bucking

Editorial Cartoon by Graeme MacKay, The Hamilton Spectator – Tuesday January 20, 2004

Black: Sacked, sued and selling

Conrad Black’s days as a newspaper baron are over.

Capping months of turbulence and accusations of self-dealing and diverting company money, Black agreed yesterday to sell his controlling stake in Hollinger Inc. to British billionaire twin brothers David and Frederick Barclay as part of a takeover offer valued at $605.5 million.

The Barclay brothers’ Press Holdings International Ltd., which already owns several British newspapers including the Scotsman, as well as London’s Ritz Hotel, would pay $423.8 million in cash and assume debt of $181.7 million.

The Barclays said they have an irrevocable agreement with Ravelston Corp., Black’s investment vehicle, to buy its 78 per cent stake in Hollinger Inc. The brothers will then offer to buy out minority shareholders.

“I am delighted that we have been able to enter into this agreement and I have no doubt that the financial strength and direction that we can bring will allow the group to flourish, ” said David Barclay, whose company is based in the Channel Islands between Britain and France.

Based in Toronto, Hollinger Inc. controls U.S. subsidiary Hollinger International Inc., the publisher of the Chicago Sun-Times, the Jerusalem Post and flagship London Daily Telegraph.

Hollinger Inc., which as recently as 1999 controlled 60 per cent of Canada’s daily newspapers, still owns 13 Canadian dailies, including the Kamloops Daily News in British Columbia, and Quebec’s Sherbrooke Record.

In a statement yesterday, Black said it would be “distressing” to part with the newspapers, “but these fine titles must not be hobbled any longer by the current controversies and financial uncertainty.”

Black’s agreement to sell his interest in the media empire came a day after Hollinger International announced it had fired Black as chairman and filed a $200 million (U.S.) lawsuit against Black, his investment firms, and David Radler, Black’s former top director. The company alleged Black, a member of Britain’s House of Lords, siphoned company money away from investors and altered financial statements. (Toronto Star, 1/19/2004, A1)