views

INM is close to brink, warns major investor

Independent News and Media (INM) could go into the Irish equivalent of Chapter 11 bankruptcy protection, the group&rsquo;s second largest shareholder said at the weekend. <br /><br />Denis O&rsquo;Brien, who owns a 26 percent stake, said: &ldquo;We&rsquo;ll have to consider it. I am being very clear.&rdquo; <br /><br />But O&rsquo;Brien said the costs of examinership would be prohibitive for the Irish company, which has a debt pile of around &euro;1.4bn (&pound;1.21bn). &ldquo;I think that for the scale of the business, it just can't afford it,&rdquo; he said.<br /><br />The media group has been in a long battle over its ailing financial situation and on Friday was forced to roll over a standstill deal with bondholders on a&nbsp; &euro;200m senior bond until 27 August, the third extension in as many months.<br /><br />O&rsquo;Brien has said publicly that he would lend his support if the group was to launch a rights issue, but only if there was a plan in place which would ensure a return to value. Another option is to negotiate a debt for equity swap with lenders.<br /><br />O&rsquo;Brien has been vocal about the company&rsquo;s need to dispose of loss-making assets, including the Independent paper. INM recently made &euro;37m from selling a stake in an online gambling business Cashcade.