2 Min Read
VANCOUVER, British Columbia (Reuters) - Bank of Nova Scotia has questioned the authority of the chief executive of Canwest Global Communications Corp, exposing a rift between the debt-laden media company and its long-time bank, the Globe and Mail newspaper said on Monday.
The bank, which is owed millions by Canwest, is leading an attempted purchase of the group's newspaper division. The unit received court-approved creditor protection last week as Canwest struggles under a debt load of about C$4 billion ($3.9 billion).
Canwest Chief Executive Leonard Asper has tried to halt the sale of the newspapers, which include the company's flagship National Post, saying the move is rushed and a better price could be realized down the road, the Globe said.
Asper raised his objections in a letter to Scotiabank, Canada's third biggest bank, which then responded.
"The information provided to us makes it unclear whether you have the corporate authority to make the proposals contained in your letter," Jane Rowe, Scotiabank's executive vice-president of global risk management, told Asper in her letter.
Canwest said on Friday it has received an offer of about C$925 million for its newspapers from a group of lenders representing Canada's five biggest banks and led by Scotiabank.
Canwest is seven months behind on its debt payments and Scotiabank has warned the company it has no say over whether the newspaper assets are sold to recoup the money senior lenders are owed, the Globe said.
Canwest, Canada's biggest media company, has hired an investment bank to hunt for superior offers for the unit, which also includes papers like the Montreal Gazette and Vancouver Sun.
Reporting by Nicole Mordant; editing by Rob Wilson