At the end of August 2012, the Irish Examiner reported that the Broadcasting Authority of Ireland (BAI) had written to Denis O’Brien’s Communicorp radio operation asking for an update on Denis O’Brien’s control of Independent News and Media (INM), the largest private media group in Ireland which publishes the (Irish) Independent, the Sunday Independent, the Evening Herald, Sunday World as well as provincial titles and in Northern Ireland, it publishes the Belfast Telegraph and Sunday Life. In July 2012, the BAI had previously concluded that Denis O’Brien “does not control IN&M. Rather he has a substantial interest in the Company, as that term is defined in the Policy. In this regard, the Authority was not obliged to review Mr. O’Brien’s interests in the context of an undue amount of communications media”, and the latest intervention by the BAI at the end of August 2012 was aimed at testing if this was still the case after the intervening appointment of Denis’s associate Leslie Buckley to the role of chairman at INM .
It seems that the 60 days expires about now, and the BAI ruminations will be closely studied, especially by those concerned or alarmed at Denis O’Brien’s growing control of Irish media, particularly in light of the adverse findings in the Moriarty Tribunal and a pattern of editorial interference by Denis or his associates, suggested by communication with Gavin O’Reilly and former chairman, James Osborne and attempted editorial interventions against Sam Smyth and to a much lesser extent, allegedly against Eamon Dunphy. The nation’s favourite curmudgeonly journalist Vincent Browne has also recently been on the receiving end of unpleasant correspondence from Denis. Sam Smyth has seen his contract terminated at Communicorp’s Talk Radio and it seems that Sam’s last article in the Independent was on 25th May 2012 – Vincent Browne claims that Sam has been ostracised. All of this comes after Sam Smyth’s writings about the Moriarty Tribunal, the adverse findings from which are disputed by Denis.
Today in Court 3 at the High Court today, Ms Justice Laffoy presided over a disjointed hearing where it was obvious both sides were engaged in intermittent discussions outside the courtroom aimed at a settlement. It was the third day in the case taken by IN&M’s director of corporate affairs and content management since 2010, Karl Brophy against what is now his former employer after IN&M tried to terminate his contract in April 2012, immediately after Gavin O’Reilly stood down as CEO amid frictions between Denis O’Brien and the O’Reilly family. Karl had been recruited in 2010 by IN&M – way back in 1998 when Karl was a political journalist, he had penned an article in the Irish Daily Mirror which resulted in a defamation action by Denis O’Brien where Denis received €750,000 compensation.
Today the current IN&M CEO, Vincent Crowley took to the witness stand and alas was only part-way through his evidence when a settlement was announced, so there was no cross-examination. In his 90 minutes of evidence, he painted a distressed picture of IN&M with falling circulation and advertising in its main market, the Republic of Ireland. Vincent was the former Chief Operating Officer (COO) of the company, and said today that he had two meetings with Denis O’Brien prior to his elevation to the main management role at the group on 19th April, 2012. He described his former role as “fluid” and it seems that his vacated role of COO is not being filled at the group.
The outlook at IN&M doesn’t look great. Vincent said that he originally planned to spend €40,000 on public relations in 2013, presumably most of it with Murray Consultants but he has since revised that up to €80-100,000 given the detailed discussions with the banks, continued cost cutting and dealing with pension issues. Evidence presented to the court included deliberations by Vincent Crowley on assuming the CEO role in April on several terminations; three were indicated to the court – his own COO role, Karl’s and the role of group treasurer – but there was also a redacted name which apparently is an exec who was spared. It also seems that the former CEO Gavin O’Reilly had considered making Vincent Crowley redundant. You’d have to wonder if anyone is safe at IN&M! Vincent described the position of the company when he assumed the CEO role as “perilous”. The stock price of INM is 10c today valuing the company at €52m, a shadow of its former billion euro plus valuation, and given the group is balance sheet insolvent to the tune of over €200m, you’d wonder if it is perhaps overvalued even at €50m.
As regards the Denis O’Brien angle in this present court case, it seems that a perceived attempt by Karl Brophy to unearth details of Denis O’Brien’s borrowings at Anglo and to bring those details into the public domain was a source of tension at INM, on account of Denis being a tax-exile who was being financially supported with loans by a bank 100%-owned by the taxpayer. Of course Denis’s spokesman has previously stressed that Denis pays tax in Ireland on income earned here, though we have not seen that tax quantified. There were also concerns at alleged leaks related to Sam Smyth and Eamon Dunphy, but it seems the main source of friction was Denis’s borrowings with Anglo, something which echoes claims made by former chairman James Osborne in a recent interview with the Sunday Independent’s editor Anne Harris. It’s not clear why this should be regarded as Krytonite by Denis, as it seems he has reduced his borrowings at Anglo and no-one has suggested his loans aren’t performing. INM argued in the case that Karl was terminated for cost savings reasons.
