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May 12, 2009 2:22 am
Independent News & Media has asked lenders for more time as it anticipates not being able to secure a debt deal by next Monday.
The Ireland-based newspaper group, publisher of The Independent in the UK, on Monday formally requested a standstill agreement – which gives a company a period of stability in which to negotiate a debt restructuring – from its banks and bondholders, as the deadline to repay €200m (£179m, $271m) in bonds looks set to lapse.
One person close to the talks said bondholders were likely to grant the standstill. The shares rose 13 per cent to 34 cents.
The bondholders, who recently hired restructuring specialists Houlihan Lokey, are expected to respond within the week.
The proposal to bondholders asks them to extend the maturity date of their debt claims, in exchange for some of the debt being repaid, and for certain assets as security for the outstanding bonds, according to people close to the matter.
Houlihan Lokey, which was appointed in the past few weeks, will need some time to review the company information and the work carried out by advisers, before the bondholders can properly consider any restructuring plan.
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