Brazil Media Company Globo
Announces Debt Restructuring
DOW JONES NEWSWIRES, October 29, 2002
SAO PAULO, Brazil -- Brazilian media company Globo said Monday its main financing vehicle, Globopar SA, and some related units will "restructure the payment flows of their financial obligations."
The company didn't specify which loans or bonds would be affected by the move.
U.S. investment bank Goldman Sachs Group has been hired to find investors for the restructuring process, about which Globo said it hopes to disclose more information in 90 days.
Globopar's President Ronnie Moreira said that despite "the efforts of the company and its shareholders to administer Globopar's debt with significant capital support," the deterioration of Brazil's economy "made it necessary to re-evaluate the chronology of Globopar's debt payments."
Globopar said it has already begun discussions about the process with some of its creditors. Globopar and its related units had $1.2 billion in debt as of March 31.
Despite recent downgrades of the company's credit ratings, analysts have said Globo has been too timid about cutting costs and bloated production budgets for its television programs.
While acknowledging its cable-TV venture, Net Servicos e Comunicacoes SA, hasn't met expectations, Globopar said the restructuring wouldn't affect partners of its main editorial arm, broadcaster TV Globo.