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UPDATE 2-Custos to push for Alex Salmond as Johnston Press chairman
November 7, 2017 / 9:18 AM / in a month

UPDATE 2-Custos to push for Alex Salmond as Johnston Press chairman

(Adds comment from investor)

By Maiya Keidan

Nov 7 (Reuters) - Johnston Press Plc’s biggest shareholder, Custos Group, said on Tuesday it would push for the appointment of Scotland’s former nationalist first minister, Alex Salmond, as the British newspaper publisher’s chairman.

JPR, publisher of the Scotsman newspaper that opposed independence for Scotland in 2014 vote, said it received a letter from Custos, demanding a shareholder meeting to oust interim Chairman Camilla Rhodes.

In the letter, Custos sought resolutions to remove Michael Butterworth and Rhodes as directors and proposed the naming of Alexander Salmond and Steve Auckland as non-executive directors.

However, Custos Chief Executive Christen Ager-Hanssen told Reuters that the plan is to first have Salmond on the board and then have him elected as chairman.

If the board opposes Salmond’s election, Custos would propose a special resolution to name him as chairman, Ager-Hanssen said.

Custos has also sought to remove any person appointed as a director of the company since Nov. 6. The investor owns a 20.22 percent stake in Johnston Press, according to Thomson Reuters data.

Johnston Press said it was consulting with its advisers and will update its shareholders with regard to the timing of the general meeting in due course.

Custos was forced to delay a call for a general meeting after discovering a clause in a bondholder deal that hindered its attempt to oust the newspaper publisher's top management, The Telegraph reported in October. (bit.ly/2h8Gz77)

The activist investor had lined up four directors to be nominated to the board before finding out in October that it would not be possible to proceed due to a so-called “dead hand proxy put”.

Ager-Hanssen said at the time that they were considering all options and that the board or the CEO had not done anything to build up Johnston Press.

The call for changes to Johnston Press board comes at a time when newspaper industry is hit by the migration of advertisers to online platforms, forcing print publishers, such as Trinity Mirror and Daily Mail and General Trust, to cut costs drastically.

Last week, shareholder Crystal Amber Fund cut its stake in Johnston Press to 10.48 percent from 18.15 percent.

Johnston Press has also been undergoing a strategic review to assess financing options available in relation to its 220 million pound ($289.39 million) senior notes which become due for repayment on June 1, 2019.

The stock was up more than 6 percent at 14.35 pence on the London Stock Exchange. ($1 = 0.7602 pounds) (Additional reporting by Arathy S Nair in Bengaluru; Editing by Amrutha Gayathri and Anil D‘Silva)

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