INM shareholders reject resolutions by major investor

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The Independent Online

Irish group Independent News & Media expects a restructuring deal to be finalised before the latest extension to its overdue debt payments expires on 23 December, chief executive Gavin O'Reilly said today.

O'Reilly was speaking at a meeting at which shareholders of the publishing group defeated resolutions proposed by its second biggest investor Denis O'Brien to remove Brian Hillery as chairman and to appoint a new senior independent director.

"We would hope to have all aspects of the restructuring done before then," Gavin O'Reilly told reporters, referring to the 23 December deadline, the latest of several extensions granted to a 200 million euro ($296.5 million) bond originally due in May.

The Dublin-based media group agreed a refinancing deal in September to swap 123 million euros of the bond for a 46 per cent equity stake and then hold a rights issue for the balance of the note, including interest due, up to 94 million euros.

The rights issue will be fully underwritten by the bondholders, who will end up with a stake of around 47 per cent if all existing shareholders subscribe to the issue.

If existing investors do not subscribe to the rights issue, bondholders would end up with a 76 per cent stake in the group, publishers of The Independent and The Independent on Sunday in London.

The Independent News board had recommended shareholders vote against O'Brien's resolutions today at the first of three emergency general meetings this month.

O'Reilly, whose family holds the largest number of shares in the group, said the rejection of the two resolutions - around two-thirds of the voting shareholders voted against them - reflected support for the company's restructuring plan.

"It's very much an endorsement on the boards position on the future direction of the company," O'Reilly said.

"If the vote today can be reflective of the support of management of the board, I think it can be reflected of the support of the company's restructuring."

Independent News & Media will hold a 10 November meeting of holders to approve the restructuring plan and two further EGM's on separate O'Brien resolutions later in the month.