bbi warns of wipeout threat, page-8

Hi Apples,

The following is my opinion only and I don't have a background in finance.

Quoted from Business Spectator:
"The company's debts include $9.1 billion in proportionate debt and $1.2 billion in corporate debt facilities. Of that, about $2.7 billion is due to mature in financial years 2010 and 2011, including $300 million due in February 2010.

It is understood the eventual recapitalisation will see BBI's debt as a percentage of equity fall to less than 70 per cent from about 98 per cent, and the group will need to sell at least one asset, the paper said. "

I'm not sure where they got 98% from but you can bet your bottom dollar that CSI is using these sort of numbers to negotiate, with the threat of administration a very unpalatable plan B. This leaves a very small piece of the pie for current ords / BEPPA / SPARCS. It also sets up conflict between the groups - with so few scraps the dogs will be snarling at each other.

Even if we get as far as CSI formalising a proposal, it will be very hard to please all current BBI steakholders and there is a high risk the deal with fall through.

At some point investors will say: "X cents in the dollar? That's an insult! Let the administrators sort it out! I don't care if I never see a penny!" Just look at BNB.