Congratulations, you’re an unsecured Canwest creditor

FTI Consulting, one of the groups of lawyers handling Canwest Limited Partnership’s creditor protection filing, has a section on its website devoted to the proceedings. There you can find, among other things, a list of creditors (PDF).

They include, of interest to Montrealers and Gazette followers (in alphabetical order):

  • $253,808.16 to 1001 Dominion Square Management Inc., The Gazette’s landlord
  • $12,726.14 to Agence France-Presse, a newswire
  • $406,505.42 to Amex for corporate credit cards
  • $6,556.34 to the Audit Bureau of Circulations
  • $47,497.80 to Bleu Blanc Rouge, which handles The Gazette’s marketing campaigns
  • $5,213.38 to Bloomberg, another newswire
  • $114,700.77 to the Calgary Flames
  • $74,763.18 to Canada Post
  • $44,237.47 to Canadian Press (even though Canwest no longer uses CP) – listed separately as Canadian Press and The Canadian Press
  • $5,179.91 to CNW for press releases
  • $38,892.90 to Garda for security services
  • $24,035.10 to Getty Images
  • $1 million exactly to GWL Realty Advisors of Edmonton, the largest single non-bank creditor
  • $24,419.64 to Henry’s photo shop
  • $44,100.00 to Ipsos Reid for surveys
  • $21,380.91 to La Presse
  • $22,575.00 to Kleintel, a Montreal-based phone survey company
  • $28,041.92 to Legacy.com, a partner for paid obituaries online
  • $10,450.00 to Loblaws
  • $12,167.94 to the Los Angeles Times – Washington Post, another news service
  • $16,558.62 to Messageries Dynamiques, a Quebecor-owned distribution company
  • $52,783.50 to Microsoft Canada
  • $145,026.49 to the Ministère du revenu du Québec
  • $8,475.66 to the National Newspaper Awards
  • $17,931.06 to Nestle Canada
  • $5,065.31 to New York Times Digital
  • $9,946.29 to the Ontario Press Council
  • $50,400.00 to Orsyp Logiciels, a Montreal-based job schedule software company
  • $90,000.00 to the Régie des alcools, des courses et des jeux
  • $72,930.38 to Rexall Sports Corporation, which owns the Edmonton Oilers
  • $37,153.20 to Rogers Media
  • $34,755.00 to Rogers Publishing
  • $11,841.84 to Saxotech Integrated Mediaware, which is providing a new desktop publishing system for Canwest papers
  • $331,160.57 to Service-Now.com, which … well, it’s anyone’s guess what they actually do.
  • $70,987.96 to Sun Media
  • $15,813.11 to Montreal’s Teleze Inc., a telemarketing company selling Gazette subscriptions
  • $87,499.65 to the Globe and Mail
  • $8,065.02 to New York Times Syndication, yet another news wire
  • $54,485.00 to the Salvation Army in Saskatoon
  • $145,341.3 to Toronto Star Syndication Services and Torstar Syndication Services
  • $10,773.90 to (Chicago) Tribune Media Services
  • $27,151.49 to United Way in Edmonton
  • $6,124.99 to the Winnipeg Free Press
  • $112,481.44 to the Workers’ Compensation Board of British Columbia
  • $15,491.17 to World Entertainment News Network for celebrity gossip
  • $45,986.85 to three radio stations
  • $45,437.84 to four union locals

The list is very long, but two items stand out like a sore thumb because of the extra digits, and those are the ones that really matter in all this:

  • $78,382,191.78 to the syndicate of banks under the senior subordinate credit agreement
  • $449,411,375.34 to senior subordinated notes

That’s (some of) the money Canwest LP owes the banks, and the reason it’s in financial trouble.

What the list doesn’t include, though, are freelancers, those independent contractors who provide stories and photos to newspapers in exchange for a negotiated fee. Most freelancers who did work between mid December and the Jan. 8 filing (and some who did work much earlier than that but weren’t paid or didn’t cash their cheques before the filing) are now grouped in with the paper suppliers, wire services, distributors and anyone else who provides goods and services to the newspapers and websites.

I counted two freelance columnists in The Gazette on the list through their companies:

  • $5,418.00 to L. Ian MacDonald’s Lian Public Affairs Ltd.
  • $9,673.79 to Phil Reimer’s Phil Reimer Communications. He’s Canwest’s travel cruise columnist

Other freelancers, including fine dining columnist Lesley Chesterman, are also out thousands of dollars as a result of this filing. Smaller freelancers (which may include myself, I’m still not sure yet) are out mere hundreds of dollars.

