Just thpought I would post this to give some general optimism as to what may happen should a longer term extension be provided.
The post below was at the time the last extension was granted.
I do note what GR said after the last extension (read below) but here is an extract.....
"the group did not have to meet particular conditions for asset sales, or complete a planned debt/equity swap, in order to satisfy its lenders for the next extension on Dec. 15."
Anyway might help some sleep a little better.
cheers.
MELBOURNE, Sept 29 (Reuters) - Centro Properties Group Ltd (CNP.AX: Quote, Profile, Research, Stock Buzz), one of Australia's highest profile casualties of the global credit crisis, said it has won a three-month extension on a $1.3 billion loan, sending its shares up almost 50 percent.
Centro, which owns 665 U.S. shopping malls and is the third-largest mall manager there, also voiced optimism about winning a further extension in December for a total of $4.2 billion it owes to U.S. and Australian banks.
Centro has been struggling to refinance debt after credit markets seized up following its rapid expansion last year. It has won a series of extensions on its various debt facilities as it seeks to sell shopping malls to repay borrowings.
On Monday, U.S. lenders including JP Morgan (JPM.N: Quote, Profile, Research, Stock Buzz), Bank of America (BAC.N: Quote, Profile, Research, Stock Buzz) and Wachovia (WB.N: Quote, Profile, Research, Stock Buzz) agreed to an extension on $1.3 billion in debt till Dec. 15.
Another $450 million owed to U.S. noteholders and A$3 billion ($2.5 billion) owed to Australian banks also expires on Dec. 15.
Analysts said the latest extension could help the company amid the ongoing financial woes in the United States.
"It's good news, a little bit of breathing space," said Constellation Capital Management investment manager Richard Morris.
"It gives them another three months to find a solution. With the bailout package in the U.S. ... you may see some sort of easing of the credit situation or some sort of freeing up of the property transaction market."
Centro has struggled to find buyers due to difficult market conditions. An agreed $714 million sale of 29 U.S. shopping malls fell through earlier this month.
Chief Executive Glenn Rufrano told reporters the group did not have to meet particular conditions for asset sales, or complete a planned debt/equity swap, in order to satisfy its lenders for the next extension on Dec. 15.
"I think their extension will always be based upon simple logic, which is if we go into administration, what will the banks collect on their receivables versus a longer-term transaction with us?" Rufrano said.
"If the lending groups don't extend -- we would go into administration," he said.
Indeed, he did not expect much improvement in the market for shopping malls between now and the end of the year, suggesting further major asset sales are unlikely before the deadline.
"There is going to be continued paralysis," he said.
Centro agreed to sell four Australian and New Zealand malls this month for A$157.5 million.
Centro shares rose as much as 47 percent and were up 29 percent at A$0.11 cents at 0420 GMT, on heavy volume of 61 million shares. The stock has fallen 98 percent from above A$8 last October before news of its credit problems. ($1=A$1.20) (Reporting by Victoria Thieberger and Miranda Maxwell; Editing by Lincoln Feast)
CNP Price at posting:
8.7¢ Sentiment: Buy Disclosure: Not Held
