Shares fall over Mirror hack claims

24 Oct 2012, 10:21 am   -   Source: AAP
Shares in the UK publisher of the Daily Mirror have plunged over fresh phone hacking claims. (AAP)

Shares in the UK publisher of the Daily Mirror have plunged over fresh phone hacking claims. (AAP)

Shares in the UK publisher of the Daily Mirror have plunged nearly 10 per cent after claims of phone hacking against its newspapers were revealed.

The publisher of the Daily Mirror and The People has seen its shares fall nearly 10 per cent after it emerged that claims of alleged phone hacking had been lodged against its newspapers.

Media lawyer Mark Lewis is dealing with phone-hacking claims for four high-profile individuals in the first action to be launched against newspapers outside Rupert Murdoch's News International.

Former England football manager Sven-Goran Eriksson has filed a complaint alleging hacking at the Daily Mirror at a time when Piers Morgan was editor. Mr Morgan has repeatedly denied any involvement in the practice.

The three other claimants are Coronation Street actress Shobna Gulati, Abbie Gibson, a former nanny for the Beckham family, and Garry Flitcroft, the former captain of Blackburn Rovers football team, and they involve the Sunday Mirror and The People.

Parent company Trinity Mirror, which saw around STG17 million ($A26.54 million) wiped from its market value after the allegations emerged, said it had "not yet received any claims nor have we been provided with any substantiation for those claims".

It added: "As we have previously stated, all our journalists work within the criminal law and the Press Complaints Commission Code of Conduct."

The claims allege "breach of confidence and misuse of private information" relating to the "interception and/or misuse of mobile phone voicemail messages and/or the interception of telephone accounts". No further details have been filed.

The claims come weeks before Lord Justice Leveson is due to unveil his proposals for the UK press amid speculation that he is set to recommend statutory regulation.

The allegations come at a challenging time for Trinity Mirror, which is in the midst of a cost-cutting drive and recently unveiled a management reshuffle that will see its national and regional divisions fall under one structure.

In its most recent update, new chief executive Simon Fox said revenues fell four per cent in the 26 weeks to July 1 as its regional papers were hit by the economic malaise in northern cities and advertising slumped 10 per cent.

There are signs the group had turned a corner as national advertising sales performed strongly and profits increased when the cost-cutting measures kicked in.

Johnathan Barrett, an analyst at N+1 Singer, said: "The shares have been very strong and buoyed by an improved nationals advertising market and the likelihood of greater cost savings in 2013.

"The claims will weigh on the shares, in part because many had assumed the subject was fading away as an issue."

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