Lenders extend Centro's debt deadline Maurice Dunlevy | June 03, 2008 The Australian Online
LENDERS owed more than $2.77 billion yesterday extended Centro's debt deadline until December 15.
The extension was granted after additional liquidity facilities totalling $155 million were provided by its bankers.
The facilities will be used to fund capital expenditure, adviser fees and higher lender costs incurred as a consequence of the extension arrangements.
Centro stapled securities rose as high as 42c in morning trade before falling back to close 2c lower at 36c.
Stapled securities in its listed trust, Centro Retail Trust, closed 2c higher at 43.5c, after earlier trading up to 45c.
The deadline extension will allow Centro to continue talks on asset sales to raise funds to repay the debt.
Shaw Stockbroking head of research Brent Mitchell said investor confidence in the company was unlikely to be significantly boosted until asset sales had been secured.
"People are really waiting for the asset sales and once those asset sales are announced I think continuation certainty increases, and you will get a boost to the share price," he said.
"I think then (investors) will wait to see (the full-year) results come through, and it may be that the full-year results will help (Centro) ... since auditors have been over it and all the negatives are out there.
"Obviously, this has been a negative watershed year, and if they are sensible, they will write off as much as possible."
Mr Mitchell said the extensions were positive news.
"The more likely extensions are granted, the more likely these things are going to work their way through," he said.
The financing extension remains subject to certain conditions flagged on May 8.
They include Centro's Australian financiers, US private placement noteholders and a US lending group reaching further agreement by September 30 on the terms on which Centro assets can be sold.
The Australian financiers and US private placement noteholders must be satisfied as to Centro's progress in implementing its strategic plan.
CNP Price at posting:
0.0¢ Sentiment: Buy Disclosure: Held
