International media baron Conrad M. Black resigned as chief executive of his holding company Monday after disclosures that he and other executives collected millions of dollars in unauthorized payments.
Black, a swashbuckling entrepreneur who renounced his Canadian citizenship two years ago so that he could become an English lord, stepped down as part of a management shake-up that included the resignation of the publisher of the Chicago Sun-Times.
The departures follow an investigation by an independent audit committee into Black's media holding company, Chicago-based Hollinger International Inc. The audit committee, led by former Securities and Exchange Commission Chairman Richard Breedon, determined that Black had funneled $16.55 million to Hollinger's Toronto-based parent company, Hollinger Inc., after the sale of several newspapers in the United States and Canada.
He also had given himself and his deputy, President and Chief Operating Officer F. David Radler, who also was the Chicago Sun-Times publisher, $7.2 million each in 2000 and 2001 without informing the company's board. Two other associates received $1.2 million combined.
The audit committee determined that the amounts were "not authorized or approved by either the audit committee or the full board of directors of Hollinger [International]," according to a company statement issued Monday.
The statement said Black, Radler and one of the two other recipients have agreed to repay Hollinger International the full amount of the unauthorized payments, together with interest. The fourth recipient, Executive Vice President J.A. Boultbee, could not reach an agreement with the company over the non-compete payment and was fired, the company said.
Black said he would continue as non-executive chairman of Hollinger International and as chairman of the Telegraph Group, which owns the Daily Telegraph here as well as the Spectator, a conservative political weekly. But media analysts here believe both will soon go on the auction block, stripping Black of the flagship publications that gave him influence and prominence in London. Hollinger International said it had hired Lazard to explore the possibility of selling either the entire company or key assets.
Black, 59, arrived here from Canada in the mid-1980s and purchased the Daily Telegraph, Britain's largest broadsheet with a circulation of nearly 1 million. He was credited for modernizing the newspaper, changing its look and its columns and bringing in prominent British journalist Max Hastings as editor.
The company's largest U.S. newspaper is the Chicago Sun-Times, the tabloid competition to the Chicago Tribune. It has about 475,000 readers, about 200,000 behind the Tribune.