GAVIN O’REILLY resigned yesterday as chief executive of Independent News & Media, ending 39 years of direct control by his family of Ireland’s largest media group.
His move pre-empted any attempt by Denis O’Brien, IN&M’s biggest shareholder, to oust him at its upcoming annual meeting in June.
It is understood Mr O’Reilly took the decision to resign last weekend.
He will be succeeded by IN&M chief operating officer Vincent Crowley.
The exit followed a “compromise agreement” approved unanimously by the IN&M board, which includes two representatives of Mr O’Brien – Paul Connolly and Lucy Gaffney.
In a detailed and frank statement, Mr O’Reilly said: “After 19 eventful years with the company, it is time for me to pursue new opportunities.
“It had become clear that recent and public shareholder tensions were proving an unnecessary distraction for both me and the company and this was not in the best interests of the company.
“The board and I agreed that what the company needs now is a board, management team and shareholder base that is purposefully unified and aligned for the company’s immediate challenges and for the many opportunities that exist in the future.”
He said he was leaving with “mixed emotions”. Mr O’Brien, who owns 22 per cent of IN&M, declined to comment.
Speculation was rife in recent weeks that Mr O’Brien, with the support of other shareholders, possibly including financier Dermot Desmond, might seek to topple Mr O’Reilly at IN&M’s annual meeting.
Taoiseach Enda Kenny, speaking in Belfast, said the issue had been “brewing” for some time.
“The Government in its own way will have a reflection on this in terms of cross-ownership of media,” he said.
It is not clear if the compromise agreement will include any senior editorial changes at IN&M’s newspapers.
In recent weeks, Mr O’Brien and his associates have voiced their anger at what they perceive to be hostile coverage of the mobile entrepreneur by INM titles, particularly the Sunday Independent.
Mr O’Reilly was appointed CEO in May 2009 having previously held various senior management roles after being brought into the business by his father Anthony O’Reilly, who owns 14 per cent of the company.
IN&M chairman James Osborne said Mr O’Reilly “leaves by mutual and amicable agreement”.
He said Mr Crowley was “well equipped to position the group for the challenges which continue to face the media industry”.
After taking over in the wake of a painful financial restructuring of the business in 2009, Mr O’Reilly failed to stem the decline in its share price.
IN&M’s operating profit fell last year by 8.6 per cent to €75.5 million and it is in talks with lenders to refinance its €426 million debt.
