MediaWorks repays ‘Joyce loan’ for radio spectrum licences
(BusinessDesk) MediaWorks' subsidiary RadioWorks has repaid the $32.28 million outstanding on a "loan" signed off by former Communications Minister Steven Joyce that allowed the media group to defer payments to the Crown for radio spectrum licences.
The balance of $32.28 million of principal plus interest was paid yesterday, almost two years ahead of schedule, current minister Amy Adams says.
MediaWorks had originally owed $43.3 million plus GST and had previously made two payments of $11.9 million. The Crown charged the private equity-owned company interest of 11.2%.
Ms Adams says eight broadcasters had chosen to take up a Crown offer of a deferred payment scheme in 2010 for their 20-year spectrum licences.
"The deferred payment scheme was intended to help take the financial pressure off a number of broadcasters during what was a difficult economic period. The scheme has clearly worked well and achieved its objectives."
RadioWorks holds 218 individual licences and was due to complete its payments by October 2014. Early payment was an option offered as part of the arrangements and RadioWorks has exercised that option, in line with the contract provisions.
MediaWorks is owned by Ironbridge Capital. The broadcaster, whose stable includes TV3 and Four, and radio stations including the Rock, MoreFM, said in August it had written down the value of goodwill by $241.6 million in a capital restructure that included US private equity investor Oaktree Capital Management holding a chunk of its debt.
The group's holding company, GR Media Holdings, posted a loss of $305.6 million in the year ended August 31, 2011, compared to a loss of $50.5 million a year earlier.