B&B Power suspends share trading News: 13-November-09 by Rebecca Lawson
Uncertainty continues to circle gas retailer Alinta as owner Babcock and Brown Power places a suspension order on its shares as it continues negotiations with the North West Shelf sellers while financiers seek a better understanding of the situation.
BBP today explained the suspension was requested as it remained in the process of assessing the impact of the interim award handed down by an arbitrator earlier this week.
Woodside Petroleum and its Shelf partners have been in dispute with Alinta for more than a year over the price the utility must pay for gas, which forced the matter to a formal arbitration.
The dispute flows from Alinta's refusal to agree to the significant price rise demanded by the Shelf partners as a condition of extending an existing Alinta supply contract.
While details of the interim award have not been made public, BBP's action to place its shares in a trading halt has indicated an unfavourable ruling.
Also speculation is mounting about a likely forced sale of Alinta assets if an agreement is not reached.
BBP today said it is continuing negotiations with the Shelf sellers and other stakeholders in response to the interim award.
"Part of this process involves discussions with the syndicate of banks that have lent to a BBP subsidiary, BBP Finance Australia Pty Ltd," BBP said in a statement.
"The syndicate is seeking an understanding of the implications of the interim award on BBP's business."
In its 2008/09 financial report, BBP's debt stood at $3.2 billion.
The company added that it expects to make an announcement before the start of trade on Thursday.
BBP Price at posting:
7.6¢ Sentiment: None Disclosure: Held
