Canwest gets extension on debt payment
Two-week reprieve to avoid possible bankruptcy protectionTORONTO -- Canadian broadcaster Canwest Global Communications Corp. has received another two-week extension to crunch talks with creditors to avoid possible bankruptcy protection.
Canwest Global on Wednesday said it has now until May 19 to renegotiate growing debt obligations with senior lenders and U.S. bondholders.
The latest extension came as Canwest Global faced a Tuesday night deadline to make an overdue $30.4 million payment to 8% U.S. bondholders.
The broadcaster said bankers for subsidiary Canwest Media late Tuesday also agreed to extend the waiver of certain borrowing covenants on a $300 million credit line for another two weeks.
And a consortium that represents 72% of U.S. bondholders also said it will not demand repayment of a $761 million principal until May 19 after the broadcaster missed an interest payment initially due on March 15.
A continuing failure to meet its current debt obligations could eventually force Canwest Global to file for bankruptcy protection as it attempts to fend off the effects of deep advertising downturn on its newspaper and TV assets.
Success in its current creditor talks, meanwhile, could enable Canwest Global to recapitalize the company and restructure its balance sheet.