Independent News & Media agrees a 332m debt reduction rescue strategy

David Hellier
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INDEPENDENT News &amp; Media, the highly-indebted media group, yesterday announced that it had agreed with its bond-holders and banks a restructuring plan that will reduce its debts by &pound;332m.<br /><br />The plan, which still faces several hurdles before it can be implemented, involves the stakes held by Sir Anthony O&rsquo;Reilly and rival Denis O&rsquo;Brien being almost halved.<br /><br />One source close to the situation said he expected O&rsquo;Brien, who last week proposed a &pound;90m equity injection, to come back with a rival offer on terms that would be more attractive for the bond-holders and shareholders. O&rsquo;Brien&rsquo;s current proposal was roundly rejected by the media group&rsquo;s board.<br /><br />&ldquo;Denis will formulate a strategy and may come back with a revised proposal,&rdquo; the source said.<br /><br />Sources close to the Independent camp said that the group&rsquo;s proposal was considerably better for bond-holders and shareholders than the O&rsquo;Brien alternative. &ldquo;He will have to come back with something special,&rdquo; one source said.<br /><br />Under the Independent board&rsquo;s plan the group intends to exchange the &pound;100m plus of outstanding bonds for new shares representing 46 per cent of the issued share capital. There will also be a rights issue to raise not in excess of &pound;86m.<br /><br />North Sea Partners and Davy stockbrokers are advising on the deal.