INM 'should be' run for Denis O'Brien and Dermot Desmond

The then chairman of Independent News & Media (INM) suggested in 2016 that the group should be run so as to maximise returns for shareholders Denis O'Brien and Dermot Desmond, according to a court document.

Robert Pitt, the group's then chief executive, objected to the suggestion from Leslie Buckley and said the company's board had an equal responsibility to all shareholders, according to the affidavit.

Mr Buckley is a long-time business associate of Mr O’Brien’s and was his nominee on the board. Mr O’Brien is the largest shareholder in the company, with 29.9 per cent of the group’s shares. Mr Desmond is the second largest, with 15 per cent.

The claim about Mr Buckley was made by Mr Pitt in a protected disclosure to the Office of the Director of Corporate Enforcement in 2016. It is cited in an affidavit from Director of Corporate Enforcement Ian Drennan who is seeking the appointment of High Court inspectors to INM.

When the application came before Mr Justice Peter Kelly yesterday, he adjourned the matter to allow for judicial review proceedings being taken by the company, which is seeking to prevent Mr Drennan's application proceeding.

In his disclosure, Mr Pitt said that on January 25th, 2016, senior management at the company met Mr Buckley to discuss a strategy document being prepared for the board.

“Mr Pitt asserted that, during the course of the meeting, the chairman [Mr Buckley] had indicated that the priority should be to maximise returns to the two main shareholders, ie Mr O’Brien and Mr Dermot Desmond, as they had invested significantly in INM in recent years,” said Mr Drennan in his affidavit.

“According to Mr Pitt, the chairman stated that he had not discussed this approach with the major shareholder [Mr O’Brien]. Mr Pitt objected to this position, noting that the board had an equal responsibility to all shareholders.”

An independent review was established by INM to look into concerns expressed by Mr Pitt about several matters, including the alleged comments by Mr Buckley.

According to Mr Drennan, the review concluded in relation to the comments that “no specific wrongdoing was alleged” against Mr Buckley and that “nothing concrete was alleged to have occurred as a result of these comments” .

Accordingly, says Mr Drennan, the reviewers found “no evidence of wrongdoing or potential wrongdoing in respect of this allegation.”

Mr Buckley has said he will defend himself robustly against all allegations in Mr Drennan’s affidavit.

Mr O’Brien has yet to comment on the controversy. And a request for comment from Mr Desmond also met with no response.

A company spokesman said he had no comment to make about Mr Pitt’s claim. INM yesterday filed a replying affidavit to Mr Drennan’s, but it has not been opened in court. Mr Desmond may respond to Mr Pitt’s claims through the courts.