Tuesday 28 February 2017

INM chair and CEO split over strategy

Donal O'Donovan

Donal O'Donovan

Leslie Buckley
Leslie Buckley

Boardroom tensions at the top of Independent News & Media (INM) boiled over and became public last night with the company confirming differences had arisen between chief executive and chairman over a planned acquisition.

The stock market-listed company, which publishes the Irish Independent, took the rare step of issuing a statement confirming an issue had arisen between the group's chairman Leslie Buckley and chief executive Robert Pitt in relation to the terms of a possible acquisition by the company.

Last night, speculation in the marketplace was that radio station Newstalk may have been the mooted acquisition that could have led to the split between chairman and CEO.

INM declined to comment. Newstalk is part of businessman Denis O'Brien's Communicorp Group. Mr O'Brien is also the largest minority shareholder in INM.

The company is known to be keen to expand in the digital space and, according to one source, is keen on acquiring digital TV assets as well as glossy magazine titles.

At the weekend it was reported tensions between former Tesco Czech Republic executive Mr Pitt and chairman Leslie Buckley had arisen over strategy at the publishing group.

The row comes as Mr Pitt approaches his third year in the group, which has a sizeable bank balance and is on the acquisition trail. Mr Buckley has previously said he wanted INM to be a digital company with print assets.

To date the company has not acquired any digital assets (apart from the remaining 50pc of cars Ireland which the company hadn't owned previously) - at home or abroad - but continues to dominate the domestic and diaspora marketplace online through Independent.ie. The only acquisition in the pipeline is Celtic Media Group, a small regional print group, and that awaits approval of Communications Minister Denis Naughten.

In a statement released last night after the market closed, INM said it noted recent press speculation and said an issue had arisen at board level between the chairman and chief executive about a possible deal.

The issue was reviewed by a sub-committee of the group board, which found no issue of concern for the company, INM said in a statement last night.

"Independent News & Media plc, noting recent media speculation, confirms that an issue arose between the chief executive officer and the chairman in relation to the terms of a possible acquisition by the company. Discussions on the possible acquisition ended at a preliminary stage and the acquisition was never considered by the board. The CEO raised the issue with the company's senior independent director. The board established a sub-committee to review the issue and the sub-committee reported to the board that no issue of concern arose for the company. The board has, with the agreed absence of the CEO and chairman, unanimously adopted the committee's report," the company said.

"The board and the company's management remain fully focused on the business and in ensuring that day-to-day operations are conducted as normal," it said.

INM is the country's leading commercial media organisation, publishing market-leading titles including the Irish Independent, 'Sunday Independent', 'Sunday World', 'The Herald' and Independent.ie.

Mr Pitt has said acquisitions are central to his strategy to shift the future of the group away from print into the future, and he has flagged there is a war chest of €62m available for deals. At board level, it is thought there were tensions about the strategy around where to spend the cash.

Separately, INM is due to hold an emergency general meeting of shareholders next Monday to vote on a proposed capital reduction that could pave the way for the group to resume payment of a dividend.

Irish Independent

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