Yellow Media says court suspends debt payments ahead of hearing

Wed Sep 19, 2012 6:31pm EDT
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(Reuters) - Canada's Yellow Media Inc YLO.TO said the Quebec Supreme Court suspended all its debt-related obligations starting from September 30, as it readies to consider the company's recapitalization plan next month.

Following the order, the company said it will not pay C$25 million in principal repayment due on October 1.

In July, Yellow Media revealed plans to cut its C$1.8 billion debt by more than half and revamp its board as it struggles to move its telephone directory business to an online model.

The company's stock is valued at C$31.2 million ($31.97 million).

Earlier this month, the Toronto Stock Exchange approved the recapitalization plan after debtholders and shareholders voted in favor.

Shares of Montreal, Quebec-based Yellow Media closed at 6.5 Canadian cents on Wednesday on the Toronto Stock Exchange.

($1 = 0.9760 Canadian dollars)

(Reporting by Thyagaraju Adinarayan in Bangalore; Editing by Sreejiraj Eluvangal)