CanWest MediaWorks sets up special committee for possible going private deal
Last Updated: Wednesday, February 7, 2007 | 4:20 PM ET
CBC News
CanWest MediaWorks Income Fund has set up a special committee to review a possible move by CanWest Global Communications to take the fund private, two years after the broadcaster created it in a spin-off.
"In response to recent media reports, CanWest MediaWorks Income Fund confirmed today that … it has established a special committee of independent trustees to consider any proposal from CanWest MediaWorks Inc. in respect of a possible going private or similar transaction," the company said in a release.
CanWest MediaWorks Income Fund three-month trading.
The income fund owns about a quarter of the partnership that runs Canada's biggest newspaper chain. CanWest MediaWorks Limited Partnership owns most of CanWest's newspaper holdings (except the National Post). The fund distributes income from the holdings to unitholders.
At current unit prices, the CanWest MediaWorks Income Fund is worth about $448 million. News of the potential buy-back prompted a nine per cent jump in the fund's unit price — up 68 cents to $8.34 in heavy trading.
CanWest said the announcement by Finance Minister Jim Flaherty last Oct. 31 to impose a tax on income trusts by 2011 played a role in its potential move to take its income fund private.
CanWest raised $550 million back in October 2005 when it put 26 per cent of its newspaper group into a separate, publicly-traded income fund.
Shares of CanWest Global were up five cents at $11.48 on the TSX.
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