Judge blocks Telegraph sale

THE battle for control of the Telegraph newspapers was back on today after a US judge barred Lord Black from selling his controlling company to the Barclay brothers.

Black immediately called on investment bank Lazards to speed up the sale of the titles owned by Hollinger International, which alongside the Daily and Sunday Telegraph include the Chicago Sun-Times and the Jerusalem Post.

His company, Hollinger Incorporated, said: 'Both Hollinger Inc and Lord Black look forward to the prompt and effective pursuit of Lazards' work, and to the presentation to International and Hollinger of a course producing value superior to that presented by the Barclays' tender offer and proposed bid for International.'

In a Delaware court last night Judge Leo Strine blocked Black's $466m (£250m) sale of Hollinger Inc (Black's company which owns 30% of International but has 70% of the votes) to the Barclay brothers and prevented him from interfering in Hollinger International's auction of its assets to other buyers.

'As for Black himself, it became impossible for me to credit his word,' said Judge Strine, adding that he found Black 'evasive and unreliable'.

He said Black had promised he would not interfere with the restructuring of the company and sale of its assets, but that everything he did subsequently undermined that commitment.

Black 'misrepresented facts to the International board, used confidential company information for his own purposes without-permission, and made threats, as he would put it, of multifaceted dimensions toward International's independent directors,' he said.

The judge said Black agreed to the process simply to give himself time to do a deal with the Barclays which 'breached his fiduciary and contractual duties persistently and seriously', because Hollinger shareholders would have lost out.

Black's attempt to change Hollinger's by-laws, giving him more control, was no more than an attempt to make sure the Barclays deal went through, and was therefore invalid.

But Hollinger's counter-measure of eliminating the special voting rights that would have given the Barclays control was a legitimate method of trying to thwart the deal.

The judge also said that in public filings with US and Canadian regulators, the Barclay brothers had released information 'that is of questionable accuracy'.

Hollinger International welcomed the ruling, saying it was in the interests of all its shareholders.

Who's still in the running

BLACK'S Delaware defeat revives Hollinger International's £500m-plus auction of the Telegraph titles, the Chicago Sun-Times and the Jerusalem Post.

Lazards has prepared a second-round list of bidders including Express Newspapers, Daily Mail and General Trust (owner of the Daily Mail, the Mail on Sunday, the Evening Standard and This Is Money), the wealthy Berry family and private equity groups Cinven, Apax and 3i.

They are now all expecting to be given much more detailed data about the business through access to the so-called 'locked room' at Lazards.

A deadline for next bids has not been set. Stockbroker Collins Stewart fell at the first hurdle with an offer below £500m.

The Barclay brothers were considering their options today and are not barred from bidding for the Telegraph group directly.

Courtroom battles looming

WHILE the Delaware trial was the most crucial in Conrad Black's battle for survival, seven other cases are pending.

Looting charge: Black and others are being sued by shareholders for allegedly looting $300m (£163.5m) from the Hollinger group. The case in on hold pending special committee findings.

Taking on the SEC: Hollinger Inc has filed a court motion over a US Securities and Exchange Commission-obtained court protection for the special committee.

Management fee dispute: Black, Hollinger Inc and associates are being sued by Hollinger International over $200m in fees and allegedly altered records.

Fraud claim: A Louisiana teachers' pension fund is suing Hollinger International, Black and directors over an alleged multi-million-dollar fraud.

Defamation: Black is seeking C$850m (£347m) in defamation damages from Richard Breedon, the court appointed special committee monitor, and five Hollinger International directors.

Push for Barclays: Two of Black's companies, Argus and Ravelston, are seeking injunctions to stop Hollinger International blocking Black's sale to the Barclays.

Wrongful dismissal claim: Former Hollinger International executive Jack Boultbee is seeking C$16m in a wrongful dismissal lawsuit.

Party's over as reputation is ruined

Black's reputation lies in tatters today after the damning commentary by Judge Leo Strine.

The Vice Chancellor of the Court of Chancery in Delaware said Lord Black and his fellow Hollinger Inc directors may have been involved in fraud when they paid themselves more than £8m and funnelled millions more into other companies they controlled.

Strine said: 'At worst, the International board was purposely duped and there was fraud on the board. At best they were entirely uninformed.'

His words appear to strengthen the case for a host of civil lawsuits against Black and co-directors including the likes of Henry Kissinger, Richard Perle and Raymond Seitz.

It could even signal the way towards the criminal prosecution of Black who some litigants claim has looted as much as $300m (£161m) from the firms.

Black should have been at the height of his glory right now, basking in the publication of his weighty biography of Franklin D Roosevelt. Instead he and his columnist wife Barbara Amiel have put two of their luxury homes up for sale.

The two married in 1992 - his second, her third. They became the media couple with soirees at their Kensington home pulling in everyone from David Blunkett to Prince Andrew, and supermodel Elle MacPherson to actress Joan Collins.

In the end, it may have been as much Amiel's extravagant lifestyle as Black's corporate greed which has left the 59-year-old Canadian mired where he is today.