Media group may sell HQ to pay off €1.35bn debt

IRISH Independent owners IN&M may have to sell off its Middle Abbey Street headquarters in central Dublin to pay back a portion of the €270 million of its massive €1.35 billion debt which falls due this year.

Independent News & Media’s own stockbroker Merrill Lynch said the company has five principal options to raise cash to pay down the €270m.

However, IN&M, in a statement said the company does “not have an issue” with debt repayments as 2002 earnings are expected to be “very good”.

The spokesman from Murray Consultants quoted IN&M chairman and chief executive Tony O’Reilly.

“The group’s strong brands, leading market positions and geographic diversity leaves it well positioned to deliver a meaningful improvement in earnings for 2003.”

Merrill Lynch analyst Paul Sullivan rules out a sale of the loss making Independent and Independent on Sunday titles in Britain, but does not rule out a sale of the Irish Independent’s Middle Abbey Street landmark headquarters.

The group’s main titles are no longer printed in the city centre location and a move of the editorial and administrative functions to more cost efficient locations would free the valuable site, for sale.

Mr Sullivan also notes that IN&M could sell its 50% holding in the Irish Star, IN&M has failed to sell-off its interest in cable TV operator Chorus, itself saddled with a €220m debt.

Mr Sullivan believes the most likely option will be to refinance the existing €170m preference shares through either another convertible, exchangeable or private placement to lengthen the groups debt maturity profile.

IN&M’s profit fell 25% to €21.9m in the six months through June on lower advertising revenue and a decline in profit from South Africa.`