Lord Conrad Black of Crossharbour, chairman/ceo of debt-beset Hollinger International, looks set to hula out of the hoop of his promise to sell between five and ten million class A common shares to the company’s biggest minority shareholder, Southeastern Asset Management of Memphis, Tennessee.
In a grand gesture designed to appease Hollinger’s major institutional shareholders, Black declared at the company’s annual meeting last month that he would divest himself of these shares – and also loosen his voting stranglehold on the group by phasing out the super-voting Class B shares, through which he controls 73% of the company [WAMN: 23-May-03]. The latter move would have reduced Black’s stake to around 42%.
But it emerged at Wednesday's annual meeting of the parent company, Hollinger Inc , that His Lordship cannot comply with either undertaking because the shares are pledged as collateral to bondholders of the parent company - a scenario he dismissed with contempt when raised by a shareholder at the earlier meeting.
“There are plenty of ways of skinning that cat,” Black assured the May meeting. “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” [WAMN: 11-Jun-03].
But not, it seems, sell them to Southeastern Asset Management.
At yesterday's gathering Black lost no opportunity to attack those minority shareholders critical of his management style, accusing them of “well-poisoning”. He also dismissed the issue of corporate governance and $200 million in fee payments to himself, his wife and other Hollinger executives as a “sideshow”.
Of like irrelevance was specificity about the performance of the group’s main properties, the Chicago Sun-Times and Britain’s Telegraph Newspapers. Both had “weathered the worst advertising recession since the 1930s”, Black claimed while eschewing hard numbers. “We have sown the seeds of prosperity.”
Data sourced from: The Wall Street Journal Online; additional content by WARC staff