Hollinger bondholders grant covenant reprieve

The move lifts the newspaper group from technical default, allowing it to raise debt

Holders of $78 million of high-yield bonds in newspaper giant Hollinger Inc. have agreed to loosen the covenants on their notes to remove the company from technical default and allow it to raise another $15 million. The deal requires Hollinger to pay its bondholders a lump sum of $2.73 million.

Hollinger quickly made use of the additional financial flexibility by placing $15 million of 11.875% notes due 2011 with institutional investors. The company says that it intends to use the proceeds from