Paul Connolly, a longtime business associate of Denis O'Brien, has emerged as a leading candidate to replace Leslie Buckley as chairman of newspaper publishing group Independent News & Media (INM).
Mr Buckley, who is at the centre of an investigation into INM by the Office of the Director of Corporate Enforcement (ODCE), announced on Friday that he will resign from INM’s board. He will leave following an extraordinary general meeting of shareholders on March 1st.
INM says a replacement for Mr Buckley, who is main shareholder Denis O’Brien’s nominee to the board, will be announced after the meeting.
Mr Connolly, Mr O’Brien’s other nominee, is abroad and could not be reached for comment. Sources speculated he may take over as chairman on an interim basis, although INM said Mr Buckley remains in situ until March.
INM thanked Mr Buckley for his 5½ years’ service. It also announced an overhaul of its board of directors, which was depleted over the past year following several resignations amid a period of unprecedented corporate turmoil at the group.
Four new non-executive directors will join INM, subject to shareholder approval. John Bateson, managing director of 15 per cent shareholder Dermot Desmond's IIU Nominees and one of his closest confidantes, will join the board.
He replaces Mr Desmond's previous nominee, David Harrison, who resigned abruptly just before Christmas.
Fionnuala Duggan, managing director of digital company KNect365 Learning, will also join. Murdoch MacLennan, deputy chairman and former chief executive of the Telegraph Media Group in the UK, is also set to become an INM director. In addition, former KPMG partner Seamus Taaffe has agreed to join the board.
The proposed appointments will be put to a vote of shareholders at the egm.
INM also announced that Allan Marshall, an Australian-based director of the group, will leave the board at the same time as Mr Buckley.
The group has endured 15 months of intense outside scrutiny following a slew of revelations concerning boardroom disputes involving Mr Buckley, as well as a State investigation into a suspected data breach.
Its former chief executive Robert Pitt, who fell out with Mr Buckley over an abandoned proposal for INM to buy Newstalk from Mr O’Brien, made a whistleblower complaint to the ODCE, the State’s corporate watchdog.
Its chief financial officer, Ryan Preston, also made a protected disclosure about the chairman.
An ongoing attempt by the ODCE to force Mr Buckley to release documents it is seeking from him as part of its investigation into the suspected data breach and other matters is due back in the High Court on Monday. Mr Buckley this month filed fresh written testimony in the case.
The ODCE has demanded to know from Mr Buckley who paid the bill for outside cybersecurity consultants, who were facilitated to gain access to the newspaper publisher’s internal IT systems. ODCE also asked him to explain how this access benefitted the company.
"It is the right decision for Leslie Buckley to step down in light of developments within the company last year," said David Holohan, chief investment officer at Merrion Capital.
“The new director appointments will strengthen the board at a time when INM will need to invest its significant €90 million of cash surplus that is only modestly below the market value investors attribute to the overall group,” he added.
INM’s share price wobbled immediately after the announcement of Mr Buckley’s departure, falling as much as 6.3 per cent before rallying to close up 4.3 per cent.