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October 8, 2009

INM bondholders formally agree to O’Reilly restructuring plan

By Gary Neale

The restructuring agreement proposed to Independent News & Media by chief executive Gavin O’Reilly last month has been formally approved by the publisher’s bondholders.

The company, which is attempting to reduce it €1.3bn debt burded, will alleviate €350m of by accepting the proposal that will lead it to swap some of its debt for equity, a rights issue and INM selling off South African ads business.

INM and its bondholders, who are owed in excess of €200m, reached an agreement in principle on the restructuring plan last month. The two parties have now signed the agreement.

An INM statement said: “The company has committed, subject to a number of conditions, to the implementation of the restructuring [agreement], including the first equity issue.

“After many months of negotiation and taking account of the financial circumstances of the company, the board believes the restructuring to be fair and reasonable, acknowledging the economic interests of all parties and providing the group with the required debt facilities.”

INM’s second largest shareholder, Denis O’Brien, has opposed the move and drawn up his own proposal to revoke the board’s authority to issue shares – a move supported by the three board members he appointed.

His plan is opposed by the rest of the board, who are calling for all shareholders to vote against it, saying it would make it hard for them to act swiftly to begin an economic recovery.

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