pbl recaps media interests forming pbl media

Sydney - Wednesday - October 18: (RWE Aust Business News) -
Publishing and Broadcasting Ltd (ASX:PBL) has entered into binding
agreements to implement a recapitalisation of certain of its media
interests, including ACP Magazines, Nine Network (including its interest
in Sky News), its 50pc interest in ninemsn and its 41pc shareholding in
carsales.com.au.
These media businesses are being transferred to a new company,
PBL Media, in which PBL and CVC Asia Pacific will each hold a 50pc
economic interest.
PBL will receive net cash proceeds of $4.542 billion.
To fund the payment to PBL, PBL Media has underwritten financing
from UBS for new debt of $3.75 billion non-recourse to PBL and CVC.
Additionally, CVC will invest $982 million to acquire convertible
notes in PBL Media.
Once the new media laws become effective and subject to FIRB
approval at that time, CVC's convertible notes will convert to 50pc of
the ordinary shares in PBL Media.
Until that time, PBL will continue to control the Nine Network.
It will also continue to control Ninemsn in its joint venture
with Microsoft.
John Alexander will act as executive chairman of PBL Media, and
will continue as chief executive of PBL.
Ian Law will be chief executive of PBL Media and Pat
O'Sullivan will be chief financial officer.
The transaction is conditional upon any regulatory or other
approvals that may be required by PBL.
Completion is expected to occur in early 2007.
"Over the last 12 months we've strongly indicated our desire to
invest in new opportunities," executive chairman James Packer said.
"The restructure will provide the capital and flexibility
necessary for the company to achieve its ambition to expand its
international gaming interests.
"A clear benefit of the restructure will be the quarantining of
the gaming and media businesses, with the latter's use of non-recourse
debt protecting PBL shareholders from additional capital risk incurred in
the funding of any expansion through acquisition.
"For PBL it releases cash at a time when there is a land-grab
underway for gaming and entertainment assets around the world."
PBL shares were in a trading halt and last traded at $19.85.