HOSTILITIES have effectively resumed between Denis O’Brien and the O’Reilly family over the running of Independent News & Media.
The group’s board wasted little time in replying to Mr O’Brien’s demands and challenging the veracity of many of his claims.
The company’s share price fell by just under 4% to 25c after a day when serious cracks showed in the supposedly mended relations between the O’Brien and O’Reilly camps.
Mr O’Brien’s call for an EGM to cover, among other issues, the continued independence of INM’s board and the future ownership (or not) of assets such as its South African advertising business and its London newspaper titles – calls into question his long-term investment strategy and comes less than a week after its management said that it was confident of finally reaching an agreement over the re-financing of its €200m bond, after three deadline extensions.
INM said the actions could hamper efforts to successfully restructure its finances. “It is difficult to see how Mr O’Brien’s actions assist in the resolution of the financial restructuring, which the board believes is in the best interests of the company and its stakeholders,” the group said.
Regarding its South African advertising subsidiary, it said the decision to sell had been agreed by the board in March and it was “a key part of the group’s de-leveraging programme since the beginning of the year.
“In addition, it is central to the current refinancing discussions and our banks have confirmed that they consider it key to any resolution,” it added.
Regarding Mr O’Brien’s call for the removal of chairman, Brian Hillery and the appointment of a new independent director in place of Baroness Margaret Jay, INM said that those appointments have already been unanimously approved by the board and that his call for a detailed breakdown of board member expenses going back almost 10 years is effectively redundant given that these matters “have already been subject to independent inspection by the group’s external auditors.”
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