06: $7.66 million from PBL
2004-05: $5.83 million from PBL
2003-04: $3.6 million from PBL
2002-03: $3.78 million from PBL

In addition to this, he will collect around $6 million for the period from July 1, 2019 until his final exit in January 2021.

He also sold his CMH shares to News Corp for $1.5 million in the 2012 takeover, currently owns 400,000 Crown shares worth $4.8 million, and was paid more than $10 million for his four years of service at PBL between 1998 and 2002.

I’ve engaged with Alexander as Crown’s executive chair at the past three AGMs and am pleased that he is going. He was uncooperative to say the least and in denial about the various governance scandals and challenges the company is facing.

As for what he’ll do next, he’ll have more time to serve on the board of the teetering Seven West Media where he is the independent chair of the remuneration committee and was paid $155,000 last year.

Having been paid more than $100 million by Packer-controlled public companies since 1998, you would think he could afford to own more than 55,768 Seven West Media shares. With the stock closing at 29.5 cents on Friday, these only worth a miserable $16,451.

Then again, at least he’s on the register. Helen Coonan has never owned a single share in Crown Resorts despite receiving more than $1.5 million in cash board fees over the past decade.

It’s one thing to be paid well by public companies, but directors should have skin in the game — particularly when the performance has been poor, which is certainly the case with Seven West Media and Crown Resorts in recent years.

Stephen Mayne is the founder of Crikey, and previously worked part-time at The Alliance for Gambling Reform.