We all know if there is a T/O, we would all be laughing all the way to the bank.
However here is an example of what would happen if it doesn't go our way. ___________________________________________________________
Timbercorp teeters after asset sale fails Lucy Battersby April 16, 2009 - 1:07PM http://www.businessspectator.com.au/bs.nsf/Article/Timbercorp-looks-to-renegotiate-debt-R69F2?OpenDocument
Plantation giant Timbercorp faces an uncertain future after it failed to sell assets to raise money to re-pay debt.
Timbercorp has drawn on $562.9 million of loans from syndicated and bilateral facilities, with payments of $10 million due on May 1, 2009, and further repayments due throughout 2009.
"Unless the company is able to reach agreement with its financiers to restructure the exisiting debt facilities, there is significant uncertainty regarding the ability of the company to continue as a going concern,'' the company wrote in a statement on its website today.
Timbercorp went into a trading halt on Tuesday, April 13, and shares fell to 7 cents when they resumed trading this morning. Timbercorp shares have lost 39% of their value over the past year.
Last November Timbercorp announced it would start an asset sale program to pay down debt.
However, today the company annouced the offers it received were "at values substantially below book value and are incomplete and condition in nature".
"The company is continuing the sale process but, based on the offers received to date it is unlikely that the company will be able to sell the forestry assets within the timeframe required.''
"Indeed, there can be no assurance that a sale will be achieved,'' the company stated.
Timbercorp was established in 1987 and listed on the stock exchange in 1996. It manages large-scale farms across Australia, as managed investment schemes, and has 120,227 hectares of plantations.
It grows and sells almonds, olive oil, citrus, table grapes, mangoes, and avocados, and timber from eucalyptus plantations.
It has 180 employees and and is responsible for a further 1500 employees and contractors throughout regional Australia.
According to its website, Timbercorp had assets of $595.6 million in September last year.
AIO Price at posting:
$1.01 Sentiment: None Disclosure: Held
