INDEPENDENT NEWS Media shareholders gather again in the Green Isle Hotel this morning for the latest extraordinary general meeting in a long list of egms to consider a resolution from Denis O’Brien to revoke the board’s authority to issue new shares.
It’s a pointless exercise, given that INM earlier this week issued 724 million shares to its bondholders, after they had agreed to a financial restructuring plan drawn up Gavin O’Reilly to settle a €200 million debt that was due for payment back in May.
O’Brien’s resolution should be easily defeated, as were his two motions last week relating to the composition of the board.
It will be interesting to see if his board representatives Lucy Gaffney and Paul Connolly turn up for today’s meeting. They received a chilly reception last week and ignored calls to explain why they were seeking to remove the chairman Brian Hillery from his post and have Baroness Margaret Jay replaced as the company’s senior independent director.
On November 26th, two more egms will be held to vote on the €98 million sale of INM’s profitable outdoor advertising business in South Africa and a proposed rights issue.
O’Brien has seen more than €500 million wiped from the value of his shareholding in Independent News Media. His stake was this week almost halved to 14 per cent following the deal with bondholders. Four attempts by O’Brien to cobble together an alternative restructuring plan were rejected by INM’s bondholders and banks.
So it’s back to the drawing board for the telecoms tycoon. Without doubt, he has been outmanoeuvred by the O’Reilly camp in relation to the bond debt.
Some believe it was down to a lack of focus. While O'Brien was raising dust in relation to various payments to directors, the loss-making Independenttitles in London and corporate governance issues, Gavin O'Reilly was striking a deal with bondholders – and one that stuck.
Not that the O’Reilly camp has anything to be smug about. This was a hollow victory. The bondholders now own 46 per cent of INM, which has a market cap of just €159 million.
That’s little more than Johnston Press (over)paid to buy a dozen or so regional newspapers in this country. It’s nothing to crow about.
