Peter Costello in control as Nine board splinters

Peter Costello has assumed a greater role in running Nine Entertainment amid a deepening split among directors.

Nine chairman Peter Costello and outgoing chief executive Hugh Marks. Picture: John Feder

Nine Entertainment chairman Peter Costello has assumed a greater role in the day-to-day running of the embattled media giant amid a deepening split among directors aligned with the company’s rival broadcasting and print divisions.

Nine’s outgoing chief executive, Hugh Marks, has been absent from key investor meetings following the company’s first-half financial results last Wednesday. He largely left the key negotiations with Google and Facebook over payment for content to Mr Costello and Chris Janz, who runs publishing.

Mr Marks said he would leave Nine in November after disclosing a personal relationship with Alexi Baker, a senior executive who had quit a month earlier.

The company’s board has long been split between directors who were formerly with Fairfax Media — which merged with Nine in December 2018 — and those with the broadcaster.

Mr Marks was also absent from a high-stakes Senate hearing into the media bargaining code in January, leaving that presentation to Mr Janz.

Hugh Marks, right, listens as Kevin Rudd delivers a submission during the public hearing into media diversity at Parliament House in Canberra last month. Picture: Getty Images

But Mr Janz is not the favoured candidate to take Mr Marks’ position when he leaves. Industry sources have suggested former Endemol Shine Australia chief executive Carl Fennessy was firming for the top job.

Divisions on the board spilt into public this week, with the company’s newspapers reporting anonymous complaints against Nick Falloon, the former Fairfax Media chairman who became Nine’s deputy chairman.

Another former Fairfax director, Patrick Allaway, has also resigned, while the remaining board member previously with the publisher of The Sydney Morning Herald and The Age, Mickie Rosen, is widely expected to follow. She could not be reached on Tuesday.

Nine sources noted the speed with which an independent investigation was established into Mr Falloon’s conduct — he is accused of misusing a corporate membership at a prestigious Sydney golf club — compared to Mr Costello’s reluctance to look into Mr Marks’s conduct ahead of his resignation.

“He’s running the show,” one industry source, who spoke on condition of anonymity, said of Mr Costello on Tuesday. “He thinks he’s (Seven West Media chairman) Kerry Stokes.”

But a Nine spokesman insisted Mr Marks had been “actively involved” in the content negotiations with Google and Facebook.

Chris Janz. Picture: AAP

“Peter has not had a more hands-on role in the company — he is the chairman and fulfils that role,” the spokesman added.

Those within the company’s publishing division — which is largely made up of the former Fairfax Media newspapers — ­believe directors aligned with the broadcast division are moving to expand their influence.

Along with Mr Costello, Samantha Lewis and Catherine West were Nine directors before the merger with Fairfax Media.

The board has been considering candidates to replace Mr Marks for months, with the two internal candidates — Stan boss Mike Sneesby and Mr Janz — both highly regarded.

But The Australian has been told that Mr Fennessy has strong backing — and, crucially, is Mr Costello’s preferred option.

Another aspect in Mr Fennessy’s favour, according to one Nine source, is that both Mr Sneesby and Mr Janz are more likely to stay with the company if they are overlooked for an external candidate, rather than if they are beaten by an internal rival.

Martin Currie’s chief investment officer, Reece Birtles, said he had been told by Nine that the announcement of a new chief executive was close.

“They’re confident that it’s not too far off,” Mr Birtles said.