As Gavin O'Reilly tries to manage crisis, O'Brien camp says only “weeks” remain to save INM

In the red corner, here’s the Irish Times

The end of the dispute between the [O’Reilly and O’Brien] camps follows pressure from Independent’s banks — AIB and Bank of Ireland among them — to cast aside their differences ahead of a looming deadline for repayment of a €200 million bond in May.

Independent [News & Media] is now considered unlikely to have the proceeds from asset sales in place before the bond falls due, leading to a likely requirement for bridging finance from banks. 

And in the blue corner, here’s Gavin O’Reilly, speaking to James Robinson of the Guardian during the weekend:

“It’s the greatest conspiracy theory since Kennedy got shot. . . I don’t know where half this stuff comes from. There was no deal. . . We haven’t discussed any of this with the banks.

‘We decided the major shareholders needed to be on the same page. We started talking in the autumn and it was clear we had far more in common than most people would have thought. The old man and Denis – who’d never met before – struck up a friendly relationship.”

The way Gavin O’Reilly describes it, the outbreak of peace between the O’Reilly and O’Brien factions was entirely self-generated. 

Really? If all it took to end this bitter dispute was a friendly chat between two tycoons last November, external shareholders are entitled to ask why the hell it didn’t happen sooner.

If this were North America, shareholders would be reaching for their favourite contingency fee lawyers. They’d be instructing them to sue the living daylights out of Sir Anthony O’Reilly for unnecessarily prolonging a confrontation with Denis O’Brien that began in 2006.

But this isn’t North America. And it wasn’t just O’Reilly Snr’s pride that was at stake in this struggle.

Genuine differences in strategy were visible. These are differences that will have a bearing on INM’s ability to pay dividends and interest on its loans in the future.

Bankers and shareholders have a legitimate interest in such things. It stretches credibility for Gavin O’Reilly to suggest that neither constituency made known its views.

But let’s not be too harsh. O’Reilly Jnr.’s cry of “no conspiracy” is entirely understandable. Apart from an understandable desire to help his father depart with dignity, Gavin O’Reilly is engaged in an effort to damp down growing concerns about INM.

On Friday, it looked as if this PR offensive was proceeding fairly well. Then, on Saturday, the FT spoke to Denis O’Brien’s people.

Interviewed by the FT‘s Ben Fenton, a source in the O’Brien camp suggested that INM is enduring “force majeure times”. Remarkable as it may seem, the same source claimed that INM could face ruin within weeks.

Bravado generated by a corporate victory? Perhaps.

But the FT‘s Lex column — hardly a haven of hyperbole — joined the chorus on Saturday, too. Specifically, Lex voiced concern that INM has postponed announcement of its 2008 results by three weeks, to 24th April.

The unveiling of these financials, Lex suggested, will “be the toughest audit yet” for the company created by Sir Anthony O’Reilly.

Footnote: In the FT over the weekend, Ben Fenton also squeezed the following quote out of a source close to Denis O’Brien: “If it [the Independent] can be saved, we will save it.”

At the Guardian, James Robinson received a simple “yes” from Gavin O’Reilly after asking him whether the Independent will remain part of IN&M in the “medium term”.

O’Reilly’s quotes would add up to good news for journalists working at the Independent — If only it wasn’t for the gloomy noises emanating from the O’Brien camp about INM as a whole.

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