UPDATE 1-Quebecor World receives C$400 mln rescue proposal

(Adds details, background; in U.S. dollars unless noted)

By Wojtek Dabrowski

TORONTO, Jan 11 (Reuters) - Quebecor Inc (QBRa.TO)(QBRb.TO) and a private-equity fund managed by Brookfield Asset Management (BAMa.TO) have submitted a C$400 million ($392 million) refinancing proposal in a bid to rescue troubled commercial printer Quebecor World Inc (IQW.TO).

Quebecor and Tricap Partners, the Brookfield fund, said late on Friday that if the deal is accepted by Quebecor World, they will immediately make available C$200 million to the printer to make sure it has enough liquidity until the closing date of the rescue financing, expected at the end of March.

Tricap and Quebecor, which has 35.5 percent of Quebecor World's equity and controls 84.5 percent of its votes, are equal investors in the refinancing, they said.

The refinancing must be approved by Quebecor World's lenders, as well as the sponsors of its North American securitization program and other involved parties.

Tricap and Quebecor did not lay out specifics of what they would receive in return for lending to Quebecor World. However, they said they believe the deal is in the best interests of all the company's stakeholders, given its liquidity and balance-sheet problems "within the current North American credit crisis."

Quebecor World also said late on Friday it acknowledges the offer and that its management has determined "the submitted proposal is meaningful and serious in light of the circumstances and the company's current financial situation."

The Montreal-based firm has been seen by analysts and investors as teetering on the edge of insolvency after its lenders imposed a set of deadlines by which it must refinance its strained balance sheet.

The banks told Quebecor World late last month it must raise $125 million in new financing by next Tuesday. As well, the company has until the end of June to repay its credit facility and end the securitization program. The facility and program are estimated to be worth a total of about $1 billion.

Earlier in the day, Quebecor World shares fell 30 Canadian cents to 92 Canadian cents on the Toronto Stock Exchange. They are worth a small fraction of their value from last February, when they hit a year high of C$17.25.

With tight debt markets and its weak share price, Quebecor World may not have many options left to meet the banks' demands, analysts have said, adding an outright sale of the company could be the only route.

($1=$1.02 Canadian) (Reporting by Wojtek Dabrowski; editing by Rob Wilson)