Posted on 11/14/2003 2:04:55 PM PST by JohnGalt
Hollinger examines Perle investments By Stephanie Kirchgaessner Published: November 12 2003 21:57 | Last Updated: November 12 2003 21:57
Hollinger International is examining investments that were made by Richard Perle, a director on the publisher's board and prominent defense advisor, on behalf of the company.
The investigation is part of a wider internal probe at the publisher of the Daily Telegraph and Chicago Sun-Times into some of the company's corporate governance practices, including the payment of nearly $300m in management fees to Conrad Black, chief executive and chairman, and his deputies.
That probe, which is being lead by former Securities and Exchange Commission chairman Richard Breeden, is wide-ranging and involves close scrutiny of so-called "related-party transactions", or deals in which members of Hollinger's board or executives personally benefited from deals the publisher agreed with other companies.
One transaction that caught the attention of some Hollinger investors was a $2.5m investment earlier this year in Trireme Partners, a venture capital company in which Mr Perle, an independent director, is a managing partner.
Mr Perle has also played a prominent role in the late 1990's and early 2000 in directing investments in other companies through Hollinger Digital, Hollinger's investment arm.
Under review is a $14m investment the company made under Mr Perle's direction through Hillman Capital, a venture capital group controlled by Gerald Hillman - who has since become a partner at Trireme and is a member of the Defense Policy Board, as is Mr Perle.
The $14m investment contributed to a fund used by Hillman Capital to acquire - with another private equity group - more than 70 per cent of Cambridge Display Technology, a UK-based technology group that holds a patent in light-emitting polymers, in 1999.
Early investors in CDT included Lord Young, a former business adviser of Baroness Thatcher's.
Mr Perle has been criticised in the past over perceived conflicts of interest in his business dealings.
Mr Perle resigned as chairman of the Defense Policy Board earlier this year after he was criticised for having a $750,000 contract with Global Crossing, the bankrupt telecoms group. Global Crossing was at the time seeking to overcome Defense Department objections on its sale to Hutchison Whampoa, a Chinese-controlled company.
Paul Healy, head of investor relations at Hollinger, refused to comment. Mr Perle and Mr Hillman were unavailable for comment.
Guess Perle won't be suing Seymour Hersh afterall.
That doesn't make what he did right. He took Communist Chinese money - a lot of it - to influence the Defense Department and US government - while holding a position within the Defense Department. There was some talk by him of giving it to charity after this slick little deal was exposed. Wonder if he did. I also wonder if he's registered as a foreign agent, since he clearly is one.
More on Global Crossing, from http://www.nwfusion.com/news/2003/0922globacross.html. Lots of issues here still. A foreign government now owns a large piece of the US telephone system.
Global Crossing buyout gets U.S. go-ahead
By David Legard
IDG News Service, 09/22/03
The Committee for Foreign Investment in the U.S. has approved a buyout of bankrupt telecommunication company Global Crossing Holdings Ltd. by Singapore Technologies Telemedia Pte. Ltd., Global Crossing said in a statement Friday.
ST Telemedia will pay $250 million for a 61.5% stake in Global Crossing.
The deal sees a telecommunication network, which carries some U.S. military and government traffic, pass into the hands of a company majority-owned by the Singapore government. That relationship, according to local media reports, has caused concern over the deal in some areas of the U.S. government, notably the Department of Defense.
Hong Kong's Hutchison Telecommunications Ltd. was to have combined with STT in the buyout, but pulled out, apparently in anticipation that its links to mainland China would prevent the deal being approved.
The deal still needs approval from the Federal Communications Commission.
Both Global Crossing and its former subsidiary Asia Global Crossing Ltd. (AGC) have now passed into Asian hands.
AGC was taken over in March by China Netcom, which was formed in 1999 by the Chinese Academy of Sciences, the Chinese State Administration of Radio, Film and Television, the Chinese Ministry of Railways and the Shanghai Municipal Government.
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