It is understood the group has formally requested from its banks and the bondholders a standstill agreement – which would give it more time in which to negotiate a debt restructuring deal with bondholders.
The bondholders are expected to respond later this week, but the signs point towards granting INM’s request.
Just a fortnight ago, the INM board said it was confident of reaching a satisfactory agreement from its ongoing negotiations with the bondholders. While Denis O’Brien – INM’s second largest individual shareholder behind Tony O’Reilly – had rated the chance of a successful outcome for the group as 50-50, INM chief financial officer Donal Buggy said: “There will be a deal. The directors are confident an agreement will be reached which is acceptable to the group.”
It is thought INM’s proposal to bondholders is for them to extend the maturity date of their debt claims in exchange for some of the debt being repaid and for certain assets as security for the outstanding bonds.
INM has already said the faltering global credit markets meant it was unable to raise the necessary funds to pay off the bond and lower its €1.4bn debt.
The chance of selling its 39.2% stake in Australian media group APN, which would have gone some way to raising the much-needed funds, failed for those same reasons.
Meanwhile, it has transpired that the Broadcasting Commission of Ireland (BCI) is to investigate the extent of Denis O’Brien’s media ownership in Ireland, in the aftermath of him gaining board representation at INM, where he holds a 25% stake. Mr O’Brien’s Communicorp group already owns a number of national radio stations, including Today FM and Newstalk, as well as local stations.