SYDNEY Jan 21 Nine Entertainment's creditors
have approved a $3.6 billion recapitalisation scheme that will
see U.S. hedge funds take control of one of Australia's best
known TV networks, paving the way for a possible listing in
2014, a source familiar with the situation said.
The deal, which saves Nine from sliding into receivership
and slashes its debt load, comes after long, often tortuous
negotiations and after the broadcaster last month defeated some
of its creditors who had opposed the scheme in court.
U.S. hedge funds Oaktree Capital and Apollo Global
Management will swap debt to take a 95.5 percent stake
in the company. The breakdown between the two funds has not been
Private equity firm CVC Capital Partners will
retain just 1 percent, losing nearly all of its $A1.8 billion
investment, the biggest loss on a single private-equity deal in
Mezzanine debt holders led by funds managed by Goldman Sachs
will receive 3.4 percent.
Oaktree and Apollo will have representatives on the new
nine-member board, the source told Reuters on condition of
anonymity because the agreement is confidential.
The new owners will also consider a possible relisting on
the Australian Stock Exchange in 2014. It would likely be the
biggest stock market listing in Australia since QR National, now
named Aurizon Holdings Ltd, floated in 2010, raising
"It depends on whether it makes sense at the time," the
person said. There has been a drought of initial public
offerings in recent years amid market volatility.
CVC acquired Nine for A$5.3 billion in two deals at the peak
of the buyout boom in 2006-2008, of which A$1.8 billion came
from its own pocket and the rest through cheap debt financing.
When the global financial crisis hit, advertising revenues
collapsed across the media sector, slashing profits at Nine and
rival TV networks.
The last hurdle for the recapitalisation plan is a Federal
Court hearing on Jan. 29, which is expected to approve the plan.
Spokesmen for Nine, Apollo and Oaktree did not return calls
Nine plans to take on fresh debt of A$700 million after the
restructuring, with commitments already secured for about half
the amount, according to media reports.
Ten Network Holdings Ltd has also dominated
headlines, launching in December its second capital raising in
under six months as it seeks to pay down debt and struggles to
find hit shows.