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From www.Watoday.com.au:

Allco Financial Group has asked its lending banks to respond within ten days to a request to extend the company's debt repayment schedule, without which it will go into default.

An extension would allow the investment firm to sell assets at higher prices, rather than at current values which have been hurt by the deterioration in financial markets over the past month, chief executive David Clarke told Allco's annual general meeting.

''It's very important that we get the appropriate value for those assets,'' Mr Clarke said.

''The timetable we've proposed is that we get an answer from (the banks) within ten days.

''We believe there are good grounds for agreement.''

Allco is carrying $666.7 million of senior debt, which the company must reduce to $400 million by June next year.

The company has asked its banks to extend the November repayment of $35.5 million and of $111.9 million in December so it is not forced to sell assets under fire sale conditions.

The sales will allow the investment firm to become a smaller and simpler company, focused on aviation, shipping and private equity, Mr Clarke said.
''The goal is to sell off non-core assets (and) reduce the debt ... so it's a tough road.''

At the meeting of shareholders, who appeared resigned to the company's 98% decline in value this year, Mr Clarke said the aim was to sell non-core assets while reducing total debt from $1 billion. He said current assets totalled about $1.25 billion, while the total debt of $1 billion included $350 million of subordinated debt.

The company will become smaller in its staff numbers, with the aim of retaining 150 people beyond 2009, down from the current 330 and 620 in January this year, Mr Clarke said.

Steven Matthews, a shareholder of Allco and director of the Australian Shareholders Association, described the company as being on life support, based on what he'd read.

Shares in Allco fell one cent to 12 cents in recent trading. The stock has plunged from $6.20 at the end of last year.

AAP