Centro announces sale of 10 properties at 60% above book value??????
Now that's not going to happen in the current market.
However unless they get a cracking price then all we are doing in runing on the spot. Just that the hole is only a little smaller.
The best option is still to lean on the lenders to rollover debt and ride out the property downturn. The cashflow on the business is still positive. Lenders have come though a key time over the last two years with the business and I suppose would again rather centro as a customer than a vehicle they have to liquidate.
Let's face it in that situation the lenders would have little bargaining power and are not likely to get great prices. The flow on effect for the wider market would be massive as the sudden appearance of such a large group of properties on the market would depress prices across the board, changing the game for the banks other customers as well.
My point is that centro and its position represents a pivotal maret challenge for the lenders. They can't just cut the funding as it has wider market implications. Or maybe they would.
CNP Price at posting:
15.5¢ Sentiment: Hold Disclosure: Held
