By: Mark Fitzgerald
The group of lenders buying the newspapers of bankrupt Canwest Limited Partnership are putting up more equity to reduce the debt the company will carry when the deal closes next week.
Under the new plan , the group led by National Post President and CEO Paul Godfrey will make an equity commitment of C$250 million. The original plan called for its to issue C$150 million in mezzanine notes and C$100 million in shares. The effect will be to reduce debt after the papers emerge from creditor protection to C$700 million from $850 million. (C$1 = US97 cents)
The deal for Canwest’s newspapers – including the Montreal Gazette, Ottawa Citizen and Vancouver Sund — will still be valued at $1.1 billion, including $950 million, which will pay off the bank lenders who have claims of $925 million.