Whether they’ll see any of that money owed depends on how much money is left to give to all the other creditors, and that will depend mostly on the sale price of Canwest LP. The banks have set a floor bid of $950 million, the amount they’re owed for their loans (which means they wouldn’t be paying for the chain but rather exchanging their debt for equity and ownership), but they’re hoping someone will put in a higher bid. The higher the sale price, the more money can go to creditors. But there’s little hope that the price will be high enough to pay 100 cents on the dollar.

That’s very disappointing. The banks won’t fold if they’re out a few hundred million. The wire services aren’t a few thousand dollars from bankruptcy. But some freelancers rely on it as their only source of income, and a few hundred dollars can be the difference between making a rent payment and having an angry landlord.

After Canwest LP filed for creditor protection (not to be confused with bankruptcy, which eliminates debt), it secured so-called debtor-in-posession financing, which allowed it to continue its business. This means that people who did freelance work after Jan. 8 will still get paid (along with other post-filing creditors), as publisher Alan Allnutt explained. That also puts many in a strange position of getting screwed out of payment but still continuing to do business with a company.

If only I understood business, it would all make sense to me.

8 thoughts on “Congratulations, you’re an unsecured Canwest creditor

  1. Dominique

    It’s not true that it’s only the freelancers who did work between mid-December and January 8th who are not being paid. The period that was unpaid is far longer for many of us. I did work way back in October that was never paid, and I doubt L. Ian MacDonald did over $5000 of work, and Phil Reimer $9000 in a span of six weeks. Why don’t you double-check with Gazette management, or the people at Canwest who seem to have been sitting on invoices until creditor protection was filed? I still do not have a satisfactory answer as to why an invoice submitted October 13th was still not paid by January 8th. Something’s fishy. And I’m not the only one who thinks so.

    Reply
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  3. Dominique

    How come you don’t know if you’re going to get paid or not? Either your invoice is frozen or it’s not — or do you get preferential treatment as a former employee?

    Reply
    1. Fagstein Post author

      When I wrote the post, I hadn’t gotten any information that any of my invoices had been frozen, and I was still an employee. I’ve since been told that part of one of my invoices has been frozen for articles between Dec. 31 (the date of my last invoice) and Jan. 8 (the date of the creditor protection filing). In total, I’m out $450 for two pieces, which is far less than most people are owed.

      Reply
  4. Ian

    I read with great interest your blog about CanWest’s creditor protection status. I have been calling it bankruptcy protection to my friends when I complain about the dough the owe me. I satnd corrected but they still owe me money for pieces I did that fell into that blck hole of a time period prior to Jan.8. Yes, I still do freelance stuff for The Gaz and get cheques pronto as before all the shit went down. But one cheque I had hanging around since early Dec of 2009, I did not deposit until later in Jan. and CanWest put a stop payment on it and the bank charged me for it. I was majorly miffed. But subsequent calls to editors and Gaz payroll, has led me to believe, like you, Fagstein, that I ought not to hold my breath while waiting to get the money they owe me. Which as you mention for a freelancer ain’t mega-bucks, but still helps in the meagre bank account department. That cheque I left hanging around? Apparently I am not the only one to have done that. Geezus, why wasn’t I thinking I should deposit this right away because CanWest may go into creditor protection any day now?

    And CanWest owes $54 grand to the Saskatoon Salvation Army. I’m surprised they haven’t incurred the wrath of God over that one.

    Reply
  5. Mike

    I did some work for the Gazette for 5 days between Nov.23 – 27, 2009. I got a cheque from them on Dec.12 for $280. I cashed it about a week later. Approximately a month later on Jan.18 2010 my bank took the $280 from my account. I asked them what was going on and they said there’s been a stop payment issued on the cheque by Canwest. I contacted the guy who’d hired me at the Gazette and he said “oh yeah, sorry about that. Contact FTI”. I’ve tried that and all I get is a run-around, being passed from one person who doesn’t know anything to another who doesn’t know anything. They keep telling me to check their website every week for “futher information”. Has anyone checked FTI’s website? You’ve got to be a lawyer to understand the jibberish posted there and I’m NOT a lawyer. I saw an article in the business section of the Gazette a few days ago (Mar.24 or 25) that said that some kind of action had taken place to do with Canwest and “unsecured creditors” had until Apr.16 to file a claim. I just went back to their website ( http://cfcanada.fticonsulting.com/cmi/ ) but didn’t see anything about that. So, does anyone out there know what I/we need to do to file a claim ?

    Reply
    1. Fagstein Post author

      Try The Gazette again. They recently got permission to start paying outstanding freelance invoices, and cheques have already started going out.

      Reply
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