Independent News & Media today declared Denis O'Brien a dissident shareholder, accusing the businessman of trying to destabilise the newspaper publisher.
'The board is now formally declaring Mr O'Brien a 'dissident shareholder', who consistently voices disagreement with the company's strategy while continuing to buy shares and who is not acting in the best interests of all stakeholders,' the company said in a statement issued this morning.
The telecoms billionaire has been building up his stake in the media group in recent months and now owns over 22% of the company, its second biggest shareholder after the O'Reilly family.
Today's statement from INM says that Mr O'Brien has made 'a series of personalised, misleading and inaccurate attacks on the company, its board, management, strategy and governance'.
Last year Mr O'Brien criticised corporate governance and close ties between board members at INM. Chairman Anthony O'Reilly rejected the criticism as partisan, but the spat and continued stake-building have triggered media reports of a feud between two of the country's best known billionaires.
In this morning's statement, INM said a letter from O'Brien sent in 2003 may explain his motives. 'He wrote to the company on 3 July, 2003, alleging that INM had 'spent the last seven years trying to destroy my reputation' and that he was 'waiting for the appropriate time to rectify the damage',' the group said.
'In the light of this, we believe it is reasonable to question Mr O'Brien's emotive reaction to the legitimate news coverage,' the company added.
Denis O'Brien has this afternoon responded to the INM statement. 'It is a highly personal and unwarranted attack on the company's largest independent shareholder and appears to be designed to deflect attention away from the company's disappointing stock performance,' Mr O'Brien said in a brief statement.
'I have always been, and remain, committed to investing for long term value for all shareholders and look forward to seeing signs of a similar approach from the board of directors,' he added.
Earlier this morning, Independent News and Media reported pre-tax profits, before exceptionals, of €286.1m for the year ending December 2007. This is an increase of 7.7% on the €265.7m figure reported for 2006.
Revenues rose by 2.3% to €1.674 billion from €1.636 billion, while adjusted basic earnings per share increased by 8% to 18.8 cent from 17.4 cent.
In its results statement today, INM said its advertising revenues grew by 5.4% last year, while its circulation revenues were up by 0.6%. The media group said that it has seen an increasing profit contribution from its associates and joint ventures, with its Indian operations - JPL - continuing to show strong growth.
The company said that revenues at its Irish operations decreased by 0.8% to €401.3m in 2007, while operating profits rose by 4% to €98.3m. Advertising and circulation revenues performed strongly, rising by 7.6% and 2.1% respectively. The group owns the Irish Independent, Sunday Independent, Sunday World, Evening Herald, and jointly owns the Irish Daily Star here. It also owns several regional newspapers, including the Sligo Champion which it bought recently.
Revenues at its Australasia operations grew by 3.7% to €769.4m, while operating profits rose by 6.4% to €192.7m.
INM's operations in South Africa saw its revenues fall by 10.7% to €234.7m, due to adverse currency movements. However, operating profits rose by 7.1% to €59.1m.
In the UK, its revenues jumped by 18.3% to €268.1m, while operating profits there were up by 8.4% to €15.5m. The company said this reflected improved profitability in Northern Ireland and a reduction in losses in The Independent and The Independent on Sunday titles.
'The business has traded well during the first three months of 2008, with group earnings ahead of last year and all regions growing total revenues in constant currency,' commented INM's Group CEO Anthony O'Reilly.
'Despite the uncertain economic background, we remain confident that, on the basis on trading in all our geographies, INM can deliver a further year of earnings growth,' he added.
Meanwhile, INM Chairman Anthony O'Reilly has further increased his stake in the company.
According to a stock exchange announcement this evening, he bought 10 million shares today at a price of €1.86 per share. Today's buy brings his total stake to 27.94%.
INM shares closed 11 cent higher at €1.84 in Dublin this evening.
