CanWest MediaWorks Income Fund Completes $550M IPO

On October 13, 2005, CanWest MediaWorks Income Fund (the Fund) completed its $550 million initial public offering of 55 million units. On completion of the Fund's IPO, CanWest MediaWorks Inc. (CanWest) transferred its Canadian newspaper and online media businesses, with the exception of the National Post, to CanWest MediaWorks Limited Partnership (the Partnership) in exchange for units and indebtedness of the Partnership. Substantially all of the indebtedness was repaid by the Partnership using $517 million of the net proceeds of the Fund's IPO, together with $850 million advanced under a new $1 billion five-year senior unsecured credit facility in favour of the Partnership. As a consequence, the Fund holds a 26 per cent equity interest in the Partnership, with CanWest holding the remaining 74 per cent.

The Fund's IPO was underwritten by a syndicate of underwriters led by Scotia Capital Inc. and RBC Capital Markets.

The Partnership is the largest publisher of newspapers in Canada, as measured by paid circulation, readership and revenue. CanWest retains ownership of the National Post, its Canadian broadcasting and related operations and its international media businesses.

Concurrently with the completion of the Fund's IPO, CanWest entered into a new $500 million five-year senior secured revolving credit facility. This credit facility and the credit facility in favour of the Partnership were provided by a syndicate of lenders arranged by the Bank of Nova Scotia.

CanWest also successfully completed tender offers and consent solicitations for substantially all of its 10 5/8 per cent senior subordinated notes due 2011 and 7 5/8 per cent senior unsecured notes due 2013. The total amount paid by CanWest for the notes was approximately US$750 million. Citigroup Corporate and Investment Banking acted as dealer manager for the tender offers and consent solicitations.

CanWest used proceeds from its new credit facility, together with the net proceeds it indirectly received from the Fund's IPO, to fund the tender offers and consent solicitations for the notes and to repay approximately $500 million of debt outstanding under CanWest's previously existing senior credit facilities. CanWest also reduced its swap position resulting from the retirement of various of its debt obligations, thereby reducing its exposure to currency fluctuations between the Canadian and US dollars.

CanWest was represented in-house by Richard Leipsic, vice-president and general counsel, and Riva Richard, director, legal affairs, and Nancy Zettler and Debbie Schween, legal counsel. CanWest was assisted by Osler, Hoskin & Harcourt LLP with a team that included Linda Robinson, Doug Marshall, Mary Abbott, Desmond Lee, David Pathe, Andrew Moshoian and Robert Hughes (corporate), Jack Silverson and Kim Wharram (tax), Richard Pratt, Michael Matheson, Deborah Reine, Mark Rasile, Joyce Bernasek, Keith Lau and Danna Donald (financial services). US advice with respect to the tender offers and consent solicitations was provided by Cleary Gottlieb Steen & Hamilton LLP with a team that included David Lopez, Mark Adams, David Parish, Benjamin Faulkner and Saam Azar.

The underwriters were represented by Stikeman Elliott LLP with a team that included Simon Romano, Maurice Swan, Ian Putnam and Jeffrey Elliott (corporate) and John Lorito (tax).

The Bank of Nova Scotia was represented by Borden Ladner Gervais LLP with a team led by Joanne Foot and Bruce Fowler (financial services) that included Howard Silverman, James Mathers, Gus Karantzoulis, Terence Lui, Shane Pearlman and Will Wallace (financial services), Paul McCarten (real estate), Craig Webster (tax) and Ziad Katul (IP).