“It is evident that there is common ground and everyone is broadly agreed on where we need to get to. There is a still a lot of work to get through.
“This is a business which we have long believed needed to transform, but once done, could return to growth”
Johnston Press could seek to persuade trustees to accept equity in a new financial structure, for instance, to provide reassurance pensions will be paid. Such a deal could require the approval of the pensions regulator.
The US hedge fund GoldenTree is Johnston Press’s biggest lender, holding bonds with a face value of around £70m. It has the whip hand in talk with shareholders, who face wipeout if the company defaults on its debts. Johnston Press’s total market capitalisation is only £11m.
GoldenTree has a record of buying up distressed debt to engineer mergers, including in the newspaper industry. Such a deal with a rival could form part of Johnston Press’s restructuring, although senior sources at other local newspaper publishers questioned whether they might be able to pick up titles such as the Sheffield Star and the Scotsman cheaper in an administration.
As Mr Highfield attempts to convince trustees to join in restructuring, Johnston Press continues to be battered by the digital forces that have hit local newspapers over the last decade. In the first half, newspaper sales were down 11.5pc on last year, excluding the boost from the takeover of the i national title last April.