HUNT VALLEY,MD.: Shares ofSinclair Broadcast Group held onto a 50 percent jump in the second day of trading after the company announced it had cut a deal to convert its debt. Sinclair on Thursday said it had reached an agreement with a committee representing parties holding $437.8 million in senior debt. Sinclair (NASDAQ: SBGI: and the committee agreed the media company would complete a private placement of the convertible notes, due for repurchase in May, 2010 and January 2011.
SBGI previously warned it would consider filling for Chapter 11 if it couldn’t come up with the money to pay the notes by then. The new, second-lien debt securities will mature 2014 and carry a 12 percent interest increasing one-quarter percent every six months.
Sinclair shares were trading at around $2 before the announcement was made, and shot up above $3, where they remained Monday.
-- Deborah D. McAdams
More TVB coverage of Sinclair:
August 5, 2009:“Sinclair Reports Time Sales Dip in 2Q”
Sinclair Broadcast Group said today that time sales fell $1 million between the first and second quarters, a reversal of the typical trend.
August 3, 2009: “Sinclair’s LMA Partner Gets Extension”
Cunningham Broadcasting, a management partner of Sinclair Broadcast Group, received an extension on its $33.5 million loan due July 31. The company now has until Oct. 30, providing it makes $200,000 principal payments on each of its term loans on the first business day of August, September and October.
July 14, 2009: “Analyst Deems Sinclair Bankruptcy ‘Remote’” “To be blunt, we think management is posturing,” Wachovia’s Marci Ryvicker said. “We believe that management is painting the most dire scenario in a public forum as part of its negotiations with convert holders. There are still 10 months before these converts can be put to the company.”
July 14, 2009: “Sinclair Positions for Bankruptcy“
Sinclair Broadcasting group may have to file for bankruptcy if it can’t renegotiate the terms of some of its debt. In a filing with the Securities and Exchange Commission dated July 10, the company said it had $488.5 million due over the next 18 months.
June 19, 2009: “Standard & Poor’s Cuts Sinclair“
“We believe that sluggish TV advertising in a nonelection, recession year will cause Sinclair’s EBITDA to decline further and leverage to continue to rise,” wrote Deborah Kinzer, an S&P credit analyst. “The negative rating outlook reflects our concerns about the company's deteriorating credit metrics and its ability to refinance potential upcoming puts.”
