Quebecor Fails - Update

The banks have stepped in after the Quebecor was placed in receivership early Monday. The Globe and Mail says it best:

A rescue financing backed by parent Quebecor, run by Mr. Peladeau, and restructuring fund Tricap Partners was just too cute by a half for banks that had, until August, been willing lenders. Quebecor World carries $2.5-billion of debt. Mr. Peladeau misread the sea change in sentiment among lenders that has come with the credit crunch.

It is likely that the company will be sold up in the short term as soon as the existing lenders can get as much as they think possible for the debt they own. Existing shareholds - primarily Mr Pelaseau's holding company may get nothing.

Update:
A Canadian judge has agreed to allow the company to seek protection and the company is likely to receive the same protection this morning in New York.

An update and more background from The Toronto Star.