Spain's El Pais publisher refinances huge debt

27th December 2011, Comments 0 comments

Spain's top media group Prisa, publisher of the El Pais daily, said Tuesday it had reached an agreement with creditors to refinance its 3.2-billion-euro ($4.2 billion) debt.

"The agreement with 35 banks implies support for the process of transforming the company and underlines confidence in its future," the group said in a statement.

The deal is to be ratified in the coming days, it said.

Prisa's debts grew when it borrowed money to launch a takeover of cable television company Sogecable and then took out a series of other loans, with the debt peaking at more than five billion euros.

Total debts stood at 3.236 billion euros as of September 30, 2011.

Under the agreement, Prisa must repay a syndicated loan, a bridge loan and a subordinated loan as well as other bilateral credits before a series of deadlines, the latest of which is September 20, 2015.

Prisa merged last year with investment group Liberty Acquisitions Holdings, founded by Briton Martin Franklin and US-German Nicolas Berggruen, which injected about 650 million euros into the firm.

Under the refinancing agreement, Franklin and Berggruen will inject yet more capital, subscribing to 150 million euros in new shares, at two euros a share, the group said.

Prisa announced in October its 2011 third-quarter net profits plunged 77.7 percent from a year earlier to 6.83 million euros.

In January this year, it announced 2,500 job losses worldwide, equal to 18 percent of its total staff spread across Spain, Portugal and Latin America.

© 2011 AFP

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