APN News and Media Ltd., publisher of the New Zealand Herald newspaper, slumped the most in two months in Sydney trading after its chairman and chief executive officer resigned amid pressure from its largest shareholder.
Shares of the company fell 8.3 percent, the most since Dec. 14, to 27.5 Australian cents at the close in Sydney. Chief Executive Officer Brett Chenoweth, Chairman Peter Hunt, and three independent directors have resigned because of a disagreement with Independent News & Media Plc., the company said in a regulatory statement yesterday.
Independent News and fund manager Allan Gray Australia Pty., the company’s two largest shareholders with about 51 percent of shares, “unequivocally indicated they are opposed to a capital raising” that the directors planned so as to raise cash and pay down debt. Peter Cosgrove, a former Independent News director, will replace Hunt as chairman, APN said today.
APN needs to sell about A$100 million ($103 million) of new shares, about half its market value, to reduce net debt to about double its earnings before interest, tax, depreciation and amortization, according to Samantha Carleton, an analyst at Credit Suisse Group AG in Sydney.
Independent directors Melinda Conrad, John Harvey, and John Maasland will leave immediately along with Hunt and Chenoweth, while Kevin Luscombe will retire in April as previously planned, the Sydney-based company said yesterday.