Hollick gets ultimatum from Mirror board

LORD HOLLICK, the Labour peer, has been asked to pledge his full support for David Montgomery, chief executive of Mirror Group Newspapers, or resign from the group's board.

The ultimatum, delivered by MGN's chairman, Sir Robert Clark, came after after the peer objected to a board statement supporting Mr Montgomery and the measures he has taken to revamp the group, which publishes the Daily Mirror, Sunday Mirror, Sunday People and Sporting Life.

Lord Hollick, who heads the media and financial services group MAI, supported Mr Montgomery's appointment last November. He was absent from yesterday's MGN board meeting, having gone skiing earlier in the day.

Before he left he told Sir Robert that he could not 'support in full' a statement put out by the board. The statement said the board confirmed 'its confidence in the management and has authorised David Montgomery and his colleagues to continue the agreed strategy'.

The statement, which also emphasised MGN's policy of maintaining a left-of-centre stance for its newspapers, was agreed by the other 10 members of MGN's board, including the former Labour parliamentary candidate Sir Gordon Borrie, as well as John Talbot, administrator of the Maxwell private companies, who represents four banks controlling 54 per cent of MGN's shares.

Lord Hollick issued a statement last night, saying: 'I have raised a number of concerns. The chairman has informed me that the board would be looking into the matters and hopefully steps can be taken to enable me to give my full support.'

The concerns are understood to centre on the involvement of Mr Montgomery in editorial decisions and appointments.

The row between Mr Montgomery and the peer has been simmering for some weeks and came to a head after the resignation of Alastair Campbell, the Daily Mirror's political editor, and the appointment of David Seymour, a senior journalist from Today, as chief leader writer.

This prompted 150 Labour MPs, led by the former party leader Neil Kinnock, to table a Commons motion attacking Mr Montgomery. Lord Hollick was reported to have supported the motion.

The conflict between Lord Hollick and Mr Montgomery has also brought into question his position as a non-executive director of Hambros, the merchant bank recently appointed corporate adviser to MGN after advising Mr Montgomery and Lord Hollick about a possible bid for MGN last year.

The statement to which Lord Hollick was unable to agree was drafted by Antony Beevor, a senior corporate finance director at Hambros and the director who tends to deal with Hambros relationship with MAI.

Hambros has made it clear to Lord Hollick that in this situation its first loyalty is to MGN.