INM to secure third standstill deal
Independent News & Media is set to secure a further extension to a financial standstill deal with its investors in order to bide more time for debt restructuring.
The month-long extension is the third agreement that the Independent owner has had to negotiate in the last three months.
INM confirmed its first standstill agreement with banks and investors in May with the hope of negotiating a refinancing deal of a €200 million bond (see INM agrees “financial standstill” deal with investors).
The first agreement expired on June 26 and the second runs up until this Friday.
Earlier this month, INM was forced to sell a percentage of its stake in Jagran Prakashan, an Indian publishing group, for €22 million (£19 million) (see INM cuts stake in Indian media company).
The Irish group plans to use the cash to pay off the €15 million working capital facility that INM secured from its banks after it agreed the first standstill deal.
INM reported a full-year pre-tax loss of €161.4 million for 2008 compared with a €284.8 million profit for 2007 (see INM reports €161.4m loss).
The company said its 2008 losses were mainly due to a €373.1 million exceptional charge – €290.9 million of which related to INM’s decision to write down the value of its newspaper assets amid the economic downturn.
There has been much speculation in recent months that INM will announce the sale of its UK Indy titles in a bid to alleviate its financial situation.
In the latest ABC release, the Independent was down 2% period on period and suffered a large year on year decline of around 14%, leaving its total circulation at around 200,000 copies (see ABC National Newspaper Round-Up: June 2009).
The Independent on Sunday continued to struggle as well and suffered the highest percentage decline in the overall Sunday market, after losing almost 5,000 copies, a 3% period on period downturn, to 162,000 copies in total.
The Sunday quality title also witnessed a significant year on year drop of 22.5%, a real term loss of more than 47,000 copies.