Johnston Press given extension over debt talks

JOHNSTON Press, owner of The Scotsman, yesterday confirmed it had been given two months breathing space to renegotiate its debt.

The Edinburgh-based company is renegotiating £448 million in debt with a consortium of banks.

Some of the terms of its loans were due to expire today, but yesterday Johnston Press said the lenders had agreed to defer testing the debt covenants until 31 August, as negotiations continue.

Chief financial officer Stewart Paterson explained that the announcement to the market was a formal requirement under Stock Exchange rules. Its timing, so close to the planned expiry, did not mean negotiations were stalling.

Paterson said the talks were "constructive and progressive" and that the Johnston Press board hoped to have an agreement to present to the City by the time the company publishes its interim results on 26 August.

He added: "The big thing is that we're experiencing a severe cyclical downturn. There are some structural changes, but by far the largest impact we currently see is the cycle. We have to work hard to ensure the business is in the right shape for when the market returns."

Shares in Johnston Press closed unchanged at 16.5p.