UPDATE 2-UTV Media ousts chairman for ties with top shareholder

Thu Feb 23, 2012 3:39pm GMT

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* UTV says John McGuckian's ties with TVC comprised independence

* Appoints Helen Kirkpatrick interim chairman

* Shares jump 13 percent (Adds comments from TVC, analyst, background)

By Jochelle Mendonca and Brenton Cordeiro

Feb 23 (Reuters) - Northern Irish broadcaster UTV Media said its board voted to remove John McGuckian as chairman of the company, due to his close association with its largest shareholder TVC Holdings, an Ireland-based investment firm.

Shares of the company shot up about 13 percent to 135.25 pence by 1530 GMT on Thursday on the London Stock Exchange. The stock has risen 30 percent so far this year.

UTV Media, which owns the popular soccer show TalkSport, said a majority of its board members considered that McGuckian's close association with TVC compromised his independence to a great extent leading to the vote.

"The chairman was not acting independently of TVC. There was a concern that preferential treatment was being shown to one shareholder specifically and this has prompted today's action," a UTV spokesman said.

Following the ouster, McGuckian, who has been on UTV's board since 1970, Shane Reihill and Kevin Lagan also resigned from the board, UTV Media said in a statement.

Reihill is the executive chairman of TVC Holdings and McGuckian is a non-executive director on its board.

"There may be some corporate activity involving these individuals and their investment vehicle and the company," Peel Hunt analyst Patrick Yau told Reuters.

"There is clearly something going on behind the scenes which we are not seeing at the moment," Yau said.

TVC Holdings has an 18 percent stake in UTV Media, according to Thomson Reuters data.

TVC said in a separate statement that a majority of the non-executive directors opposed the removal of McGuckian.

"The actions taken by the executive directors and a minority of non-executive directors to have the chairman removed from his position without following due process were contrary to the UK Corporate Governance Code," TVC said.

UTV Media said Helen Kirkpatrick, another non-executive director, had agreed to become its interim chairman. (Reporting by Jochelle Mendonca and Brenton Cordeiro in Bangalore; Editing by Gopakumar Warrier)

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