Quebecor Under Pressure

-- Graphic Arts Online, 1/7/2008 7:59:00 AM

Quebecor World, Montreal, received conditional waivers from its banking syndicate, but is under pressure to find $125-million financing by Jan. 15, and must complete a "refinancing transaction" by Jan. 31.

Its lenders have given it waivers until March 31 from compliance with certain financial tests to give it room and time to deal with its strained balance sheet.

The refinancing transaction will require the company to reduce its current credit facility to $500-million by Feb. 29. In addition, the company said it must repay the full borrowing facility and terminate its North American securitization program by June 30.

The company said it is in "active discussions" with financial institutions, but no firm commitments have been obtained so far "and there can be no assurance that such financing commitments will be obtained."

"This to me is not a good development," said Shelly Lombard a debt ratings analyst at Gimme Credit in an interview with said in an interview the Brandon Sun. "This pushes up the timetable. For me it's a very aggressive move on the part of the banks."

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