centro trading halted...debts due...

Source: www.theaustralian.news.com.au/business

Centro trading halted, debts due
May 07, 2008

CENTRO Properties Group and Centro Retail Group both have been placed in trading halts pending the release of an announcement with the groups owing Australian lenders $2.3 billion.

Securities in both companies will not be traded until either normal trading begins on May 9, or an announcement is made.

Shopping centre owner Centro Properties (cnp.ASX:Quote,News) was granted a seven-day extension until today to finalise a longer-term extension on $2.3 billion in debt owed to its Australian lenders.

The extension also effectively covers another $US450 million ($473.98 million) in US private placement notes whose holders have agreed to act in line with Australian extension arrangements.

Complicating the picture are two other debt obligations of $US1.3 billion ($1.39 billion) and $US1.2 billion ($1.29 billion) owed by Centro and Centro Retail Trust for their US joint venture.

Those debts already had been refinanced to September 30 but the extensions also were contingent on Centro's $2.3 billion debt due on April 30 being refinanced.

Centro's troubles began after it borrowed heavily to pay for acquisitions to spearhead expansion, especially in the United States.

It was caught out by the global credit crunch and struggled with the leverage on its 800-centre property portfolio, spanning Australia, New Zealand and the US.

With around $25 billion in assets under management, Centro is Australia's second largest shopping centre owner.

Last December, Centro and its stable of companies admitted their difficulty in refinancing short-term maturing debt.

Centro is trying to pay down its debt by selling some of its portfolio, including one of its Australian wholesale funds that holds 28 properties.


Ends.

Cheers, Pie :-)