In a colourful exchange, Lord Conrad Black of Crossharbour dismissed with acerbity the concerns of Christopher Browne as to whether his lordship is in a position to sell ten million of his voting preference shares to Hollinger International’s largest shareholder Southeast Asset Management [WAMN: 06-Jun-03].
In a grand gesture designed to appease Hollinger's major institutional shareholders, Black declared at the company’s annual meeting he would loosen his voting stranglehold on the group by divesting himself of these shares.
But one such shareholder, Christopher Browne, managing director of investment firm Tweedy Browne which holds 18% of Hollinger, is dubious as to Black’s intentions.
“If I were a betting man,” quoth Browne, “I’d bet that it doesn't happen. Maybe it's something [Black] did to stave off rebellion at his annual meeting. There are a million ways for anyone to get out of the deal.”
His doubt about the peer's intentions is not mere cynicism. Technically, the shares are not Black’s to sell, being held as collateral by bondholders of ultimate parent company Hollinger Incorporated.
His Lordship was displeased at this lack of trust. “There are plenty of ways of skinning that cat,” he huffed. “This issue of not releasing security is nonsense. You can forward sell stock, you can sell stock in Hollinger Inc, translate it with Hollinger International stock. You can do all kinds of things. Even the imagination of Christopher Browne should be capable of leaping that hurdle”.
But some onlookers believe the implications of Black’s penultimate sentence are precisely the reason for Browne’s dubiety.
He is also concerned at the $73 million (€61.71m; £43.78m) in extra-curricular fees pocketed by Black, his wife and other senior Hollinger honchos, allegedly diverting these from company’s coffers – and is threatening legal action to recover them for shareholders.
Hollinger’s board is said to be close to hiring an independent adviser and legal counsel to aid its investigation into the fee payments.
Data sourced from: MediaGuardian.co.uk; additional content by WARC staff