Canwest, which owns 56.6% shares of Network TEN, has lined up $175 million ($198 AUD) in financing, interpreted by analysts as “an interim step.”
Struggling under $4 billion in debt, the company indicated that some of its current debtholders have agreed to provide an additional $100 million.
In return, they would receive new senior notes with a face value of $105 million paying a hefty annual interest rate of 12 per cent. That would translate into a yield of 12.6 per cent on the $100 million they actually provide to Canwest.
In addition, CIT Business Credit Canada Inc. will provide a $75-million senior secured revolving asset-based loan facility.
Canwest Media has agreed to, by June 15, reach an agreement in principle with members of the ad hoc committee of its 8 per cent senior noteholders regarding a recapitalisation transaction.