New debt deadlines loom for struggling Canwest

(In U.S. dollars unless noted)

By Wojtek Dabrowski

TORONTO, April 6 (Reuters) - Canwest Global Communications Corp CGS.TO, Canada's largest media company, faces yet another deadline for a deal with its banks that would let the company stay in business while it works to shore up its finances.

Canwest, which owns the Global television network and a stable of daily newspapers, including the National Post, has until Tuesday to cut a deal with its senior lenders.

It also has until April 14 to make a $30.4 million interest payment on its 8 percent senior subordinated notes. It has already once missed the payment, which was due March 15.

If Winnipeg, Manitoba-based Canwest fails to pay the interest by April 14, the noteholders can demand the repayment of about $761 million in principal.

Such a scenario could spell serious trouble for Canwest, which has a debtload of about C$3.7 billion ($2.98 billion).

Canwest said if negotiation with its lenders and noteholders are successful, they will extend its access to credit and let it pursue a recapitalization transaction.

Analysts have said that it is possible the company may file for bankruptcy protection as the weak economy wreaks havoc on advertising revenues at its television stations and newspapers.

Canwest is trying to slash its operating and capital costs and is looking at divesting non-core assets. It is considering selling five conventional TV stations and agreed to sell its stake in sports broadcaster Score Media.

It has also sold The New Republic magazine in the United States to a group of private investors, including the magazine's editor-in-chief.

However, no large-scale asset sale that would make a significant dent in Canwest's debtload has materialized.

Canadian financial services giant Fairfax Financial Holdings (FFH.TO) owns about 22.4 percent of Canwest's subordinate voting shares and analysts have speculated it could step up with some sort of refinancing proposal.

A big part of Canwest's debt dates back to its 2000 acquisition of a stable of Canadian newspapers from Hollinger International for about C$3.2 billion.

The deal made Canwest the country's biggest publisher of daily newspapers. It included 13 big-city dailies as well as 126 community newspapers, Internet assets and a 50 percent stake in the National Post, a national newspaper. The company later bought full control of the Post.

In 2007, Canwest expanded its television holdings by partnering with an affiliate of U.S. investment bank Goldman Sachs (GS.N) to buy specialty TV group Alliance Atlantis Communications for C$2.3 billion.

Canwest is controlled by the Asper family of Winnipeg. Aside from its Canadian newspaper and TV assets, it has television holdings in Australia through its stake in Network Ten.

Canwest shares were up 0.5 Canadian cents at 31 Canadian cents on the Toronto Stock Exchange on Monday. About a year ago, they were trading at C$4.95 each.

($1=$1.24 Canadian) (Reporting by Wojtek Dabrowski; editing by Rob Wilson)