Independent News and Media has laid the latest blow in its ongoing feud with dissident shareholder Denis O’Brien by warning that his “personal antagonism” was damaging the company.
The troubled publisher issued a strong rebuttal late last night to O’Brien’s demand yesterday for the company’s financial restructuring plan to be put to a shareholder vote.
O’Brien last week demanded an extraordinary general meeting at INM to consider his proposals for the immediate closure of the London-based Independent titles and a range of other controversial proposals – each of which was knocked back by INM.
INM issued astatement to the London Stock Exchange last night saying that acceptance of O’Brien’s most recent demand – which would mean revoking the authority of the company’s directors – would risk damaging the board’s refinancing efforts.
Despite requests from INM, the company said O’Brien had failed to offer details of any credible alternative restructuring proposal – despite the fact that his representatives have been closely involved in the restructuring discussions from the outset.
INM said: “His apparent personal antagonism towards the doard and management and his very public campaign in that regard only serves to damage the trading prospects, staff morale and reputation of INM, and ultimately destroys value in the group and hinders a consensual refinancing solution, outside a court administered process, being achieved.”
O’Brien, who as the second biggest shareholder has a 26 per cent stake in the business, is seeking a second extraordinary general meeting so shareholders’ could vote on a financial restructuring plan designed to save the company.
Under the proposed deal it is understood that Tony O’Reilly will halve his near 30 per cent controlling stake in the company in a deal which will give lenders more ownership of the company and see its Euros 1.3bn loans extended until 2014.
The rogue shareholder is unhappy that INM’s directors have the power to issue new shares without the approval of shareholders
INM added yesterday that measure was approved by 99 per cent of shareholders and by O’Brien’s representatives on the company’s board ahead of its annual general meeting in June.
The company said: “Mr O’Brien’s latest requisition notice proposes a resolution to revoke the director’s authority to allot and issue relevant securitiesâ€¦Revocation of this existing valid authority, during this difficult and rapidly developing period as the company pursues its restructuring discussions, would undermine the Board’s efforts to find the optimal solution for the Company and consequently risks damaging all such interests.
“The company has previously noted that it is difficult to see how Mr O’Brien’s unilateral actions heretofore assist in the positive resolution of the company’s financial restructuring.”