It is understood the plan would involve O'Reilly halving his near-30% stake in the company to stave off further action from the company's lenders and put it on a more stable financial footing.
The proposal has been accepted by the company's lending banks and a deal is understood to be just days away, which would extend the timetable for repayment of its €1.3bn loans.
It would mean a major restructure of the company's shareholding, with bondholders, who are owed €200m, receiving cash and shares equating to the value of about half the company.
A rights issue would follow the issuing of new shares to help raise more money.
O'Reilly is thought to be firmly behind the proposal but the group's second biggest shareholder, Denis O'Brien, is trying to block the proposal.
IN&M declined to comment.