Canwest Global Communications’ newspaper and digital subsidiary opted to not pay $10 million due to bondholders last Friday, saying its Canwest Limited Partnership subsidiary deferred the payment to keep operating while it works to recapitalize.

That breach will put bondholders in a position to demand payment of the loan if creditor talks falter. Canwest LP, owes around $1.4 billion after it took the former CanWest MediaWorks LLP private in 2007.

The broadcaster last week secured $175 million in new loans as it negotiates with senior lenders and US bondholders for a wider recapitalization of its overall $4 billion debt load before July 15.

From Playback Daily