Chatham Asset Management, LLC

October 06, 2016 08:00 ET

Chatham Asset Management, LLC Acquisition of New Variable Voting Shares of Postmedia Network Canada Corp.

TORONTO, ONTARIO--(Marketwired - Oct. 6, 2016) - Chatham Asset Management, LLC ("Chatham") announced today that Chatham Asset High Yield Master Fund, Ltd., Chatham Fund, LP and other funds managed by Chatham (collectively the "Funds") acquired on October 5, 2016 an aggregate of 61,166,689 Class NC variable voting shares ("Variable Voting Shares") of Postmedia Network Canada Corp. (the "Issuer"), which represents approximately 65% ownership of the outstanding Variable Voting Shares and approximately 32% of the voting rights attached to all outstanding voting shares of Postmedia. The Variable Voting Shares were acquired pursuant to a plan of arrangement and recapitalization transaction of the Issuer (the "Recapitalization"), by which all of the 12.50% senior secured notes due July 2018 (the "Second Lien Notes") issued by Postmedia Network Inc., a wholly owned subsidiary of the Issuer, in the aggregate principal amount of approximately US$268.6 million, together with all interest accrued from and after July 15, 2016, were exchanged for new Variable Voting Shares of the Issuer. Prior to the closing of the Recapitalization, the Funds did not own any equity securities of the Issuer. The Funds exchanged US$178,909,000 (C$235,766,280) principal amount (plus accrued interest) of Second Lien Notes in consideration of the issuance of the Variable Voting Shares acquired by the Funds. Following the closing of the Recapitalization, the Funds hold in aggregate 61,166,689 Variable Voting Shares, representing approximately 65% of the outstanding Variable Voting Shares and approximately 65% of the aggregate outstanding Variable Voting Shares and Class C voting shares ("Voting Shares") of the Issuer. The Variable Voting Shares are convertible by Canadians into Voting Shares on a one-for-one basis. The Funds may not convert the Variable Voting Shares into Voting Shares as only Canadians are permitted to hold Voting Shares.

The Variable Voting Shares were acquired for investment purposes. Chatham intends to review its investment in the Issuer on a continuing basis. Depending on various factors including, without limitation, the Issuer's financial position and investment strategy, the price levels of the Variable Voting Shares, conditions in the securities markets and general economic and industry conditions, Chatham may in the future take such actions with respect to its investment in the Issuer as it deems appropriate including, without limitation, purchasing additional Variable Voting Shares, selling some or all of the Funds' Variable Voting Shares, engaging in short selling of or any hedging or similar transaction with respect to the Variable Voting Shares or changing its intention with respect to any and all matters referred to in this paragraph.

The issuance of this press release is not an admission that any entity named in this press release owns or controls any described securities or is a joint actor with another named entity.

The Issuer's head office address is 365 Bloor Street East, 12th Floor, Toronto, Ontario, M4W 3L4.

A copy of the early warning report in respect of the transaction described above is available on SEDAR at For additional information, or for a copy of the early warning report, please contact:

James Ruggerio

Chatham Asset Management, LLC

26 Main Street, Suite 204

Chatham, New Jersey 07928


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