fire sale by 15 feb 2008 with ccc junk rating, page-25

Of course the rents paid by tenants are considered in the overall value of the centres
The centres if they are sold, will be priced (among other things such as ability to expand etc)on a yield which is directly related to the leases..

ZWU
I'm always appreciative of someone with an alternative view to mine so I dont get too wrapped up in my own B/S, but in this case you are over the top on the negative side.

Of course:

IF they don't make some changes to their balance sheet ratios by selling some properties
or
IF they don't get equity partners
or
IF the banks won't lend them the funds required before the Feb deadline they will be CCC junk...

But right now that is a possiblity NOT a probability.

They will sell some assets and I would imagine, as other posters have pointed out they will get good money for them.
Not the pennies in the pound scenario you so gleefully predict.

There is a real possibilty of someone taking further equity in Centro.

Banks ARE in the business of lending money.
Thats how banks make profits.
By mid Feb they will have money to lend.
And Centro have NEVER defaulted on a loan and demonstable cash flow to satisfy the banks.
The sort of client that banks like !

So they have three very realistic and probable sources.
Seperate independant sources to rectify their current funding situation

OR
a combination of more than one source

All three are on the table, and every one of them is desirable for would be suitors/ investors/ bankers.

Sure, Centro my have to pay a few points above the going rate to borrow funds, but their current cash flow from rents and the fact that they have held back paying a dividend means they have ample cover to make any loan repayments
(In fact the have that ability to fund the ENTIRE ROLL OVER amount RIGHT NOW without any debt reduction or capital raising)

So their "potential" CCC junk rating is simply not a realistic assesment of the situation.

It gets back to the manic attitude of the market and the panic of some of its players.

An example of fear and greed at its finest.

Cheers

Bendigo