Shares in Australian media firm APN News and Media plunged Tuesday after a walkout from board members over a capital raising dispute with major shareholder Ireland's Independent News and Media.
APN, owner of several Australian radio stations, billboard advertising assets, regional newspapers and some of New Zealand's top titles, said its chairman, CEO and three directors had resigned over a financial impasse.
"While the board agreed the company needed to reduce its debt, it was unable to agree on the methodology," APN said in a statement to the Australian Securities Exchange (ASX) after the close of trading on Monday.
"Independent News and Media and its major shareholder, together with (fund manager) Allan Gray -- representing approximately 51 percent of APN's shares -- have unequivocally indicated they are opposed to a capital raising at the present time."
Australian-listed shares in the media group slumped more than 13 percent at the open Tuesday. They were down 11.11 percent in neighbouring New Zealand.
The departures had been expected, with Irish tycoon Tony O'Reilly's INM requesting the removal of six directors, including the chairman and CEO, in favour of establishing a new board. A sixth board member is to retire as planned in April.
APN had intended to launch an Aus$150 million (US$155 million) rights issue in conjunction with its full-year earnings results later this week.
Those who resigned, including chairman Peter Hunt and CEO Brett Chenoweth, had advocated this approach as consistent with "a continued focus on repositioning the publishing business and potential asset sales."
The remaining board members believed that "consideration of an equity raising should be undertaken in a time frame that allowed other options to be pursued," APN said.
"The departing directors have a different view on gearing levels to the major shareholders, and in light of their opposing position it is not tenable for them to continue."
APN intends to announce its full-year results on Thursday as planned and has begun the process of recruiting replacements to the board.
O'Reilly failed in a 2007 takeover bid for APN after shareholders rejected his Aus$3 billion offer.
APN publishes 20 daily and more than 100 other newspapers across Australia and New Zealand, including the leading New Zealand Herald national broadsheet. It owns three of New Zealand's top five radio stations.