CONRAD BLACK, the proprietor of the Telegraph, yesterday faced criticism of the sale by Hollinger, his Canadian holding company, of a big stake in the Telegraph group shortly before the daily newspaper slashed its cover price.
A Stock Exchange investigation has been launched into dealings in the Telegraph in view of the dramatic collapse in its shares following the move.
But Mr Black said he had spoken to the Stock Exchange at midday yesterday and offered officials internal minutes and the opportunity to interview staff as evidence of the sequence of events surrounding the decision on the cover price.
Mr Black said that although the Telegraph had first slipped below the psychologically important 1 million circulation figure for the first time in April, it was the surge in the Times's May sales which had made the group decide to slash its cover price. 'The fact is, our competitive position had been eroded,' he said yesterday. 'We sell a page of advertising for three times what the Times does. Now their circulation has moved up to half of ours.'
The relevant circulation figures had not been available until the first week of June, he said. He had not received the advice of his management committee to cut the price until 14 June. The price cut had been discussed until the decision was formally taken on Tuesday, after telephone conversations with most of the company's non-executive directors.
Mr Black said he could not have envisaged the cover price decision, a highly price-sensitive issue, at the time Hollinger sold the shares. The Stock Exchange is understood to have been reassured by his explanation. But it is continuing its inquiry into all recent share dealings in the company.
Share dealings this month have included the sale on 15 June of 552 shares by another Telegraph director, Stephen Jarislowsky, who is also a Hollinger director.
An article in yesterday's Independent incorrectly referred to the sale rather than the purchase of 552 shares in the Telegraph group by one of its directors, Stephen Jarislowsky, on 15 June. We apologise for any embarrassment caused.