Conrad Black offers to redeem bonds

Feb. 18, 2004 at 9:55 AM
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TORONTO, Feb. 18 (UPI) -- Conrad Black, locked in a fierce battle for U.S.-based Hollinger International, is apparently facing an acute cash flow problem.

Black, who runs a holding company that has as its sole asset a major stake in and the majority voting rights of Chicago's Hollinger International, wants to redeem $120 million in bonds issued by the holding company.

That's because Black owes holders of the 11.9 percent bonds nearly $7 million in interest payments by the end of March and does not -- apparently -- have the money, the Financial Times reported Wednesday.

Failure to make the interest payments means his voting rights in Hollinger pass to the bond holders.

The risk of default increased recently after Hollinger's board warned it would suspend management payments to the group after uncovering allegedly unauthorized management payments and non-compete fees.

As a result, Black has gotten what amounts to a line of credit from the company, Press Holdings International, to which he wants to sell his Hollinger stake.

That line of credit would be used to redeem the high-interest bonds.

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