On November 10th, 2016 the Competition and Consumer Protection Commission (CCPC), which signs off on mergers and takeovers, approved Independent News & Media's planned takeover of Celtic Media Group.
This came just over two months after INM announced that it wanted to take over the regional newspaper group, which owns the Anglo-Celt in Cavan, the Meath Chronicle and the Connaught Telegraph.
The acquisition would have increased the size of the INM, the country's largest media company, which already owned regional newspapers including The Kerryman, the Sligo Champion and the Wexford People.
Legal papers filed by Director of Corporate Enforcement Ian Drennan last month in his bid to seek the appointment of High Court inspectors to INM reveal confidential contacts between various parties who had an interest in whether the merger should proceed, including Minister for Communications Denis Naughten.
According to the sequence of events outlined by Drennan in his affidavit and emails reproduced in his court papers, Eoghan Ó Neachtain, the director of public affairs at public relations firm Heneghan PR, telephoned Minister Naughten on the afternoon of November 11th, 2016 about the takeover.
Mr Ó Neachtain told The Irish Times this week he was hired by INM, a client of the PR firm, to find out the Minister's reaction to the decision of the CCPC not to block the proposed takeover and to see if Naughten intended to refer to the Broadcasting Authority of Ireland, which signs off on mergers of media companies.
The decision by the CCPC raising no competition concerns about the merger effectively put the proposed acquisition back on the minister’s desk for consideration.
The CCPC reviews media mergers on their narrow economic impact, while the BAI examines proposed mergers on a cross-media ownership basis and whether it damages media plurality.
An email sent by Nigel Heneghan, managing director of the firm where Ó Neachtain works, to INM's then chairman Leslie Buckley at 9.36am on November 12th, 2016 outlines details of Ó Neachtain's conversation with the minister the previous afternoon.
Heneghan wrote that the minister told Ó Neachtain that based on the advice of his officials he would refer INM’s proposed acquisition of Celtic Media to the Broadcasting Authority of Ireland for review because of the level of ownership of media companies, broadcast and print, by Denis O’Brien, INM’s biggest shareholder.
“The information, following Eoghan’s call with the Minister which happened yesterday afternoon, is based on advice from his officials, he will pass it to the Broadcasting Commission [sic] of Ireland for review, because of the overall ownership of print and broadcast titles by DOB [Denis O’Brien],” wrote Heneghan.
Heneghan concluded his email to Buckley telling him that this information was “to be treated as highly confidential as the minister has not been officially informed yet of the CCPC decision.”
The email was, according to Drennan’s affidavit, forwarded by Buckley to O’Brien at 10.07am.
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Inside information’
Drennan claims that the information communicated by Buckley to O’Brien - including this November 12th, 2016 email - may fall within the definition of inside information given that INM is a public company and that, as a result, Buckley may potentially be in breach of stock market rules, namely Market Abuse Regulations.
The State’s corporate watchdog said that this and eight other communications “raises significant concerns that the chairman [Buckley]was sharing information with the major shareholder [O’Brien]in advance of that information being available to INM’s other shareholders.”
Ó Neachtain told The Irish Times this week the minister told him on their telephone call that, regardless of the CCPC's decision, he was going to refer the proposed takeover to the BAI.
On November 23rd 2016 the minister told The Irish Times in an interview he had not considered INM's takeover of Celtic Media, despite his reported remarks to Ó Neachtain.
"I haven't got the recommendations yet from my officials and as soon as I do I will weigh all that up," he told Irish Times journalist Laura Slattery in the interview, which was published in early December 2016.
In a February 7th, 2017 reply to a parliamentary question, Naughten said that following approval of the merger by the CCPC, he received notification of the proposed merger on November 21st, 2016.
In his reply, the minister said that he had 30 working days from the notification deadline of November 24th 2016 to conduct an initial assessment on whether the merger should proceed as it may be contrary to the public interest in protecting the plurality of the media in the State.
Following this initial assessment, or “phase one examination,” he decided on January 10th, 2017 to ask the Broadcasting Authority of Ireland to conduct “a full media merger examination of the proposed transaction.”
The BAI was given 80 days to examine if the takeover would be damaging media plurality in Ireland given that it would have increased INM’s ownership of regional newspapers from 13 to 20.
In the end, INM and Celtic Media decided to walk away from the proposed deal by mutual consent in June 2017 shortly before the Minister was due to consider the BAI’s report on the acquisition.
- Full text of email sent to then Independent News & Media chairman Leslie Buckley by public relations executive Nigel Heneghan at 9.36am on November 12th, 2016. This refers to the conversation Eoghan Ó Neachtain, director of public relations at Mr Heneghan's PR firm, had with Minister for Communications Denis Naughten the previous afternoon about his view of INM's takeover of regional newspaper group, Celtic Media Group, after the decision of the Competition and Consumer Protection Commission not to block the proposed acquisition. Mr Buckley forwarded Mr Heneghan's email to businessman Denis O'Brien, a 29.9 per cent shareholder in INM, at 10.07am with the note: "FYI – Leslie"
Dear Leslie,
Note the attached article on the acquisition of CMG [Celtic Media Group] in the Irish Times this morning.
The information, following Eoghan’s call with the Minister which happened yesterday afternoon, is based on advice from his officials, he will pass it to the Broadcasting Commission [sic]of Ireland for review, because of the overall ownership of print and broadcast titles by DOB [Denis O’Brien]. To be treated as highly confidential, as the Minister has not been officially informed yet of the CCPC decision.
Kind regards
Nigel
