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Canwest raises $175M in new financing

Canwest Global said some of its current subordinated noteholders have agreed to buy $100 million of senior secured notes in two subsidiaries, Canwest Media Inc. and Canwest Television Limited Partnership.
CBC News ·

Cash-strapped Canwest Global Communications Corp. said Wednesday it has arranged up to $175 million in new financing.

The company said some of its current subordinated noteholders have agreed to buy $100 million of senior secured notes, with a face value of $105 million, in two Canwest Global subsidiaries, Canwest Media Inc. and Canwest Television Limited Partnership.

Meanwhile, CIT Business Credit Canada Inc. has agreed to provide a $75-million asset-backed loan to Canwest Media.

Canwest's current noteholders have also agreed to forebearance — a postponement on repayment of their debt — until June 15.

"These facilities are intended to provide Canwest with sufficient credit availability to operate its business in the ordinary course as it continues its work to effect a recapitalization transaction," the company said in a release.

Canwest plans to use the funds from the new cash to pay off a current senior line of credit.

Canwest Media now has until June 15 to reach an agreement-in-principle with its noteholders on a recapitalization, and until July 15 to come up with a definitive agreement.

Canwest owed $30.4 million in interest payments on $761 million in outstanding notes, but the company missed that payment back in March, and then got a series of extensions leading up to Wednesday's announcement.

Canwest has a total debt load of about $4 billion.

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