(Updates with shares reaction in third paragraph.)
Dec. 27 (Bloomberg) -- Promotora de Informaciones SA, the publisher of El Pais newspaper, agreed with lenders to refinance about 2.9 billion euros ($3.8 billion), winning time to prepare for a sale of assets.
A syndicated loan will become a so-called bullet loan with its maturity extended until March 2014, Madrid-based Prisa, as the company is known, said today. That maturity could be further extended until Dec. 19, 2014 if certain conditions are met, including the sale of a bond, it said.
The shares climbed as much as 4.4 percent in Madrid. Prisa said in June it may sell non-strategic assets valued at more than 500 million euros and issue non-banking debt instruments. Media companies in Spain are struggling to halt a slide in earnings and market value as advertising revenue slumps with the country mired in its worst economic crisis in decades.
“This is a very important step for Prisa as it wins some time to sell assets at a better price and improve its profitability,” said Peter Braendle a fund manager at Swisscanto Asset Management in Zurich, which oversees $60 billion, including Prisa shares.
Prisa added as much as 4 cents and traded 1.1 percent higher at 93 cents as of 12:19 p.m. The stock has fallen 39 percent this year, cutting the company’s market value to 794 million euros.
A bridge loan and bilateral credits will be extended until Sept. 19, 2015 under certain conditions and a subordinated loan extended until Sept. 20 2015 under the same conditions, Prisa said today. Along with the refinancing process, Prisa shareholders will convert warrants, valued at 150 million euros, into shares of the company, it said.
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