By Max Goldbart, Tuesday 07 November 2017
The war of words between Johnston Press and one of its major shareholders has escalated after Johnston received a formal demand that former Scottish first minister Alex Salmond is installed as chairman and a number of current directors are removed from their posts.
Reports emerged late last week that Salmond, who lost his seat at the 2017 General Election, would become chairman as part of a takeover bid from Norwegian venture capitalist and Custos Media Group owner Christian Ager-Hanssen, who holds a 20% stake in the company.
In a statement, Johnston, which publishes around 300 newspapers including the i and The Scotsman, said that it had received a letter from Custos requisitioning a shareholders’ general meeting and proposing resolutions that Camilla Rhodes and Michael Butterworth be removed as directors, with Salmond and former ESI Media Group chief executive Steve Auckland slated as non-executive director replacements. It also said that any directors appointed after 6 November, the date of the requisition, be removed.
The Johnston Press board said it is consulting with advisers and will update shareholders with regard meeting timings in due course, with shareholders advised to take no current action.
A source close to Johnston described Salmond as a “career politician with no experience of leadership on media companies”, stating that the group was being derailed and its prospects impacted in the middle of a “complex and important” financing period.
“Despite dozens of interviews they [Custos] have not produced a coherent strategy or plan,” said the source.
Last week’s Johnston trading update showed group revenues, including classifieds, down 7% on the same period last year. The group is currently in the midst of a strategic review, launched in March, to find a solution to the repayment of £220m in high-yield bonds, which mature in June 2019.
London-headquartered media investor Custos describes itself as having a “passion for disruptive innovation”. With offices in Stockholm and Oslo, the 200-staff operation has sales of more than £50m and is the sole owner of subsidiary and Stockholm-based media company Metro Media House.