LONDON/BENGALURU (Reuters) - Johnston Press (JPR.L) shareholder Crystal Amber Fund Ltd CRS.L can help management avoid a poor debt restructuring deal, the hedge fund’s chief executive officer told Reuters.
“We have a good track record of assisting companies,” Richard Bernstein told Reuters on Tuesday, ahead of London-listed activist manager Crystal Amber disclosing it had raised its stake in Johnston Press to 6.74 percent from 5.42 percent.
The rise in shareholding came after a 11.5 percent slide in the stock on Sept. 14.
“Our experience is that good management teams welcome our involvement. We hope that management at Johnston Press will allow us to help,” he said.
More than 93 percent has been wiped off the value of Johnston Press shares since a debt restructuring deal was approved in May 2014 at a general meeting. bit.ly/2d9fnmr
The company began a 360 million pound capital refinancing plan in 2014 through the issue of new shares, bonds and a 25-million-pound credit facility. bit.ly/2cV2tqY
Chief Executive Ashley Highfield received a 1.65 million pound pay package in 2014 after overseeing the restructuring, with 483,000 pounds awarded as a bonus, the annual report showed. His salary fell 65 percent to 581,000 pounds in 2015.
“Sadly, it appears that the only winners last time around were the team of advisers who got paid a shocking 19 million pounds,” Bernstein told Reuters.
“Based on the outcome in 2014, we lack the visibility of how the result will be any different this time around. The omens are not good.”
Johnston Press declined to comment. The company’s debt stands at 137.7 million pounds, as on Aug. 4, according to the company’s interim results report.
Johnston Press, which reported a 27 percent fall in first-half adjusted pretax profit is trying to realign its operations to grow its digital business amidst falling circulation.
The newspaper publisher sold its Isle of Man Tindle Newspapers Ltd for 4.25 million pounds in July, as the company looks to cut debt after its i newspaper acquisition.
Crystal Amber first disclosed a 3.29 percent stake in Johnston Press on Feb. 3, although Crystal Amber has held a small position in Johnston Press since before 2014.
Reporting by Maiya Keidan, Additional reporting by Sanjeeban Sarkar and Pranav Kiran; Editing by Sunil Nair