Canada's largest media company files for bankruptcy protection as it struggles with a £2.4bn debtStory from the Guardian
Canada's largest media company, Canwest Global Communications, has filed for bankruptcy protection as it struggles to unearth itself from a C$4bn (£2.4bn) mountain of debt.
The sprawling Winnipeg-based empire owns a range of broadcasting and print businesses, including the National Post newspaper, a conservative-leaning daily founded in 1998 by the disgraced media mogul Conrad Black.
Canwest's chief executive, Leonard Asper, said business would carry on as usual despite the legal process: "We are firmly committed to moving quickly to restructure the company and emerge from creditor protection financially stronger and more competitive."
Canwest's bankruptcy filing in an Ontario court this morning covered the National Post and television channels including Global Television, MovieTime and DejaView. But other parts of the company were left out, including papers such as the Montreal Gazette and the Calgary Herald, plus a joint venture with BBC Worldwide to run BBC Canada.
Established by the late media mogul Israel 'Izzy' Asper, the Canwest group can trace its origins back to a single Winnipeg television station in the 1970s. The company expanded in broadcasting through the 1990s before paying $3.2bn for a chain of newspapers owned by Conrad Black's Hollinger empire in 2000 – a deal widely viewed as key to Canwest's present difficulties because it loaded the company with debt.
In a memo to the company's 1,700 employees, Canwest's chief executive acknowledged that the filing was likely to create "some personal anxiety". But he offered reassurance on jobs: "Let me say quickly that this process is not going to lead to significant job losses."
Canwest has a tentative agreement with its creditors on a financial restructuring of the business. The deal would essentially hand control to lenders, leaving existing shareholders with ownership of just 2.3%. Leonard Asper, who is Izzy Asper's son, said he hoped the refinancing could be completed within four to six months.
Burdened by its level of borrowing, Canwest has struggled to keep up repayments on its obligations as the global recession has bitten a chunk out of advertising revenue. After interest payments and write-downs in the value of assets, the company made a C$1.58bn loss for the nine months to May.
The firm has been selling assets to raise money. It recently offloaded its E! television stations, the American magazine New Republic and a majority stake in Australia's Ten Network.
The National Post still publishes a regular column by Conrad Black, who is serving a sentence for fraud in a US prison in Florida. The paper is the second of Black's former titles to slip into bankruptcy, following in the footsteps of the Chicago Sun-Times.
The sprawling Winnipeg-based empire owns a range of broadcasting and print businesses, including the National Post newspaper, a conservative-leaning daily founded in 1998 by the disgraced media mogul Conrad Black.
Canwest's chief executive, Leonard Asper, said business would carry on as usual despite the legal process: "We are firmly committed to moving quickly to restructure the company and emerge from creditor protection financially stronger and more competitive."
Canwest's bankruptcy filing in an Ontario court this morning covered the National Post and television channels including Global Television, MovieTime and DejaView. But other parts of the company were left out, including papers such as the Montreal Gazette and the Calgary Herald, plus a joint venture with BBC Worldwide to run BBC Canada.
Established by the late media mogul Israel 'Izzy' Asper, the Canwest group can trace its origins back to a single Winnipeg television station in the 1970s. The company expanded in broadcasting through the 1990s before paying $3.2bn for a chain of newspapers owned by Conrad Black's Hollinger empire in 2000 – a deal widely viewed as key to Canwest's present difficulties because it loaded the company with debt.In a memo to the company's 1,700 employees, Canwest's chief executive acknowledged that the filing was likely to create "some personal anxiety". But he offered reassurance on jobs: "Let me say quickly that this process is not going to lead to significant job losses."
Canwest has a tentative agreement with its creditors on a financial restructuring of the business. The deal would essentially hand control to lenders, leaving existing shareholders with ownership of just 2.3%. Leonard Asper, who is Izzy Asper's son, said he hoped the refinancing could be completed within four to six months.
Burdened by its level of borrowing, Canwest has struggled to keep up repayments on its obligations as the global recession has bitten a chunk out of advertising revenue. After interest payments and write-downs in the value of assets, the company made a C$1.58bn loss for the nine months to May.
The firm has been selling assets to raise money. It recently offloaded its E! television stations, the American magazine New Republic and a majority stake in Australia's Ten Network.
The National Post still publishes a regular column by Conrad Black, who is serving a sentence for fraud in a US prison in Florida. The paper is the second of Black's former titles to slip into bankruptcy, following in the footsteps of the Chicago Sun-Times.
No comments:
Post a Comment