Canwest repayment put off until May

Another reprieve has been granted from senior lenders and U.S. bondholders as Canwest works to restructure its $4.1-billion debt load.

Canwest Global Communications on Wednesday said it has secured another reprieve from its senior lenders and U.S. bondholders as it works to restructure its $4.1-billion debt load.

Canwest Global said its subsidiary Canwest Media received another extension from senior lenders on its $300-million credit facility to May 5.

The embattled broadcaster also has another two-week extension from an ad hoc committee of 8% U.S. noteholders. They agreed not to demand repayment of overdue interest on US$761 million in principal until May 5.

Canwest Global is holding separate, parallel talks with its creditors, who now call the shots after the broadcaster breached key debt covenants. The company has so far been unable to raise sufficient cash through non-core asset sales or new financing to satisfy its lenders.

The debt talks are complicated by the Canadian senior lenders standing first in line to receive interest repayments, even though the U.S. bondholders can now demand repayment of their US$761-million principal and US$30.4 million in overdue interest and interest charges.

During the next two weeks, Canwest Media’s senior lenders will supply ‘additional access to credit’ to ensure Canwest Global can stay in business, the broadcaster said in a statement.

The broadcaster has also opened separate debt talks for another division, Canwest Limited Partnership, with senior lenders.

From Playback Daily.