Karl was joined today in court by former CEO Gavin O’Reilly who sat beside him, and apparently the pair looked as if they had some fight left in them still. This evening, Karl has said on Twitter that he has no plans for the future “yet” and that he is no longer an employee of IN&M “as of today”. Gavin O’Reilly is understood to be busy with his hotel interests at present.
The settlement statement read to the court said that IN&M makes no allegation of wrongdoing against Karl Brophy and also that the decision to terminate Karl’s employment was the CEO’s, Vincent Crowley’s and that specifically, Denis O’Brien had “no hand” in the decision. Other details of the settlement are unlikely to make it into the press, but it seems that Karl’s contract provided for a 2-year severance which would amount to €600,000 in light of his reported €300,000-a-year salary.
600,000? Just about enough to pay a dozen journalists for a year. Even more at entry level.
@IrishTimorous, that’s probably true, but remember the terms of the settlement are confidential and were not revealed in open court today.
@NWL you perhaps overlooked another casualty in “sue’s” relentless march towards media domination and muzzling of the press.
Is Mick O ‘Kane still suspended,perhaps ‘sue’ is angling for his own knighthood like that prior plastic paddy that owned INM.
No too much support among his fellow journalists, their silence is noticeable including your pal VB.
You want check out TOP and BOTTOM pic.’s of Kate just Google her.
The sound of silence is deafening,yeah the Irish media too busy wetting their own beaks to make a stand,or even a statement in support of Mick.
“The Irish Daily Star is a joint venture between Express Newspapers’ parent company Northern & Shell, along with Independent News & Media, which is owned by Irish newspaper mogul Denis O’Brien.”
Read more: http://www.metro.co.uk/news/912016-kate-middleton-topless-pictures-published-by-greedy-irish-paper#ixzz2A9VfAgMR
Sue was at one time rumored to be Anglo’s biggest borrower. If true that would have put the borrowings north of €2 billion. Pure speculation seeing that there is almost a total blackout on information. One does wonder how some of these borrowings never made it to NAMA when almost everyone else’s did.
one word STROKESERVE…..except for in maybe some sh*t hole in the Caribbean or a sad pathetic AIDS infested third world dump,would an indebted borrower to a state owned bank ‘buy’ another company involving forgiving 100 million of debt,with no details on how he paid.
Not one Irish journalist asked how he bought it,NOT ONE.
Was it cash who know who cares………….did “Anglo’ lend him the money to buy it….how did he pay for it, bananas,phone credits, NOT one report on the dynamics of the transaction,a public company and a state owned bank, extremely controversial buyer.
But the Irish taxpayer took a 100 million hit here for Dennis.
Here is the ludicrous,toothless,spineless pathetic competition authority on it,how did he actually PAY for it……….ah sure who cares..no sh*t Sherlock i bet none of them did,which Minister signed off again………
“During the investigation, the Authority sought the views of a number of
third parties, comprising competitors, customers and suppliers of
Siteserv and/or companies controlled by Denis O’Brien. In particular,
the Authority sought the views of third parties involved in the
electronic communications and media infrastructure sectors. None of
these third parties raised concerns specifically about the proposed
transaction. The Authority also consulted with the Commission for
Communications Regulation, which did not raise any concerns about
the proposed transaction.”
http://www.tca.ie/images/uploaded/documents/M-12-002%20Millington%20-%20Siteserv%20public.pdf
So,how many of you will still buy O briens paper on Sunday?
@ NWL…
In relation to the ratio of what the company is worth to what the the company debts are, I think you are overegging the pudding, well that is all down to the cost of servicing the debt.
The majority of home owners are balance sheet insolvent, due to the fact that they have a mortgage which is a multiple of their income. But what is important is the cost of servicing the loan / debt, stress testing, and the cost of borrowing etc.
INM may be balance sheet insolvent, but of all the companies / countries / households in the world, there are very very few who are actually balance sheet solvent. However INM are attempting to release cash from assets in S.Africa.
No doubt about it INM is in trouble, and the company has suffered a minor civil war internally, trying to keep the company afloat when the staff are squabbling so much is not easy.
In relation to DOB putting his mark on the company, perhaps it is wrong that there is a clearout occurring?
But so what……. in the private sector, if a employee continually needles the employer it is inevitable that action will be taken, ways / methods are devised to move the offender on. I knew of one person in one large accounting company who made such a disaster of a clients project, that she was moved to an empty desk. Eventually after a week she resigned herself, rather than the company terminating her contract. There are ways and means of moving non team players / under performers off the pitch.
INM is not unique in that respect, there are politics in all companies, especially large ones.
When you write about “Concerns about DOB’s control of the media” what exactly is meant by that?
Are you suggesting DOB would prefer more articles about golf, and less about rugby? Or should the independent Woman section be reduced and the health section increased? Is this what you are referring to?
Or are you concerned that the publications become a Pravda tool for Fine Gael?