May 13 (Bloomberg) -- The action of three board members of Independent News & Media Plc in questioning the independence of a non-executive director is needless, Chief Executive Officer Gavin O’Reilly said.
Leslie Buckley, Paul Connolly and Lucy Gaffney, were appointed in 2009 as non-executive directors affiliated to Denis O’Brien, the company’s biggest shareholder. In April, Chairman Brian Hillery said in a letter to shareholders that the three directors no longer viewed Bengt Braun as independent because he shares membership of a world newspaper body with O’Reilly. Braun was appointed in March 2010.
“It is a fairly unusual position to take,” O’Reilly, who maintained that Braun is independent, said in a telephone interview today. “It is not an issue that needed to be an issue.”
The dispute may re-open a rift between O’Brien and O’Reilly over management of the company that ended about 18 months ago. In 2009 O’Brien said O’Reilly was “incapable” of leading Independent News & Media and that the leadership of the board didn’t have “credibility” as it sought to raise new equity and repay an overdue bond. Independent News said O’Brien was a “dissident” shareholder.
“Do I think we have suddenly reached the point of a commencement of hostilities, no I don’t,” O’Reilly said in the interview.
The three directors have recommended shareholders vote against adopting the company’s accounts at the annual shareholder meeting on June 3 because of their view of Braun’s appointment.
A spokesman for Leslie Buckley said he wasn’t available to comment when contacted by Bloomberg News. Paul Connolly could not be reached. Lucy Gaffney didn’t respond to messages. Bengt Braun couldn’t immediately be contacted by Bloomberg.
“I don’t think you’ll find institutional retail investors listening to this and saying ‘oh hang on a second, we can’t approve the accounts,” O’Reilly said.
Advertising conditions remain “challenging and the market in Ireland has yet to stabilize and remains very short-term and erratic,” the company said today in a statement distributed by the Regulatory News Service.
Independent News’s share price closed down 1 cent, or 1.67 percent, to 59 cents in Dublin trading, giving the company a market value of 324.8 million euros ($458 million).
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