Without an ounce of irony, The Australian reported this morning on the shake up at Consolidated Media Holdings, the sinecure James Packer created for a bunch of former courtiers and executives and a few mates after he split PBL. There are also changes afoot at Crown, the gambling company.

“Packer sends adviser packing” blared the headline in The Oz. If this happened at News the toll would be much greater, as time serving former editors and newspaper hacks, now hench people and office sitters, were thrown out to make way for new blood on the papers.

According to the report:

A major restructure at the boards of James Packer’s main public companies, including Consolidated Media Holdings and gaming group Crown, has seen the departure of former high-level adviser Chris Anderson from all of his listed board roles at Packer interests.

In that paragraph, not a sense of understanding of how the situation evolved. James Packer created the two companies with advisers; he stacked the boards with people like Mr Anderson, Mr John Alexander, David Lowy, Geoff Dixon and Chris Corrigan, plus Michael Johnston, Ashok Jacob and Richard Turner.

The cost of the board of upwards of nearly $900,000 was a direct response to the $100,000 (now $65,000) a year Mr Packer signed off on for each of the 14 directors. It was a joke then and remains a joke. All Cons Media had was a collection of investments and after it failed to help refund PBL Media, there were cut to shareholders in Foxtel, Premier Media Group and Seek.

Given that ConsMedia is News Ltd’s partner in Foxtel (with Telstra) and in Premier Media (AKA Fox Sports), there was an element of finger pointing and chortling in the coverage. It wasn’t the big story yesterday — the NBN remains the big yarn, while the profit downgrade at QBE was also a bigger yarn.

The guy Jalland mentioned in the stories as “an executive as his private company” is actually a former senior executive at PBL, where he was the final company secretary and legal counsel before the split. Mr Jalland was listed in the ConsMedia annual report as a senior executive on page 35 as at June 30 last year year. He went to Mr Packer’s private company later in 2008.

The reduction in the size of the board will cut half a million dollars from CMJ’s running costs and reduce board costs to around $354,000, according to the statement from CMJ yesterday.

But the biggest cost centre remains the executive chairman, Mr Alexander, he gets $1.5 million a year in that role (Remember he received $19 million in the split when he changed from being CEO of PBL to being executive chairman of ConsMedia and deputy chair of Crown. He had his shares paid out and other payments made.

Part of the cost saving will be the winding up of the executive share plan at ConsMedia.

The firm will recall loans made to its executives to buy shares granted under its executive share plan to close the plan. ConsMedia says the 64 participants in the share plan will have to repay the loans by April 16 or Consolidated Media will have the shares sold on their behalf.

That will generate big losses as the shares are trading around $2.03 and many of the loans were made at prices well over $3 a share.

Mr Alexander could one of the the biggest losers if he has to cough up for the losses for his 1.3 million ConsMedia shares. He had 1 million at $3.29 a share and 300,000 shares at $3.71 a share. That’s a total loan value last June 30 of $4.6 million, according to the ConsMedia annual report. Crown boss Rowen Craigie has more than 2 million ConsMedia shares, so he is also well and truly underwater at $2.03 a share.

At $2.03 a share, Mr Alexander’s shares have a value of $2.6 million, so there’s a $2 million shortfall. The loans are “limited” non-recourse to the shares, so the company will pay (see page 2 of the release).

There’s around 11.266 million shares on issue and the losses could very well be more than $20 million. Once again the shareholders are the biggest losers (including Mr Packer’s 38%) because of the way he richly rewarded a bunch of people for doing nothing at a company that is a post office box and collects dividend cheques (which would be banked electronically anyway).