Canwest Global subsidiary misses $10M in debt payments
Last Updated: Friday, May 29, 2009 | 5:25 PM ET
CBC News
Cash-strapped Canwest Global Communications Corp. said a subsidiary that owns 12 major daily newspapers and other publications has decided not to make about $10 million in debt payments that were due Friday.
Canwest 3-month TSX chart Canwest said the payment deferral by Canwest Limited Partnership is intended to allow it to continue normal operations while it tries to work out a broader financial restructuring.
In addition to the 12 dailies, the subsidiary operates 26 community newspapers and more than 80 online publications. It does not own the National Post.
The Winnipeg-based media company, which also owns the Global television network and other broadcast operations in several countries, has been negotiating for months with an array of lenders.
Canwest said Friday's missed payments constitute an event of default which would allow its lenders to demand immediate payment of all the money owed under the credit facility. It did not say how much money is involved.
However, the company said it's continuing negotiations with its main lenders and holders of its 9.25 per cent senior subordinated notes over a recapitalization deal.
On May 20, Canwest announced that another subsidiary, Canwest Media Inc., had secured $175 million in financing to enable it to keep operating.
At that time, it said it did not expect its main lenders or holders of another set of notes to demand immediate repayment while negotiations were going on.
Shares of Canwest lost five cents to close at 21 cents Friday on the TSX.
