One of the most powerful newspaper tycoons in the world found his empire asunder Monday as
announced sweeping management changes following revelations of unauthorized payments to CEO Conrad Black.
Out is Black, who also goes by "Lord Conrad M. Black of Crossharbour," along with F. David Radler, Hollinger's president and chief operating officer, and Mark Kipnis, the vice president and corporate counsel, and J.A. Boultbee, the company's executive vice president. Boultbee was shown the door after he couldn't come to terms on repayment terms.
The company also said it hired investment bank Lazard and legendary dealmaker Bruce Wasserstein to review alternatives, including a possible sale of the company.
Black and Radler have spent the last three decades assembling a far-flung newspaper empire that includes the
. The company does about $1 billion a year in revenue.
The shakeup follows a finding by a committee of Hollinger's board that the company's parent, Hollinger Inc., made $32 million in unauthorized payments to senior executives between 1999 and 2001. Of those payments, which were described as "non-competition" stipends related to the sale of newspapers, Black and Radler eached received about $7.2 million. Boultbee got $600,000.
Black and Radler agreed to repay the money with interest.
"Hollinger's prior public disclosure relating to these matters was incomplete or inaccurate in some respects," the company said in a release. "The $16.55 million in payments to Hollinger International have not previously been publicly disclosed in the notes to Hollinger's financial statements or in filings with the
Securities and Exchange Commission
Black explained his "retirement" as follows.
"Now is the appropriate time to explore strategic opportunities to maximize value for all shareholders of Hollinger International. We are delighted that Bruce Wasserstein and his team at Lazard will be working with us to ensure the market is well aware of the substantial value of the Company's assets.
"Reflecting my full support of this process, I will be devoting my attention in coming months to achieving a successful outcome for all Hollinger shareholders. The present structure of the group clearly must be renovated. As the strategic process proceeds we will continue to cooperate entirely with the special committee to resolve corporate governance concerns."