INDEPENDENT NEWS Media (INM) has denounced an attempt by rebel investor Denis O’Brien to depose its chairman and senior independent director, arguing that their removal would hinder its efforts to settle an overdue €200 million bond “outside a court-administered process”.

Although a “standstill” on more than €1.3 billion of debt expires today, INM expects that its bondholders and banks will extend the moratorium in anticipation of a refinancing deal.

INM and its bond investors and lenders are close to agreement on a package including a debt-for-equity swap, a discounted rights issue and an extension of the maturity on more than €1.1 billion in bank debt.

Two days ago, Mr O’Brien made a last-minute investment proposal to the firm’s banks in which he promised to invest €100 million upfront in return for a majority stake in INM. Its banks, including AIB and Bank of Ireland, are examining the proposal.

Mr O’Brien’s surprise approach came less than a month after he requisitioned an extraordinary general meeting (egm) to remove chairman Brian Hillery and senior independent director Baroness Margaret Jay.

Urging shareholders to endorse both individuals in the best interests of the company at the egm on November 3rd, INM threw out six other resolutions from Mr O’Brien.

There was no comment from Mr O’Brien on a board circular to shareholders, which said INM’s board and chairman had particular responsibilities “in circumstances where there is a serious risk of the restructuring discussions failing and of the company being unable to continue as a going concern outside a court-administered process”.

INM rejected a resolution directing the disposal of the loss-making London Independent titles, arguing that this would result in an immediate upfront cash cost of €35 million for breaking contracts.

Mr O’Brien also wanted to block a €100,000 annual payment to a company controlled by non-executive director and former Canadian prime minister Brian Mulroney, but INM said such payments will cease at the end of the year “in light of the challenging financial circumstances” it faces.

Although three directors nominated by Mr O’Brien took a dissenting position, the INM board said that his proposals were an attempt to interfere with its valid authority to conduct its normal business.

INM said it was not tabling Mr O’Brien’s resolution to direct the company to cease preparations for the sale of South African advertising business INM Outdoor, a key refinancing deal, on the basis that the proposed sale will be put to shareholders at a separate egm.

It rejected resolutions to close a London office and investigate directors’ expenses.

Also rejected was a resolution to stop annual payments of €300,000 to former chief Sir Anthony O’Reilly on the basis that he has no contract as president emeritus and received no fees in respect of that role.