Month by month the Irish billionaire Denis O'Brien is buying up stock in Independent News & Media , taking him ever closer to the point at which he could have a say in the company's policy. The troublesome investor's growing stake must now be of genuine concern to INM's chief executive Tony O'Reilly.
Last week's purchase by O'Brien increased his stake to 21.16%, and he is now INM's second biggest shareholder. But, as the Irish Times has pointed out, O'Brien is inching towards the 25% threshold at which he can block certain resolutions put to shareholders.
Given O'Brien's persistent call for INM to sell the loss-making London-based Independent titles, that could mean him attempting to block any resolution connected to funding for those papers. They are part of the company's UK division, which also includes the profitable Belfast Telegraph operation.
O'Brien's recent purchases have been matched by O'Reilly's. He, his family and the INM board together own 28.2% of the company, an international media conglomerate with the major slice of the Irish newspaper market plus substantial holdings in South Africa, Australia and New Zealand.
Another possible headache for INM comes this week when it exits from the Dow Jones STOXX Global Select Dividend 100 Index on Tuesday. This will evidently result in the release of some six million shares on the open market, providing another opportunity for O'Brien to increase his stake or forcing O'Reilly into the market yet again.
Though O'Brien has never declared his strategy, he has been persistently critical of O'Reilly's stewardship of INM and there has been bad blood between the two for many years. O'Reilly has made out a case for retaining The Independent, despite its losses, because it is - in his view - a "calling card" that benefits his empire as a whole.
According to a Mail on Sunday story today (not online), INM will unveil, on Thursday, full-year results for the 12 months up to December 2007, which will show profits up by 15% to £238.5m on net sales of £1.39bn, some 4% above expectations. So O'Reilly is surely doing something right, eh Mr O'Brien?
