Independent New and Media has this morning confirmed that it has conditionally agreed to sell its interest in its South African outdoor advertising business, INM Outdoor, for â‚¬98m (£86.2m).
The troubled publisher of the Independent and Independent on Sunday said it expected the transaction to be completed in the last three months of this year when a pan-African private equity investor group led by Helios Investment Partners will take ownership.
The deal, which was widely tipped to be going ahead in recent weeks, is subject to the approval of the INM shareholders and the South African Competition Authority.
In addition, in accordance with the terms of a prevailing standstill agreement entered into by INM with its senior banks and an ad hoc committee of bondholders, their approval to the transaction is also required.
The company confirmed late yesterday that it had agreed a fourth standstill agreement with its lenders over repayment of a â‚¬200m (£175m) bond, originally due in May, as it sought to put together a financial restructuring deal. It now has until 25 September to work out a deal.
It has been looking to reduce its debts through reducing staff numbers and selling off parts of the business. Itraised â‚¬22m by selling part of its stake in newspaper publisher Jagran Prakashan earlier this year. It also sold its 18 per cent holding in online gaming firm Cashcade.
INM said: “The proceeds of the disposal of INMO will be an important part in delivery of the company’s stated strategy to substantially reduce its debt.”
Confirmation of the sale comes just after the company reported that group’s net debt stood at â‚¬1.3bn at the end of June and that it had a pre-tax loss of â‚¬48.5m in the first six months of the year.
The business was also forced to reduce the value of its titles as advertising revenue continued to fall.