I think a dramatic change could soon appear in the newspaper industry in Australia with Fairfax.
Here is an interesting article in the Australian titled Fairfax has some trouble with the fair facts
For those who have not been following the story, Fairfax owes about 2.5 billion dollars. It has debt covenants with the banks and these are close to the limit.
The market is clearly worried. Fairfax's share price was $4.80 at the start of last year, last month it was $1.32 that is a 72% drop. Now it is 93 cents. A 30% drop in a month. Two days ago, it went into a trading hold.
Now they are looking here to make a special issue at 75c a share, a discount to market of 20 percent on what is already a cheap price to try and raise 684 million dollars.
What is troubling to the newsagency industry much of the problems are blamed on the newspaper side of the Fairfax! That is why I am concerned.
