Black Fails To Scupper £729 Million Sale Of Telegraph Titles
Lord Conrad Black’s last-ditch attempt to block the £729 million sale of the Daily and Sunday Telegraph to the Barclay brothers has failed after a Delaware judge rejected the media tycoon’s eleventh-hour appeals.
The ruling finally clears the way for the Barclay brothers to succeed in their long-held ambition of taking control of Britain’s best selling broadsheet newspaper later today. However, Black has dismissed the judge’s decision and is preparing an appeal.
Hollinger Inc said in a statement last night: “We regret the decision not to uphold the rights of Hollinger International’s shareholders to evaluate the proposed sale of the company’s U.K. assets. Hollinger Inc’s independent directors have decided to pursue an appeal of the ruling.”
Leo Strine, the judge who has been overseeing the legal disputes, emphatically rejected ‘piteous’ arguments put forward by Black in an attempt to delay the sale of the Telegraph titles. He accused the disgraced media mogul of abusing his position at Hollinger Inc and said that he had no right to a say over the future of the papers.
The sale of the Telegraph titles has been the subject of a long-running power struggle between Lord Black and minority shareholders in his US-based newspaper empire. Black was forced to resign as chief executive Hollinger International last year, but he is still in charge of Hollinger Inc, which holds 68% of the voting shares in Hollinger International (see Black To Step Down As Chief Executive Of Hollinger).
A new board of directors at Hollinger International agreed to sell the Telegraph titles to the Barclay brothers last month, but Lord Black tried to block the deal, claiming that they could not do so without taking the vote of shareholders.
Delaware law states that such a shareholder vote is only required for the sale of ‘substantially all’ of a company. Judge Strine last night ruled that the sale of the Telegraph titles did not fulfil this because Hollinger would retain other papers such as the Jerusalem Post and the Chicago Sun-Times.
The ruling ends months of uncertainty over the future of the Telegraph titles and senior executives at the company do not expect its change of ownership to cause any more turmoil. Chief executive, Jeremy Deedes, said recently: “We have got a new owner that thinks long term, that invests, that cherishes and exactly fits with what the Telegraph needed” (see Barclays Not Expected To Shake-Up Telegraph Group).
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