Dr Tony O'Reilly is to take executive control of the Independent News and Media group when the current chief executive, Mr Liam Healy, steps down on May 1st. The group has also announced plans to float the mobile telephone information company, iTouch, later this year.
The group's shares, benefiting from the strong rise experienced by international media shares in the wake of the AOL/Time Warner merger, rose 95 cents to €7.25 (£5.71) yesterday, a new high. Dr O'Reilly (63) will become executive chairman when Mr Healy steps down on May 1st next. The chief executive post will not be filled and the divisional heads will report to Dr O'Reilly.
Sources said it was expected that Dr O'Reilly would remain in the position for the next five years at least and would supply the "long-term vision" required for the development of the group, while being supported by a strong team of divisional directors.
Dr O'Reilly, who is currently chairman of the group, was involved in Independent's move into Australia and South Africa, and his taking on the position of executive chairman was "not such a big move", said a source close to the group. The development will see Independent "get more access" to Dr O'Reilly.
The move will not necessarily see Dr O'Reilly, who stepped down as chief executive of Heinz two years ago, spending more time in the Republic, according to the source. He has not been tax-resident in the Republic since the 1970s.
"Independent is a worldwide company and it can be run from wherever he is," the source said. "Tony is going to run the company until he feels it is time to move on. When that time comes, the right person for the job will replace him, based on ability," the source added. One market analyst said the development would be viewed positively among international investors. "Independent is probably coming back into expansion mode and that requires a different approach. O'Reilly is good at marketing and strategy and that is exactly what is needed."
The analyst said that, in four to five years time, "the environment may bear no resemblance to the one that exists today" and it was therefore important for Independent to have a strategic thinker like Dr O'Reilly in charge. "This will be perceived internationally as a very positive step."
He said the issue of having one person acting as both chairman and chief executive was not perceived as such a big problem in most markets. "If the company is performing, the investors won't complain."
Mr Healy, the current chief executive of Independent News and Media, has held the position since 1991 and is to become non-executive deputy chairman. Mr Healy will take over from Mr John Meagher, who will become a member of the group's international advisory board.
Dr O'Reilly said: "I would like to pay a warm tribute to Liam Healy, who has been an outstanding chief executive and has led the development of Independent News and Media during the period in which it has become a major international communications group."
Independent has an effective 70 per cent shareholding in iTouch, a mobile telephone data company founded in Cape Town but now based in London. It is planned to launch iTouch on both the US and European market some time in the coming six months. It is hoped to raise up to $150 million (€145 million) by floating 20 to 25 per cent of the company, according to one source. Funds raised would be used on marketing and the speeded up roll-out of the company.
Mr Ivan Fallon, chief executive of Independent News & Media Holdings, South Africa, has been appointed executive chairman of iTouch International.
ITouch was founded five years ago and has been operating services in South Africa in partnership with Independent group newspaper titles and Vodacom, a South African affiliate of Vodafone. It is currently in the process of establishing services here as well as in Britain, Australia, and New Zealand. Independent has invested about £40 million in the company, mainly in the form of promised advertising space in its newspapers.
