Vancouver's largest publicly traded media company has taken steps to shore up its financial position in the face of a global pandemic.
Today, Glacier Media's related company, GVIC Communications Corp., announced that it sold a 45 percent interest in two businesses to Madison Venture Corporation.
In return for turning over its stake in Environmental Risk Information Services and Specialty Technical Publishers, GVIC received $11 million in cash and will retain 100 percent of the two businesses' cash flow for two years.
According to Glacier Media, this deal will "alleviate the financial distress caused by the impact of the COVID pandemic on the Company’s revenues and cash flow, and to allow the Company to maintain access to its banking facility and have sufficient liquidity".
"Glacier’s consolidated revenues (including its proportionate share in the Company's joint ventures) declined approximately 36% in April and May."
According to its website, Glacier Media owns 65 publications across five provinces. That includes community papers across the western section of Metro Vancouver, as well as Business in Vancouver.
Glacier stated that it acted quickly to implement "significant operating cost reductions, including wage rollbacks, reduced work weeks, temporary layoffs and a variety of other cost reduction measures".
It's also receiving government assistance, including the federal wage subsidy.
"Due to the financial impact of the pandemic, the Company requested and received temporary covenant relief and worked with its banking syndicate to implement the financial restructuring and capital raising plan in order to reach agreement on the bank facility amendment terms in a timely basis," Glacier stated. "As a result of the transaction, the banking facility has been amended, concurrently, to provide additional ongoing borrowing capacity."
Under the agreement, Madison can buy more GVIC units in a buy-sell provision that can be exercised for three years following the agreement.
Madison owns 42 percent of Glacier Media.
"Given Madison's relationship with GVIC and Glacier and its familiarity with the Businesses, Madison was able to move quickly and was motivated to support GVIC," Glacier Media stated.