Centro rallies as new boss rules out fire sale Carrie LaFrenz | 25 January 2008 - 9:54AM
Securities in Centro Properties Group rose by more than 35 per cent yesterday after its new boss expressed optimism about securing an extension for a $3.9 billion debt refinancing, and ruled out a fire sale of its assets.
American Glenn Rufrano, who was last week named chief executive after Andrew Scott resigned, also said the company would open a data room next week for potential buyers of some or all of its interests, including two wholesale funds.
Australia's second-largest shopping centre owner fell victim to the global credit crunch and recently asked bank lenders for an extension to a February 15 deadline to refinance its maturing debt.
Mr Rufrano, who was head of Centro's US business for the past nine months, was optimistic that lenders would extend the deadline.
"The banks are not going to put themselves in a position with us that will make it untenable for them and us as long as we are doing our jobs," he said.
He said Centro owned good quality properties.
"The problem we have is the balance sheet issue, it's not an operating issue," he said.
Mr Rufrano met with local banks last week and will be meeting with US banks next week when he returns to the United States.
Centro stapled securities rose 12.5c or 35.21 per cent to 48c.
The securities have lost about 90 per cent of their market value over the past month.
Centro is considering the sale of its investments in the Centro Australian Wholesale Fund and Centro America Fund, which have $2.6 billion and $1.1 billion under management, respectively.
But Mr Rufrano said he had no plans to sell the group's more than 800 shopping centres across Australia, New Zealand and the US.
He said Centro had delayed the opening of its data room by a week because it was bulking up the data to be made available to interested parties.
Mr Rufrano was tight-lipped about those interested but said there was "heavy interest" globally.
There is speculation Colonial First State, wealth manager AMP and Westpac could be among the interested parties.
Colonial has an 8.3 per cent stake in Centro and is the group's largest shareholder.
However, an analyst who did not wish to be named, said names like Colonial, AMP and Westpac would be after management rights, not just stakes in the business.
Mr Rufrano heads to the US tomorrow but will return to Australia within two weeks, along with his wife, after signing a year-long contract. AAP
Ends.
Cheers, Pie :-)
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