Fairfax Media's second-largest shareholder, fund manager Allan Gray, has further trimmed its stake in the media company.

A shareholder notice shows Allan Gray now has 9.3 per cent of Fairfax Media, from 10.4 per cent previously.

The firm's Simon Marais said Allan Gray sold because its stake had got too big, and after a surge in the company's share price.

"It's gone berserk. We're just cutting a little," he said. "We are happy to have a certain position."

Shares in Fairfax closed down 1 per cent to 95¢s on Wednesday. After years in the doldrums, its shares have rallied through 2014 largely on the back of expectations it can better monetise its real-estate classified business, Domain.

Gina Rinehart's Hancock Prospecting remains Fairfax's largest shareholder, with just under 15 per cent. Fairfax publishes this website.

The selldown comes amid expectations that the Coalition will propose to water down Australia's media ownership laws, which could trigger a spate of mergers from traditional media companies unsure about their long-term growth prospects.

But Mr Marais said a relaxation of cross-media laws was not necessarily a fillip for media companies.

"I'm not it will be good or bad. The best thing that's happened to Fairfax is it's getting its act together."

Labor has been tightlipped about its policies on media ownership, although Shadow Communications Minister Jason Clare told Sky TV today that media reform was a "minefield."

"It's not just the ownership changes, the local content changes that are problematic, it’s also any change that you make that affects people’s ability to watch sport on TV as well as the fees that are causing difficulties for some of the major networks at the moment."