Quebecor withdraws bond issue it planned to use to buy Osprey

One of the ways that Quebecor was going to pay for its purchase of Osprey Media Income Fund was to sell a junk bond issue. But the company has cancelled plans to float a $750 million issue in the face of what's described as "a jittery junk bond market", according to a Reuters story. Quebecor's timing could hardly have been worse, having announced its plans only a day before there was a sharp selloff of so-called "junk" or high-yield bonds as U.S. investors worried about weakness in the U.S. sub-prime mortgage market.

Not only was the Osprey sale to be financed in this way, but so was its plan buy all of the common shares of Nurun it did not already own, and to make a payment to the Carlyle Group.