CVC seeks investor to take a Nine stake CVC Asia Pacific is searching for an investor prepared to take a large equity stake in Nine Entertainment, the debt-laden Australian media group, before a crucial test of its loans later this year. It is seeking equity investment of about A$800m (US$830m), which would allow the private equity group to launch a refinancing of Nine's A$2.7bn of senior debt, according to people familiar with the situation. CVC has held talks with Bruce Gordon, the founder of regional broadcaster WIN Corporation, Harry Sloan, the former chairman of Metro-Goldwyn-Mayer, the Hollywood film studio, as well as several financial investors. TPG, the US private equity group, is considering forming a partnership with Mr Sloan and his Nasdaq-listed investment vehicle Global Eagle Acquisitions, on a potential offer for all or some of Nine's assets. It has met the management of Nine, but has yet to decide whether it will join forces with Mr Sloan. "It's very early days," said another person with knowledge of the situation. Nine faces a possible breach of its debt covenants at the end of the June-to-September quarter, when cash put aside to top up earnings and meet leverage ratios runs out. That could deliver control of the company, which owns television station Channel 9, to the banks and hedge funds that own the senior debt. They include hedge funds Apollo Global Management and Oaktree Capital Management. CVC is also weighing up other options to repay the debt but wants any deal in place before the end of the year, regardless of whether it breaches covenants. Nine's senior debt must be repaid in February. A further A$975m of mezzanine debt owned by a Goldman Sachs fund is due the following year. CVC faces a difficult task striking any deal given the depressed state of the Australia market and falling valuations for media groups. Rivals Ten Networks Holdings and Seven West Media have both recently warned on profits and also announced capital increases to bolster their balance sheets. Nine is one of Australia's biggest media groups and has assets including Channel Nine, ACP Magazines, which publishes the Australia's Woman's Weekly, and ticketing agency Ticketek. CVC saw off competition from several private equity groups, including TPG, to purchase Nine from billionaire James Packer. It bought 50 per cent of the media group in 2006 before moving to take full control in 2008. In total, CVC paid A$5.6bn. Its A$1.9bn equity investment stands to be wiped out if the senior debt cannot be refinanced. CVC sought a deal last year to extend the maturity of the debts. It made a proposal to lenders, including Oaktree Capital and Apollo, to extend the maturity of A$2.7bn in senior debt but withdrew it in December for fear of failing to secure enough support.