Osborne may be voted off INM board today
INDEPENDENT News & Media’s chairman, James Osborne, and other directors face the prospect of being voted off the board at its annual meeting in Dublin today.
It is understood that Dermot Desmond, who owns 6.36 per cent, has already cast his proxies against the re-election of Mr Osborne and other directors, with the possible exception of Paul Connolly and Lucy Gaffney, who represent Denis O’Brien on the board.
Mr O’Brien, who owns just under 30 per cent of INM, has yet to cast his votes but there was a growing expectation last night that he could vote against the re-election of Mr Osborne, who became chairman last October.
Finance director Donal Buggy will also be under pressure to retain his position on the board.
Chief executive Vincent Crowley and non-executive directors Frank Murray and David Reid Scott are also up for re-election.
Mr Murray has served nine years on the board, while Reid Scott was appointed in December.
Mr Osborne has clashed with Mr Connolly over his decision to pursue a legal action against the €1.87 million exit package paid to former chief executive Gavin O’Reilly on April 19th. This action is expected to conclude in the Commercial Court today.
On April 26th Mr Osborne asked Mr Connolly to resign from the board of INM after he initiated his legal challenge. The board has recommended to shareholders that they oppose Mr Connolly’s re-election.
Mr O’Brien is expected to seek a poll for each vote relating to the election of directors.
Lothar Lanz yesterday became the latest INM non-executive to step down from the board. Baroness Margaret Jay and Bengt Braun also recently retired as non-executives.
Mr Osborne told the Commercial Court yesterday that he decided Mr O’Reilly’s position as chief executive had become untenable once INM’s banks lost confidence in him. The “tipping point” that led to a consensus among INM directors that Mr O’Reilly had to go was a series of “quite extraordinary” emails and a meeting between Mr O’Reilly and Bank of Ireland, Mr Osborne said.
Asked by Michael Cush SC, for INM non-executive director Paul Connolly, whether what Mr O’Reilly had said to the bank constituted “bizarre behaviour”, Mr Osborne replied: “When you owe somebody €423 million, it is probably not a good idea to send emails accusing them of various things.”
Mr Osborne was being cross-examined on the second day of the action by Mr Connolly, who is seeking a declaration that the payment was unlawful.
Mr Osborne, a lawyer who has been on the boards of eight public companies, said the INM board had agreed the termination package for Mr O’Reilly following legal advice and in order to avoid time-consuming litigation. He told Mr Cush it became clear to him last March that Mr O’Reilly was no longer the right person for the job.
Legal submissions have begun and the hearing is expected to conclude today.