ITV flatters bondholders
ITV’s bondholders have won improved terms on the broadcaster’s proposed bond exchange just two days before the offer closes.
The struggling broadcaster said that, following discussions with “several substantial holders” of its 2011 bonds, the new bonds will pay a coupon of 10 per cent rather than the 9 per cent offered previously.
The exchange offers bondholders about 70 per cent of new bonds maturing in 2014, and about 30 per cent cash.
The exchange may cut debt by up to €150m (£127.2m), ITV has said.
The exchange offer will delay ITV’s first large refinancing demand, allowing it more time to turn around its business. The company owed £730m at the end of 2008.
“This sends a fairly challenging signal to the market,” said Mark Chapman, an analyst at CreditSights.
“Since the exchange offer was first announced, market sentiment has weakened slightly and so investors may have backed away from the deal a little.”
ITV has been struggling with an industry-wide slump in advertising revenues, hitting its share price and sending its debt into junk-rated territory.