The report in News Corp’s The Australian newspaper on Monday said Mrs Rinehart, who is the major shareholder in Fairfax, was “considering buying” the company if “she can find the right person to run it.” The report said Mrs Rinehart had approached “business associates” for suggestions on potential replacements for senior managers and directors should she decide to launch a takeover bid.

“I think this is all rampant speculation if you ask me,” said Simon Marais, managing director of Allan Gray, which owns 5.7 per cent of Fairfax. “She may have somebody look at it but that’s very far from actually taking it over.

“I know no more than what was in The Australian.”

The report also said former Victorian premier Jeff Kennett declined an approach from Mrs Rinehart to become an alternative director of Fairfax, publisher of The Australian Financial Review, two years ago. Mr Kennett said he had “no idea” whether Mrs Rinehart was planning a bid for the company. “I haven’t spoken to her for years,” he said.

Mr Kennett said he had declined Mrs Rinehart’s offer to serve as a director due to his relationship with News Corp (he is a columnist for the Herald Sun newspaper), and that Fairfax was best off “running your own lifestyle.”

Fairfax declined to comment. Representatives for Mrs Rinehart’s private company, Hancock Prospecting, were contacted for comment.

Hancock Prospecting owns just under 15 per cent of Fairfax Media, having first paid $50 million for 1.5 per cent of the company in late 2010.

Paul Xiradis, managing director of Ausbil Dexia, which owns 6.4 per cent of Fairfax, said while he didn’t know whether a bid was on its way, the company was “turning itself around and from our point of view, it’s still undervalued.”

This was due to a combination of cost-cutting, new revenue streams and its real estate classified business Domain, he said.

The report referenced comments from Mr Marais last week when he described the future of Fairfax as "uncertain” and that cost-cutting would continue.

“That interview in The Australian was so far from what I really said,” he said. “They try to push you to say certain things.

“She (the journalist) was desperate for me to say the paper has been going backwards and Roger Corbett (Fairfax chairman) was doing a bad job etc, and I just didn’t want to go there because I don’t think that’s true actually.”

Fairfax shares were up by 2.2 per cent to 93¢ at 3:47pm eastern standard time.