Black's Nemesis, Tweedy Browne, Demands New Info

23 August 2004

Tweedy Browne, the New York-headquartered institutional investor that last year felled Lord Conrad Black as chairman/ceo of Hollinger International [H-Intl], has turned its attention to other activities associated with that company's board.

Specifically, certain papers connected with insurance contracts, which, according to Robert Curry, an attorney representing Tweedy, will enable his client to 'determine the impact of insurance contracts on shareholder value'.

The papers would also 'enable Tweedy to investigate whether any Hollinger directors or employees had breached their fiduciary duties; and to evaluate whether there was a "valid basis" under which to bring action against the company".

H-Intl has agreed to comply with this request.

  • Meantime, H-Intl last week bought itself more time for the finalization of a year-long internal probe into the affairs of the company under the stewardship of Black and his associates. The report by a special board committee was due for publication on August 20.

    However, a number of new issues have recently been disinterred, while papers from external auditor KPMG were made available only during the last two weeks. The report, which will run to over four hundred pages, is now scheduled for publication August 30.

    It is also expected to pronounce on the role and responsibility of H-Intl's independent directors, among them the erstwhile US secretary of state Henry Kissinger and former Illinois governor James Thompson.

    The latter remains a director of the company despite call for him to stand down [WAMN: 12-Aug-04]. Thomson was specifically named by Tweedy Browne, which accuses that he and other group directors allowed ex-chairman Black and allied executives to divert into their own keeping nearly $400 million (€324.6m; £219.6m) rightly due to the company and its shareholders.

    Lord Black and others involved in these questioned monies have vigorously protested their innocence of wrongdoing, insisting that the board of H-Intl had approved the payments.

    Data sourced from: Financial Times and Wall Street Journal Online; additional content by WARC staff