A group representing about half of the holders of Sinclair convertible notes due in May 2010 and January 2011 have tentatively reached agreement for the company to buy them back at a discount with debt not due until 2014. The notes are valued at approximately $294.3 million of the 3.0% Convertible Notes and $143.5 million of the 4.875% Convertible Notes are currently outstanding.
Sinclair is looking to pay $0.935 cents on the dollar for the 3.0% notes and $0.90 cents on the dollar for the 4.75% notes. The offer would have a number of conditions which must be met, including 95% participation by holders of the notes.
Sinclair noted that this is not yet an offer and should not be taken as such.
According to the Associated Press, this plan would ease a major credit headache, but others remain, particularly troubles with LMA partner Cunningham Broadcasting Corporation, whose problems could ricochet over to Sinclair.