centro buys time for carve up...

Source: www.smh.com.au/business

Centro buys time for carve-up
Carolyn Cummins | March 29, 2008

PELORUS Property Group's raid on Centro Properties' $2 billion syndicate business hit a further hurdle yesterday when, at the 11th hour, it postponed until May 20 three meetings scheduled for coming weeks.

Key investors said the deferment suggested Pelorus did not have the numbers to succeed in its quest to manage Centro's MCS 16, 11 and 19 NZ/I syndicates.

Pelorus needs 75 per cent of the vote to take over management of the syndicates. Its directors have argued that Centro should not be allowed to vote because it is not a direct investor in the syndicates. Centro has disputed the point.

The first meeting, for syndicate MCS 16, was set down for Monday at Pelorus's serviced office in Neutral Bay. It was to be followed by MCS 19 NZ/I on Wednesday and MCS 11 on April 10.

The delay came as Centro confirmed its Australian bankers were in "deep discussions" about extending the deadline to repay the first, $2.3 billion tranche of debt, from April 30 to September 30. It is understood an agreement was reached for the entire $4.2 billion to be repaid on the later date.

Centro said the April 30 cut-off did not give it time to conduct an orderly sale of the business. The group has another six months to find a buyer for all the business or to sell individual assets. The company's chief executive, Glenn Rufrano, planned to rescue the group by raising cash through a combination of selling its interest in the Australian and US wholesale fund and/or an equity injection. He planned to retain control of the funds management, syndicate business and centres.

Pelorus's chief executive, Stuart Brown, explained in a statement yesterday that it had deferred the syndicate meetings for six weeks because of uncertainty surrounding Centro's finance. In the notice to unit-holders, Pelorus also said it would be the direct manager of the syndicates but proposed to appoint Trust Company as the overall responsible entity, to avoid the same conflicts of interest and lack of transparency that it claims took place under Centro's tenure.

A spokesman for Centro hit back, saying: "Based on the proxies that Centro MCS believes have been lodged, Pelorus was staring at defeat at all three scheduled meetings."

The manager of Centro MCS Syndicates, Gerard Condon, added: "It is disappointing that Pelorus has cancelled the meetings of investors on incredibly short notice and without any credible reason, particularly given the confusing, misleading and aggressive campaign they have waged against Centro MCS."

Centro closed up 4c to 28.5c.


Ends.

Cheers, Pie :-)