Sun-Times may see delay in getting funds from Canada investments
The company, which was known as Hollinger International until last year and owns the Chicago Sun-Times and smaller Chicago-area newspapers, said it has $95 million invested in Canadian asset-backed commercial paper trusts.
Companies use commercial paper to borrow money for short periods.
Sun-Times has $36 million invested with CIBC-sponsored trusts, which it expects to redeem on maturity. The primary concern is with $59 million invested with third-party sponsored trusts. Of this amount, $48 million invested in trusts sponsored by Ironstone Trust and Planet Trust did not redeem on maturity last week.
The remaining $11 million with Lafayette Structured Trust matures Tuesday, but Sun-Times said it has not received direct confirmation its investment will be redeemed at that time.
Sun-Times has $25 million deposited with CIBC from maturities redeemed last week and $65 million in short-term U.S. investments. The company expects those funds to be available at any time.
Sun-Times said there is no guarantee it will fully recover the principal from its Canadian investments, but views the risk as one of timing instead of capital loss. It does not expect the possible delay in fund recovery to impact its liquidity or operations.
''The company will continue to monitor closely the Canadian asset-backed commercial paper market and evaluate our options with the trusts in which our cash is invested,'' it said in a statement.
Sun-Times said it plans to transfer most of the Canadian cash to the U.S. when it becomes available for transfer.
Shares of Sun-Times Media Group fell 5 cents to $2.94 in morning trading.
