- Media mogul Conrad Black was accosted by a swarm of reporters
in Toronto Tuesday as he headed to an Indigo bookstore to launch his new
biography on F.D. Roosevelt.
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- The reporters wanted to hear his reaction to the announcement
Monday that he will be stepping down as Hollinger International Inc.'s
chief executive officer after being accused of accepting unauthorized payments
of millions of dollars.
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- Hollinger says that from 1999 to 2001, "a total
of $32.15-million US in payments were made that were not authorized or
approved by the full board of directors of Hollinger."
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- Those payments were made to Black, three of his associates,
and companies Black controlled. Black himself received more than $7 million.
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- Black told reporters at Hollinger Inc.'s downtown Toronto
headquarters: "You're exaggerating this. It isn't much of a story.
I'm still here."
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- Hollinger International says investors were never told
the full story behind these payments: "Hollinger's prior public disclosure
relating to these matters was incomplete or inaccurate in some respects."
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- Reporters Tuesday asked Black whether he had anything
to say to his shareholders.
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- "Yeah. I hope they're pleased. The stock's rising
like a rocket," he quickly replied. "I think they're delighted
with the rising stock price. So they should be."
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- He then vehemently insisted that he was not pushed out
of his job.
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- "The board didn't force me to resign. We agreed
on a package of measures to help demonstrate how seriously we took this
problem, that these people hadn't documented otherwise unexceptionable
money transfers and you've got to deal with it. It's a serious matter and
you've got to deal with it. So you take your lumps and move on."
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- Asked whether he regrets his role in the matter: "There's
no suggestion of impropriety -- read the press release," Black responded
curtly, noting that he will remain non-executive chairman of the company.
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- "I'm still the chairman, I'm still the chairman
of the parent company, I'm still the controlling shareholder... And I made
50 million bucks yesterday. That's a flame-out I could get used to,"
he said.
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- The questions from reporters didn't stop once Black entered
the book store, forcing Indigo CEO Heather Reisman to cut off questions
from reporters and to threaten to call security to clear the "intolerable''
media crush.
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- The payments were dubbed "non-competition payments,"
which are intended to ensure that a seller will not re-enter the markets
of the properties he is selling. The fees were linked to the Hollinger
group's $3.2-billion Cdn sale of the National Post and the former Southam
dailies to CanWest Global Communications of Winnipeg in 2000.
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- The U.S. Securities and Exchange Commission is currently
reviewing the findings of a special committee of Hollinger International
directors, and will likely seek permission soon to begin a formal probe
of the company, reports The Globe and Mail.
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- Hollinger admitted last week it had filed false financial
statements with the SEC in New York, a concession that may lead to the
eventual breakup of the company.
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- Ontario Securities Commission spokesman Eric Pelletier
declined to say whether it would launch its own probe. He would say only
that the securities watchdog is aware of the issues.
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- "In the case of reviewing any company's disclosure,
we might move to collecting more information or meeting with company officials
to sort of get their view of events, but that's not anything we would comment
on relating to any specific company."
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- Also resigning is Hollinger president and chief operating
officer David Radler. He will also be stepping down as publisher of the
Chicago Sun-Times. Senior Hollinger executive Peter Atkinson has also resigned
as members of the Hollinger board, although Atkinson remains executive
vice-president of Hollinger.
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- Black, Radler and Atkinson will repay the unauthorized
payments with interest by next June, according to the Hollinger statement.
Parent company Hollinger will also make a repayment.
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- With the growing scandal, the Hollinger board has hired
investment banking firm Lazard LLC to review "strategic alternatives,"
including the sale of the company or some of its major properties.
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- According to the Times of London, possible buyers include
the Washington Post and the British media company Daily Mail and General
Trust. Hollinger's assets include the London Daily Telegraph, Chicago Sun-Times
and Jerusalem Post.
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- Black's departure as CEO takes effect Friday.
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