O'Brien claims London titles costing INM €285 million

Businessman and media owner Denis O’Brien has fired another salvo in the latest battle for control of INM by accusing his fellow board members of allowing the Independent titles in the UK of drumming up costs of €285 million since the newspapers were first acquired in the mid-1990s.
O’Brien, who owns a 26 per cent stake in INM, has been calling for the sale or closure of the London Independent and Independent on Sunday which the group bought from Mirror Group Newspapers for a reported fee of €75m. Since then, O’Brien alleges, the titles recorded €7.5m in losses during the first two years of INM’s ownership and there was a drain of €195m in losses since 1996.
O’Brien is opposed to the €98m sale of INM’s outdoor business in South Africa as part of the settlement proposal with its bond holders who are owed €1.3 billion. INM was due to repay €200m on the bond issues in May but has secured extensions on the deadline while efforts are made to restructure group debts.
Gavin O’Reilly, chief executive, INM, said it was time for serious behaviour and not personal vendettas or wrestling control of the group for self-gain. He said that if O’Brien has a strong proposal to put to shareholders, he should do so. The board had agreed a road map to restore financial stability.
INM expects the Independent titles in the UK to break even within 15 months. if they were to close them down, they would have to pay out on a guarantee of €30m.
There were reports over the weekend that a number of potential investors in INM had made approaches, not least from the German publishing giant, Axel Springer. Yesterday’s Sunday Independent reported on a three-way phone conversation between O’Reilly, O’Brien (in Ibiza) and Paul Connolly signalling “a new phase in the battle for INM”.
During the exchange, which took place in late August, O’Reilly is said to have noted a comment by O’Brien stating: “I will destroy you and your father and I will go after everything”. A claim made by O’Brien’s spokesman, James Morrissey, on yesterday’s Marian Finucane show that O’Reilly taped the phone call was denied by a spokesman for INM.
At a board meeting on August 19th, one of O’Brien’s three nominees on the INM board, Lucy Gaffney, clashed with Baroness Margaret Jay and questioned her independence.

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