Hollinger International Rebuffs Buyout Offer

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(AP) Press Holdings International Ltd., the closely held British concern controlled by the billionaire Barclay twins, approached newspaper publisher Hollinger International Inc.’s bankers with an $18-a-share offer last weekend, Press Holdings said Wednesday in a regulatory filing.

Press Holdings, which has agreed to acquire control of Hollinger International parent company Toronto-based Hollinger Inc., said it was rebuffed by Hollinger International bankers.

But Press Holdings remains interested in talking to Hollinger International about a deal to buy the 70% of class A common shares that aren’t controlled by Hollinger Inc., a spokesman said. “We are very interested in finding a way forward,” the spokesman said.

Chicago-based Hollinger International is waging a legal battle to block Press Holdings’ deal to acquire the Hollinger Inc. stake of ousted Hollinger International chairman Conrad Black. Hollinger Inc. holds 30% of Hollinger International’s equity, but those shares carry 70% of the company’s voting power.

According to a Hollinger International release Wednesday, Sir Frederick Barclay indicated to the company’s representative that he was considering a price of $18 per share to buy out shareholders, but would need to discuss that issue with his brother, Sir David Barclay, who also controls Press Holdings.

No offer or proposal was ever made, and in a later discussion Frederick Barclay indicated he was no longer considering the $18 price, according to Hollinger International.

News of the overture sent Hollinger International shares soaring nearly 13%, or $1.92, to close at $16.71 Wednesday on the New York Stock Exchange.

Press Holdings owns several newspapers in Britain, including The Scotsman, as well as The Ritz hotel in London.

If Press Holdings acquires control of Hollinger International without board approval, it faces restrictions on its ability to run the company. Under section 203 of corporate law in Delaware, where Hollinger International is incorporated, in such a situation, the acquirer wouldn’t be able to sell assets for three years without the approval of 85% of the company’s minority shareholders. The buyer would also require minority shareholder support to alter the composition of the board.

The fight between Hollinger International and ousted chairman Black shifted from a dispute over his failure to repay $7.2 million in unapproved payments to a legal contest over his right to sell his Hollinger Inc. stake.

Hollinger International also is suing Black and former president David Radler to recover $200 million they accuse the men of taking from the company. On Wednesday, Hollinger International transferred the litigation suit from federal court in New York to Chicago. Hollinger International spokeswoman Molly Morse said the suit was moved because of jurisdictional reasons.

A spokesman for Black, Jim Badenhausen, reacted to the fresh filing by saying: “While we haven’t had the chance to see the complaint, it appears that Hollinger International’s addiction to litigation is continuing.”

Hollinger International owns London’s Daily Telegraph, the Chicago Sun-Times (Click for QuikCap) and the Jerusalem Post.

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