endemol-logoThat’s the only option open to shareholders Mediaset, Goldman Sachs and Cyrte, one media analyst tells me. Whether Mediaset owner Silvio Berlusconi or TV magnate John De Mol, the man behind Cyrte, will be happy doing so is another question. I’m told De Mol in particular would be reluctant. There’s been speculation here that the super-producer will breach its debt covenants as soon as August. Endemol assures me this is not the case. “Given our current outlook, and taking into account the resources already available to the company and its shareholders, we strongly expect to continue to fully comply with our debt covenants for the foreseeable future,” Endemol says.

The company is €2.4 billion ($3 billion) in debt after a 2007 buyout. Combined with the cancellation of Big Brother on Channel 4 and NBC scrapping Deal Or No Deal in the US, it’s argued that the producer’s future is looking pretty bleak.

On the other hand, BBC1 just started an eight-part primetime summer run of the producer’s format 101 Ways to Leave a Gameshow. Fox in the US has commissioned a broadcast pilot of the show. Germany, Brazil and Turkey are making their own versions of the show, where contestants are violently ejected from the quiz.

One option not there anymore is buying back its own debt cheaply and marking it as operating profit. Endemol was rapped on the knuckles for doing that earlier this year, although it was perfectly allowable. Hedge funds representing around 20% of senior debt complained what Endemol was doing was just financial engineering to avoid breaching debt covenants, and masked the producer’s true financial predicament.

Endemol’s problem, like many independent TV producers, is that broadcasters are putting their money into five hit shows each year –- think The X Factor or American Idol – filling the rest of the schedule with cheap TV. This means independent producers are not earning those fat fees they once were. Broadcasters may want bigger and better “event” TV but that doesn’t mean they’re prepared to pay bigger and better prices.

Mediaset, Goldman Sachs and Cyrte paid €3.4 billion for Endemol, with debt of €2.2 billion supplemented by more than €1 billion of equity.