INDEPENDENT NEWS Media (INM) will no longer consolidate its Australian associate APN into its accounts following a number of changes to the board which reduce the Irish company’s influence.
The Australian media group, 31.6 per cent owned by INM, appointed Brett Chenoweth as chief executive to replace Irishman Brendan Hopkins, who steps down in December. INM board appointees Donal Buggy and Cameron O’Reilly will retire on January 1st, APN added.
John Harvey, a former senior partner with PricewaterhouseCoopers in New Zealand, will become an independent, non-executive director from that date.
INM chief Gavin O’Reilly will continue as APN’s chairman, while chief operating officer Vincent Crowley remains a board member.
The APN board changes will have no impact on INM’s stake in the Australian business, but require changes in the accounting treatment of its shareholding.
APN will no longer be consolidated into INM’s group financial statements from December 31st.
“INM’s exposure to Australasia and the diversification that it brings will be unaffected and this accounting change will have no impact on INM’s bank covenants,” INM added yesterday.
The change will have the effect of reducing INM’s debt level to about €510 million, roughly half its previous level, by stripping out APN’s borrowings. This is a technical change, as APN borrowings were always non recourse to INM.
Under international accounting rules, INM will no longer account for APN as a subsidiary undertaking as representatives of the Irish company will no longer be in a majority on the APN board.
This won’t affect INM’s net profit or earnings per share figures, but will reduce INM’s revenue and operating profit.
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