INM tried to cut O’Brien’s shareholding
INDEPENDENT News & Media (INM) held talks with Axel Springer regarding the German media group making an investment in the debt-laden firm in a bid to reduce the stake of rebel investor Denis O’Brien.
The talks – which have since broken down – centred around Springer supporting a rights issue that would have diluted O’Brien’s 26 per cent shareholding in INM.
The news came as the full extent of the bitter row between O’Brien and INM founder and 28 per cent shareholder Tony O’Reilly was laid bare.
The content of a heated three-way conversation between O’Brien, one of his board representatives Paul Connolly and INM chief executive Gavin O’Reilly, son of Tony, was noted down by Gavin O’Reilly.
According to the notes, O’Brien threatened to call an extraordinary meeting of shareholders to vote on resolutions to change the firm’s strategy.
“He became more aggressive and said if I wanted a ‘fight’, he’d destroy me and my father’ and ‘go after everything’,” noted O’Reilly.
Three days later O’Brien demanded an extraordinary meeting be convened to vote on his proposals.
In a six-page letter to INM he accused the seven board members who do not represent his own interests of being part of the O’Reilly “legacy” that made poor decisions.
He reiterated his frustration at the group’s failure to address its €1.3bn (£1.1bn) debt – including a €200m bond which was due in May – saying that O’Reilly was “incapable” of leading the restructuring.
O’Reilly’s resolutions include the sale of loss-making titles The Independent and its Sunday sister; the removal of Brian Hillery as chairman; and the cancellation of the disposal of its South African outdoor operation.