Sale of bond boosts ITV

TROUBLED broadcaster ITV yesterday completed a &pound;135m convertible bond offer, designed to bolster its balance sheet, and announced plans to plug a gaping hole in its pension fund.<br /><br />The Coronation Street broadcaster, which is struggling to appoint a chairman and chief executive, said it plans to use the proceeds to extend its average debt maturity and diversify the firm&rsquo;s funding.<br /><br />ITV also said it has scrapped plans for the sale of digital terrestrial channel operator SDN, saying it now planned to use the asset to provide backing for its pension fund deficit, which ballooned to &pound;538m at the end of June from &pound;138m at the end of 2008.<br /><br />&ldquo;Such a partnership would reduce the pension deficit on a funding basis, with ITV continuing to consolidate SDN&rsquo;s revenues and cashflows,&rdquo; the company said, adding that the unit continued to trade in line with expectations. Full year revenues are expected to exceed &pound;40m.<br /><br />Analysts welcomed the news, with Goldman Sachs estimating that SDN&rsquo;s 2009 revenues will exceed &pound;40m.<br /><br />&ldquo;This should be taken as a positive,&rdquo; the broker said. &ldquo;The company is extending debt maturity with minimal impact on profit and loss net interest.&rdquo;<br /><br />'ITV repeated that it had no plans for a rights issue, adding that the decline in UK television advertising revenue had continued to ease during the second half of 2009.<br /><br />The bond, which is due in 2016, carried a coupon of four per cent with a conversion price of 70.44p per share, a 40 per cent premium over the average price of ITV shares across yesterday&rsquo;s trading.<br /><br /><strong>GILLIAN SHELDON<br />CREDIT SUISSE<br /></strong>Credit Suisse and UBS acted as joint bookrunners and lead managers on ITV&rsquo;s bond offer. The Credit Suisse team was led by Gillian Sheldon, managing director of Credit Suisse First Boston and co-head of European media and telecoms group within the corporate and investment banking division.<br /><br />Sheldon is responsible for relationships with clients in the media and leisure industries, with particular emphasis on the television, radio, publishing and cable sectors. Major media clients include Capital Radio, BSkyB, Reuters, Telewest, Gala Group and Pearson.<br /><br />A popular figure within the industry, she was part of a formidable duo with Anthony Fry &ndash; first at Rothschild, and then at BZW &ndash; which advised on a raft of major deals during the dotcom boom, including the Telewest/Flextech merger.<br /><br />However, these days she prefers to keep a low-profile, with industry insiders saying that &ldquo;for a senior woman in the City, she prefers to keep her head down&rdquo;.<br />