The undeclared battle for control of Independent News & Media (IN&M) has intensified after billionaire businessman Denis O'Brien questioned the expenses the group pays to Sir Anthony O'Reilly, its dominant shareholder and chief executive.
Mr O'Brien, who has an 8.35 per cent stake in IN&M, has in recent weeks written seven letters to board figures in which he questions aspects of its governance.
He asked whether IN&M pays staff, other costs, expenses or allowances in respect of Sir Anthony's private homes in Fitzwilliam Square, Dublin; Castlemartin, Co Kildare; and Lyford Cay in the Bahamas. The letter was sent to IN&M directors Dr Ivor Kenny and Brian Mulroney, former prime minister of Canada.
A spokesman for IN&M said last night: "Were such payment to have been made that would have to be listed as a benefit-in-kind in the annual report. There is no such entry". He gave the same response about whether IN&M ever chartered a boat for Sir Anthony's use.
Asked by The Irish Timeswhether IN&M paid business expenses to Sir Anthony for costs incurred in his private residences, he said: "Where Independent uses the private residence of any executive for a company function, the costs related to that function or event having been appropriately approved are paid for by the company."
Mr O'Brien's questioning of IN&M's governance, through an Isle of Man company he owns called Baycliffe, emerges only days before the group's annual general meeting next Wednesday in Belfast.
Mr O'Brien has not declared whether he ultimately plans to bid for IN&M, but this week signalled his intention to vote against a change to IN&M's internal rules which would increase the group's power to closely monitor any increase in his shareholding.
IN&M's spokesman said he wondered why questions were being asked, the answers to which were clearly set out in its annual report and accounts.
He said the group will respond to Mr O'Brien's letters before the agm and responded on Thursday to a letter of May 3rd which questioned the independence of 10 directors, two of them sons of Sir Anthony.
IN&M's spokesman said that the group's directors were satisfied that it complies with the principles and provisions of official corporate governance rules. The board determined that 11 of its 14 non-executive directors were independent non-executive directors. "This is clearly a majority of the board and fully complies with the provisions of the combined code."
Mr O'Brien's spokesman said he had yet to receive IN&M's response to that letter.
