Creditors Close In on Lord Black

19 July 2004

US bank Wachovia Corporation has written to beleaguered former Canadian peer Lord Conrad Black of Crossharbour, demanding that Hollinger Incorporated [H-Inc] file its financial accounts within the next thirty days.

Failure to do so, threatens the bank, will trigger a demand for immediate repayment of loan notes to the value of $78 million (€62.72m; £41.69m) -- a situation that would impel His Lordship into a second financial restructuring of H-Inc, likely requiring the sale of yet more shares in Hollinger International [H-Intl], the unit through which Black controls his publishing properties.

Assuming that His Lordship can rush out the numbers in time, the heat is off, giving him another eleven years to come up with the cash. But in a classic Catch 22 situation, H-Inc can't file the accounts as it depends on its rebellious subsidiary H-Intl doing the same.

And H-Intl says it can't do so because of the alleged -- and as yet unresolved -- financial malpractice that occurred during the peer's former reign as chairman/ceo.

Hence Black's upcoming lawsuit against H-Intl which he hopes will force it to release the fiscal data. Meantime, among his many other problems he faces shareholder litigation plus investigations by US and Canadian securities regulators.

There appear to be a number of exceptions to the old proverb: "Everybody loves a lord."

Data sourced from: Times Online (UK); additional content by WARC staff