As Canwest continues its efforts to stave off collapse and bankruptcy, the Canadian media group says they have a new deadline of 30 June, after no deal was announced by the previous deadline of June 15. Canwest said:
The holders of the new 12% senior secured notes of CMI and Canwest Television Limited Partnership as well as CIT Business Credit Canada Inc., the provider of a senior secured revolving asset-based loan facility to CMI, have agreed to extend to June 30, 2009, the date by which CMI must reach an agreement in principle with members of the Ad Hoc Committee in respect of a recapitalization transaction, as well as certain other milestones that were to be achieved by June 15, 2009.
CMI and the members of the Ad Hoc Committee have also entered into a further extension agreement and forbearance to 30 June, 2009.
June 15 was the deadline given three weeks previously. It was the 5th or 6th extension this year (there have been a couple of quasi extensions later formalised. That saw Canwest slipped $190 million in extras from a US buyout fund and the Canadian arm of a commercial finance company. That has enabled Canwest to remain operating.
The bondholders (now being paid 12% a year, upfront I hope) of this bailout package, demanded and got security over the 56% of Network Ten in Australia, meaning Canwest has no more silver to sell. Obviously there’s still some cash in the business from the bailout package and normal cashflows that allows the Asper family to continue to resist the incredible pressure on them to give up control.
But once reality breaks through into the bunker in Winnipeg, the Aspers control will be gone and quite a few people will be very upset, including big shareholder, Fairfax Financial, who may still emerge with a role It won’t be long now, unless some more bunnies are found to finance this mad attempt to avoid reality.
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