MELBOURNE (Dow Jones)--Centro Properties Group (CNP.AU), the Australian property trust struggling to refinance A$6.6 billion in debt, Thursday won an extension until Dec. 15 from banks on a parcel of A$2.8 billion of debt that matured April 30, a person familiar with the situation.
The extension will give Centro more time to restructure and seek buyers for two of its unlisted funds, Centro Australia Wholesale Fund and Centro America Fund, which have assets of A$3.7 billion, and fend off insolvency.
Centro had already agreed on a debt extension to Sept. 30 for around A$2.6 billion in debt owed to U.S. and European banks.
Of the remaining A$1.2 billion in debt held by associated funds - Centro Australian Wholesale Fund and Centro MCS - A$800 million is due May 30 and is being renegotiated.
Centro Wednesday halted trade in its stock and in Centro Retail (CER.AU), a property trust it manages, pending an announcement about the debt extension talks.
Last week the company was granted a seven-day extension to renegotiate debt and avoid bankruptcy. U.S. and European banks in February gave Centro until Sept. 30 to refinance loans on the condition that other lenders granted a similar extension.
The company, which has a portfolio of 803 malls in the U.S., Australia and New Zealand worth A$24.9 billion, is expected to make a statement to the Australian Securities Exchange later Thursday, confirming its fourth extension since Dec. 17, when it first informed the market about its mounting debt problems.
Centro incurred its debt through a A$10 billion spending spree on U.S. assets in the past two years, and has been struggling to refinance after the credit crunch increased borrowing costs.
-By Andrew Harrison, Dow Jones Newswires; 61-3-9671-4323; [email protected]
(END) Dow Jones Newswires
May 07, 2008 23:42 ET (03:42 GMT)
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