Ok people Here's the AFr article and interpret it the way u like:
Final bids to buy into or simply take over the beleaguered Centro Properties Group are due this week, and offshore interests are believed to be leading the charge.
The company, one of the largest retail property owners in Australia and United states, plunged into a crisis late last year when it revealed a multi-billion dollar debt funding shortfall.
In January it launched a process to seek new equity either througha straight sale of the business or through a new cornerstone investor.
Market rumour last week put local parties Macquarie group, Lendlease and Mirvac Group in the data room examining a potential recapitalisation of centro, six weeks ut from the deadline.
A lendlease spokesperson said the company was categorically not considering investing in centro, although the Australian financial review understands lend lease could bid for assets that could subsequently emerge from any sale process.
Mirvac is believed to have conducted preliminary due diligence on a centro recapitalisation but has walked away from a possible deal. Macquarie group did not return calls.
One source who had examined Centro said he believed none of the Australian parties that had looked at a recapitalisation would proceed, and the most likely prospect was a carve-up dictated by centro’s banks. “There is no equity there”, he said.
Documentation would need to be underway soon for any recapitalisation of centro to be successful before the April 30 deadline, he said.
There has also been intense speculation about the possibility that a Middle east sovereign fund, such as the Abu Dhabi Investment authority, could emerge as the white knight investor for Centro, but another industry source last week told AFR that ADIA was considering recourse against centro’s directors, rather than putting more money in.
The source said the middle eastern investors were interested in long-term partnership with successful operators, rather than buying distressed assets.
Us-based raider Blackstone has been the focus of a number of rumours although last week it revealed an 89 percent dive in its fourth quarter profit and predicted a takeover finance shortage.
The equity injection, as centro chief executive glen rufarno has called it, is needed to keep a large group of banks at bay and allow company to mount a recovery.
The banks have lent billions of dollars to centro, only some of which is secured. Their ranks include Jp Morgan (2B), Royal Bank of Scotland (1.13B), CBA(1.3B), NAB (1.1B), ANZ (1.2B), BNP Paribas (660M). Several sources said the American banks held a stronger position over centro’s US properties. The bankers have been heavily involved in the process and it is believed they will receive a briefing on a preferred bidder and centro’s proposed direction by early April.
Some sources have suggested, once a corner stone investor was secured , the company could even look to raise equity from existing shareholders.
Centro’s share price has remained in the basement falling from 45cents at the start of the month to close Friday on 31cents.
CNP Price at posting:
0.0¢ Sentiment: LT Buy Disclosure: Held
