LONDON, May 13 (Reuters) - Dutch TV production company Endemol, the owner of the ‘Big Brother’ TV franchise, will meet its lenders next Wednesday in London as it prepares for a 2.2 billion-euro ($3.14 billion) debt restructuring, sources close to the matter said on Friday.
The company, which also produces other television shows including ‘Deal or No Deal’, will update lenders on its performance and future strategy.
Findings of an independent business review may also be presented at the meeting, said the sources.
Endemol declined to comment.
Endemol will struggle to meet its banking covenants this year on loans which were put in place in 2008 to back the company’s 2.639 billion euro leveraged buyout.
The broadcaster is owned by Italian Prime Minister Silvio Berlusconi’s Mediaset (MS.MI), Endemol’s founder John de Mol’s investment vehicle Cyrte Group and Goldman Sachs’s Capital Partners.
While the company passed its first quarter loan covenants, a breach is expected later in the year, possibly at the end of the second quarter, the sources said. [ID:nLDE68N0H6]
Endemol has not held a lender meeting since its leveraged loans were syndicated in 2008 to banks including Barclays Capital, Goldman Sachs and the now bankrupt Lehman Brothers, the sources said.
Some banks and institutional investors lending to Endemol expect the company to offer a restructuring proposal at Wednesday’s meeting, but one of the sources said this may not happen yet.
The company’s shareholders, which also own a portion of the loans following a debt buyback in 2010, have been talking to a number of key banks in recent months about a debt for equity swap, which would involve reducing the company’s loans, the sources added. ($1=.6998 euros) (Reporting by Isabell Witt; Editing by Greg Mahlich)