sparcs, page-22

meerkat - "they look long term screwed to me and I'll be happy to be out once they announce their first asset sales"

That is really it in a nutshell. Are they screwed long term or not or are their assets good enough? Also for me the more immediate question is can they sell enough assets for the right price to reduce gearing and pay off debt and continue to be viable. I think they can, but agree it is on a knife edge as you put it.

boof - "However, in my opinion they will be able to prevent dilution through BEPPA, by issuing equivalent preference shares or some form of buy back after asset sales."

Well true, but not until all debt, including all of the SPARCS and all of the BBI Networks bonds and all of the accrued interest on the prefs are repaid. That is going to require more than just the asset sales they have planned.

Also I cannot see them putting cash into a BEPPA buyback. A restructuring not involving any cash would be more likely. They need to retain their cash.

Harry01 - "Is there any reason corporate debt has to go to zero?"

Well yes, because the banks who lent them the money want it back. You can also be 100% certain that both SPARCS and BBI Networks bond holders want their money back and the harsh sweep facility the banks have put in place indicates they want their money back as well? And which other banks are going to lend money to BBI? Not many I suspect.