Canwest selling its stake in Score Media

Canwest Global Communications Corp. is selling its stake in Score Media Inc., the owner of The Score all-sports television channel, back to the company.

Canwest said late Tuesday it would sell its more than 16.5 million Class A shares of Score Media at a price of 40 cents a share, making the sale worth about $6.6 million.

Score Media shares closed Tuesday at 54 cents.

John Levy, Score Media's chairman and CEO said the deal reflects his company's "continued commitment to enhancing shareholder value and positions us to continue our growth in the competitive media space. We are pleased that our strong balance sheet allows us to continue to invest in the company while returning value to our shareholders."

Canwest and one of its subsidiaries, CW Media, which is a partnership with Goldman Sachs, have also hired Genuity Capital Market to sell up to nine million additional Class A shares of Score Media at 40 cents apiece in a private placement to investors.

If the sale of the shares back to Score Media and the private placement are successful, the gross proceeds are expected to be approximately $10 million with 84 per cent going to CW Media and 16 per cent going to Canwest.

Facing a $3.9 billion debt, Canwest has been struggling amidst the downturn in the television advertising market brought on by the weak economy. The company faces a Friday deadline to renegotiate its financial situation.

CW Media owns and operates 13 specialty television channels, including Showcase, Slice, History Television, HGTV Canada and Food Network Canada.