Canwest newspaper transition approved by Canadian court, stay extended

By Caroline Salls

Pittsburgh, Oct. 30 - Canwest Global Communications Corp. has received approval from the Ontario Superior Court of Justice for the transition of the business of the National Post newspaper to Canwest Publishing Inc. and the realignment of shared services between Canwest Media Inc. and Canwest LP, according to a news release.

The company said the transition was made through a newly incorporated wholly owned subsidiary of Canwest Publishing.

According to the release, the transition of the business and the realignment have also been approved by the lenders under Canwest LP's senior secured credit facilities and an informal committee of holders of Canwest Media's 8% senior subordinated notes.

Canwest said this transition and realignment are part of its structured and orderly recapitalization process designed to properly align the provision and cost allocation of some shared services between Canwest Media and Canwest LP.

Shared service agreements that govern content sharing between Canwest Media and Canwest LP and allow for consolidated and coordinated advertising sales will continue under the realignment until at least Aug. 31, 2010.

In addition, the court extended Canwest's Companies' Creditors Arrangement Act stay to Jan. 22.

The company said Canwest LP and the lenders under its senior secured credit facilities are still in discussions regarding the framework for a potential restructuring transaction.

Canwest LP's senior lender forbearance agreement runs through Nov. 9.

Canwest Global is a Winnipeg, Man.-based media company that filed for Chapter 15 bankruptcy on Oct. 6 in the U.S. Bankruptcy Court for the Southern District of New York. Its Chapter 15 case number is 09-15994.

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