Karl Stefanovic has agreed to purchase the shares held by his business partner Keshnee Ibrahim in their joint podcast venture, with the New South Wales Supreme Court on Tuesday laying out the path forward after the pair's relationship irretrievably fractured. Justice David Hammerschlag heard arguments in Sydney and indicated that a buyout would proceed, with the remaining question being the valuation at which the transaction would occur.
The dispute centres on 123 Podcast Pty Ltd, registered in February, which operates The Karl Stefanovic Show. Both Stefanovic, 52, and Ibrahim, 36, hold 45% stakes each in the company, with the remaining 10% held by Stefanovic's accountant and business adviser Anthony Bell, who is not involved in the dispute.
Ibrahim filed an urgent application on Monday seeking to defer a shareholders' meeting scheduled for 18 September, fearing she would be removed as a director. The court heard that Stefanovic's legal representatives confirmed he had agreed not to proceed with that meeting and was seeking an early court decision on a buyout arrangement.
What triggered the breakdown?
The partnership deteriorated following Stefanovic's controversial interview with far-right figure Stephen Yaxley Lennon, commonly known as Tommy Robinson, which sparked significant public backlash and led Nine to terminate his role as host of the Today program. The podcast itself has been on hiatus since 24 August following an interview with a de-aging expert, and had not published new episodes for three weeks at the time of the court hearing.
The split was also linked to tensions over control of the business itself. Additionally, the podcast had lost its major sponsor, with Ringers Western not planning to renew a deal that ends in September, further complicating the venture's prospects.
Stefanovic's lawyer Samuel Murray told the court that his client had agreed there was an
irreconcilable breakdownin the relationship and that a buyout of Ibrahim's shares was the appropriate course of action. However, Stefanovic disputed Ibrahim's claim that the company had been run in a manner that was oppressive to her interests.
How will the buyout value be determined?
Justice Hammerschlag outlined two possible paths forward: the company could be wound up on an equal basis with a liquidator determining its value, or Stefanovic could purchase Ibrahim's stake. The judge indicated that a buyout would proceed, stating
There's going to be a buyout. So the question's become, what effect, if any, would the alleged oppression have on the value.
Stefanovic had requested that the valuation be based on the company's worth as of 7 August, a date he argued was significant because it preceded most of the conduct that led to the breakdown. On that date, Stefanovic was promoting an interview with One Nation leader Pauline Hanson, posting a picture of the senator alongside himself and his wife, Jasmine, with the caption
Luckiest girls in the world.
Murray argued to the court that
The 7 August date is important because [it] is before the majority of the conduct that's complained about actually occurs. However, Justice Hammerschlag indicated he was unable to determine at that stage how the 7 August date would affect any buyout valuation.
The judge ordered both sides' legal representatives to agree on an independent valuer and submit figures to his chambers. After a brief adjournment, the two parties agreed on a third party to conduct the valuation.
What is the podcast's track record?
The Karl Stefanovic Show has accumulated approximately 23 million views on YouTube since its launch. The venture represents Stefanovic's move into independent media following his departure from Nine, where he had been the long-time face of the flagship Today program.
What happens next?
Justice Hammerschlag set the next hearing date for 13 October, giving the independent valuer time to assess the company's worth and allowing both parties to prepare their positions. The judge remarked that
This is obviously something that, if it can be settled, it should be settled, signalling his preference for the parties to reach agreement rather than pursue further litigation.
