Canwest Global Media said in a statement on its website early today that it had arranged up to $C175 million in new financing. “These facilities are intended to provide Canwest with sufficient credit availability to operate its business in the ordinary course as it continues its work to effect a recapitalization transaction,” the company said in the release. The company said some of its current subordinated noteholders have agreed to buy $C100 million of senior secured notes in two Canwest Global subsidiaries, Canwest Media Inc. and Canwest Television Limited Partnership, while, CIT Business Credit Canada Inc. has agreed to provide a $C75-million credit line to Canwest Media.

Canwest’s current noteholders have also agreed to the postponement on repayment of their debt until June 15. Canwest plans to use the funds from the new cash to pay off a current senior line of credit of $C112 million and to finance its purchases of programs in the upfronts and screenings in New York and Los Angeles this week and weekend. Paying off the loan from the banks gets them out of the way and leaves Canwest free to talk to the holders of more than $C700 million of notes.

The US TV Networks, CBS, NBC, Fox, CBS and production houses like Warner hold previews of their so-called Fall line ups in New York and get advertising revenue commitments from US buying groups and advertisers; they then hold screenings in los Angeles (starting later today) for overseas production contract holders, such as Canwest, plus the Seven, Nine and Ten Networks for Australia.

Canwest now has until June 15 to reach an agreement-in-principle with its noteholders on a recapitalisation, and until July 15 to come up with a definitive agreement. The $C175-million of new money gives Canwest a few months of operating funds while it negotiates a final deal with its banks, bondholders and potential new investors.

“These facilities are intended to provide CanWest with sufficient credit availability to operate its business in the ordinary course as it continues its work to effect a recapitalization transaction,” CanWest said in a press release.

The money should provide about a quarter of operating capital to finance the company’s newspaper and TV businesses. It’s clear that without the cash, it couldn’t have made program purchases this week. But as usual the new cash has come at a terrible cost: Canwest is paying 12% for the $100-million it is getting from existing bond holders, that’s 50% more than 8% interest rate on the outstanding loans and recognition of the fraught state Canwest remains in, hovering on the edge of bankruptcy.