IN&M says O'Brien claims 'outrageous'

Independent News & Media (IN&M) chief operating officer Gavin O'Reilly has accused dissident shareholder Denis O'Brien of an "outrageous" attempt to impugn his father Sir Anthony O'Reilly, chief executive of the group and its dominant shareholder.

After IN&M defended its corporate governance at its annual meeting in Belfast yesterday, Mr O'Reilly suggested Mr O'Brien was not qualified to question the group as he has done.

The group has projected earnings growth of in the 10 to 12 per cent range this year.

Owner of an 8.35 per cent stake in IN&M, Mr O'Brien has questioned the expenses the group pays Sir Anthony and circulated a report which said IN&M risked being branded a "crony" firm which serves Sir Anthony's interests over minority shareholders. Mr O'Brien was not present at yesterday's meeting.

"It's an easy target to look at myself and my two brothers. I fined it slightly outrageous that this shareholder would seek to impugn my father who has essentially created this company," Mr O'Reilly said.

"He took a small company back in 1973 and turned it into one of the first class media companies in the world. There isn't anything as far as I'm concerned in Mr O'Brien's history in terms of running media that makes me feel he's well qualified to make those comments."

He said IN&M was running the business to maximise the value for shareholders. "It's unfortunate that we seem to have a very audible shareholder who seems to use megaphone tactics but then I think we saw a bit of that last week at the tribunals."

Sir Anthony dismissed Mr O'Brien contention that directors for more than nine years could not be independent. He declined to comment on Mr O'Brien's motivation. " I think a degree of difference arose on the issue of nine years being a criterion as to whether a person who was independent for nine years turns into a frog in 10 years and becomes unindependent."

Mr O'Brien voted against the re-election of several non-executive directors, but all were re-elected and all agm resolutions were passed. An extraordinary general meeting (egm) passed all six resolutions on share purchases and other issues, but a resolution on the declaration of beneficial interests cleared the 75 per cent threshold by little more than two percentage points.

Mr O'Brien had criticised that resolution as "retrograde". However, deputy chairman Liam Healy said it simply gave IN&M power to secure information on share ownership that would otherwise require a court order. Mr O'Brien's representative Andrew Clearfield said the structure of the IN&M board was more like a "wholly controlled family company rather than a large public company traded in Ireland and the United Kingdom".

IN&M director Brian Mulroney dismissed that argument and Mr O'Brien's governance report. "The suggestion in the report seems to be that integrity and competence cannot co-exist with friendship. If so that's where we part company because a person of integrity will always do what he or she believes to be right irrespective of the impact on friendship or any other consideration.

"Of all of the companies of which I am associated, none, let me repeat that, none of the companies exceeds Independent News & Media in the integrity of its officers, the probity and transparency of its procedures and the genuine concern it has to ensure that the rights of all its shareholders are paramount at all times."