Black court move on Telegraph

PRESS baron Lord Black has launched a pre-emptive strike in the Canadian courts against the Hollinger International board ahead of its emergency meeting today to decide what to do about Black's surprise announcement of the sale of his controlling stake to the Barclay brothers.

With the board yet to weigh its options, Black, through his Ravelston and Argus companies, is seeking injunctions at the Ontario Superior Court of Justice to prevent Hollinger International from 'interfering with the continuation and completion of the takeover bid'.

'The offer by Press Holdings International will provide substantial value to all shareholders of Hollinger Inc as well as benefiting Hollinger International,' Black said.

Despite his action, it is far from clear Hollinger International's board could do anything about the £260m sale which would give the Barclays ownership of Black's main newspaper assets, including the Daily Telegraph.

Some Wall Street observers expect it to decide it is in the company's best interests to allow the deal to go through without contest. That would allow the board to focus on getting back the money it and key shareholders say Black owes the company.

Although Black was removed as chairman of the company at the weekend, he has rejected the suggestion that he no longer controls Hollinger International.

The money allegedly owed by Black is being investigated by a Hollinger committee headed by Richard Breedon, a former investigations chief at the US Securities and Exchange Commission.

The SEC has said it will oppose a change of ownership at Hollinger only if the committee's investigation is disrupted. The Barclays have said they would allow the investigation to continue.

Canadian regulators believe the key regulatory issue is not ownership but whether Black and others removed money from the company without authorisation and, if so, how much. The complex corporate structure created by Lord Black may make it vir tually impossible for Hollinger International, based in the US, to stop the sale.

The Barclays have agreed to buy 78% of Canadian company Hollinger Inc, which owns 30% of Hollinger International and controls 73% of its votes.

Hollinger Inc shares almost doubled yesterday, jumping C$3.79 to C$7.69.