INM board­room bat­tle ends with res­ig­na­tion of CEO Pitt

Belfast Telegraph - - BUSINESS - BY DONAL O’DONO­VAN

IN­DE­PEN­DENT News & Me­dia (INM) CEO Robert Pitt re­signed yes­ter­day, end­ing a high pro­file stand off between the CEO and the chair­man of the Ire­land’s lead­ing me­dia busi­ness.

In a short state­ment re­leased to the stock ex­change, the com­pany said that Robert Pitt had de­cided to leave the busi­ness, with ef­fect from to­day to pur­sue other in­ter­ests.

The 46-year-old leaves the com­pany, which pub­lishes ti­tles in­clud­ing the Belfast Tele­graph, Sun­day Life and Ir­ish In­de­pen­dent just over three years af­ter be­ing ap­pointed CEO and less than two years af­ter he joined the INM board.

But his de­par­ture was prob­a­bly in­evitable fol­low­ing a pub­lic show­down in Au­gust, when as CEO he failed to sup­port the re-elec­tion of INM chair­man Les­lie Buck­ley in a show of hands at the com­pany’s an­nual gen­eral meet­ing in Dublin.

All INM di­rec­tors up for re-elec­tion at the meet­ing, in­clud­ing Mr Buck­ley, were re­turned with back­ing from large ma­jori­ties of share­hold­ers and their fel­low di­rec­tors. That left the CEO, who was not up for re-elec­tion, iso­lated and in the unique po­si­tion of serv­ing un­der a chair­man he’d pub­licly re­fused to sup­port.

The AGM was the pub­lic nadir of re­la­tion­ship between the two that had be­come in­creas­ingly strained over the pre­vi­ous year, fol­low­ing a dis­agree­ment over a po­ten­tial bid for ra­dio sta­tion New­stalk.

The dis­pute is un­der­stood to have come down to the price INM might pay for the sta­tion – with the CEO sup­port­ing a low- er val­u­a­tion than the chair­man was pre­pared to con­sider. Com­pli­cat­ing mat­ters is the fact New­stalk is owned by INM’s big­gest share­holder De­nis O’Brien, who is a close and long time busi­ness as­so­ci­ate of Mr Buck­ley.

In fact, the New­stalk deal never pro­gressed, but af­ter­wards the CEO com­plained about the process to INM’s se­nior non-ex­ec­u­tive di­rec­tor, Jerome Kennedy. He then also made a for­mal com­plaint to the Of­fice of the Di­rec­tor of Cor­po­rate En­force­ment (ODCE) un­der the Pro­tected Dis­clo­sures Act 2014, a law that pro­tects cor­po­rate whistle­blow­ers.

The ODCE has yet to re­port on its ex­am­i­na­tion of the is­sues, but at INM the board ini­tially ex­am­ined the is­sues it­self and then com­mis­sion­ing an in­de­pen­dent re­view by bar­ris­ter David Bar­niville which was com­pleted at the end of Au­gust with­out any ma­jor rec­om­men­da­tions for ac­tion.

Mean­while, the sit­u­a­tion between Robert Pitt and Les­lie Buck­ley was never re­ally re­solved, at least un­til yes­ter­day’s an­nounced de­par­ture.

The an­nounce­ment is un­der­stood to have fol­lowed lengthy talks between rep­re­sen­ta­tives of the two sides.

In its short no­tice to the stock mar­ket last night INM did not name a re­place­ment for the CEO, how­ever it is un­der­stood that an in­terim ap­point­ment will be made within days.

The im­passe at the top of the busi­ness took place against an al­ready dif­fi­cult back­ground for me­dia com­pa­nies, and had ham­pered the com­pany’s own abil­ity to re­act strate­gi­cally to the chang­ing mar­ket.

An ac­qui­si­tion pro­gramme cen­tred on INM’s €85m fi­nan­cial war-chest was put on hold as a re­sult of the board level split the com­pany told share­hold­ers over the sum­mer.

Piled on those dif­fi­cul­ties was a shock prof­its warn­ing in July, cit­ing a litany of “chal­lenges” which to­gether were noted as hav­ing a ma­te­rial im­pact on the com­pany bot­tom line.

While fac­tors that were al­ready known such as fall­ing cir­cu­la­tion and ad­ver­tis­ing were to the fore in the warn­ing, it also re­ported that un­ex­pect­edly high li­bel pay­outs in a num­ber of re­cent cases had hit prof­itabil­ity and had prompted man­agers to re-pro­vi­sion against any fur­ther losses.

Costs stem­ming from the fall­out at board level were also large enough to be cited in the trad­ing up­date, un­der­stood to have in­cluded the costs of INM’s in­de­pen­dent re­view and of on­go­ing en­gage­ment with the ODCE. To­gether those bills are un­der­stood to run into seven fig­ures.

INM it­self re­mains prof­itable, how­ever, and its ti­tles are mar­ket lead­ers across on­line and print at na­tional and re­gional lev­els.

Res­ig­na­tion: Robert Pitt

Newspapers in English

Newspapers from UK

© PressReader. All rights reserved.