Rebel investor proposes alternative rescue plan for Independent News & Media
24 September 2009
Denis O'Brien, the rebel investor in the publisher of The Independent, Independent News & Media with a 26-per cent holding in the stricken company, told the company's lenders that he would invest €100 million from his own funds in return for gaining control.
O' Brien's cash would serve to partly pay an overdue €200 million bond, however he would need to win the confidence of the company's lending banks, which are owed a further €1.1 billion. His representative met with lenders in Dublin yesterday morning.
A spokesman for Independent News & Media said that O'Brien's proposal was 'highly unlikely to deliver significant value to the banks and bondholers and it would probably require the company going into bankruptcy first. However the bankruptcy claim has been denied by O'Brien's camp.
The latest move comes as the company run by Gavin O'Reilly, confirmed that that it was finalising its own rescue proposal to deal with the bond that is four months overdue as the publisher does not have the cash on hand to pay the debt.
Analysts say with the O'Reilly plan gaining support, O'Brien was left with not choice other than to make the intervention he made yesterday to show that he had a concrete alternative beyond his intention to vote against anything that O'Reilly and his father Sir Anthony proposed.
The company has been forced by the rebel investor to hold a vote on the proposed rescue at an extraordinary meeting due at the end of next month following leakage of the O'Reilly scheme – an emergency meeting that will also force shareholders to decide whether they want The Independent to close down for good.