Independent On Verge Of Sell-Off?

Independent News and Media, who publish the Independent, are in another spot of financial bother. Aside from the newspaper that loses £10m a year, along with its website that looks like it’s stuck in 1998, it’s having to persuade creditors to accept new terms on a €200m bond rather than have it paid back right away.

It wants to roll over up to 70% of the bond into a new one, the carrot for the investors being greater interest; the remaining 30% or so will be funded by CEO Anthony O’Reilly and second-largest shareholder Denis O’Brien. They’re meeting resistance from some bondholders though, and O’Brien has said the chances of talks working out are only 50-50. And while the bond isn’t set to mature until mid-May, if they don’t sort it out before their financial results announcement on Thursday there are worries that auditors will make INM write down their investments. That would surely lead to some asset sales, despite the crappy climate, to add to the imminent sell-off of its online bingo hall Cashcade, German price comparison site Verivox, a South African outdoor advertising business, and others. Cue Lebedev, hoping to add to his burgeoning empire of failing UK newspaper titles?

It’s an ignominious end for O’Reilly, who is retiring next month – as well as the Indy potentially being sold off at a rock-bottom price (or conceivably tanking altogether), he also lost over a billion dollars in 2008. His retirement at least marks, however amicably, an end to the feud between him and O’Brien, in which the former accused the latter of “parking his tanks” on his lawn by buying up a 21% stake in INM; O’Brien in turn accused him of running an “old-style fiefdom” at the group, and that the Indy was merely a “vanity project”. But while O’Reilly’s son Gavin will take over as CEO, O’Brien now has a third of the board and 26% of the company. That’s gotta hurt.

Posted by Ben Beaumont-Thomas in Creative Economy | April 27, 2009 10:51AM |