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Independent lives to fight another day
The owner of the Independent newspaper has agreed a deal with bondholders, which will give it more time to pay its debts
Independent News & Media has reached an agreement with its creditors, allowing it a fourth extension on the repayment of a €200m bond due in May, according to the Guardian. The current agreement, which expires on Thursday, will be afforded an extension of one more month, giving the company more time to re-negotiate its debt package.
Although the extension will be a welcome relief, as the repayment is pushed further back other interest payments are falling due. September will see €50m of the company's bank debt coming up for repayment, exacerbating its problems further.
It is thought that various sales by the group have realised enough cash to pay the bank borrowings, but it will not help the overall situation. Bondholders are pushing for a debt for equity swap, agreeing to their debt being wiped out in exchange for the 55.5 per cent of equity owned by chief executive Gavin O'Reilly's family and billionaire Denis O'Brien.
The board will meet this Thursday to discuss the issues, ahead of its half-year earnings announcement on Friday. It is believed that the weak advertising environment will have contributed to poor figures and they are unlikely to help the company's shares recover meaningfully from their 80 per cent decline over the past year. With funds becoming tight and possible disposals fewer there continues to be feverish speculation over the closure of the Independent itself. ·
