UPDATE 2 - Australia's Centro shares surge, says in talks
SYDNEY, April 3 (Reuters) - Australia's debt-laden Centro Properties Group (CNP.AX: Quote, Profile, Research) said it was still in talks about restructuring and funding, after its share price briefly doubled on a report that several bidders had offered to buy stakes at a premium.
The group, which borrowed heavily last year to fund a rapid U.S. expansion but became a high-profile casualty of the global credit crunch, faces an April deadline to refinance A$5.4 billion ($5 billion) of debt and is under pressure to sell assets to raise cash.
The Australian Financial Review, without citing sources, said on Thursday that Centro was believed to have received six offers, including from private equity firm Blackstone Group (BX.N: Quote, Profile, Research), Citadel Investment Group, Macquarie Group Ltd (MQG.AX: Quote, Profile, Research), and investment management group Lighthouse Partners.
The offers were at up to around A$0.90 a share, the paper said. Centro shares rose to a high of A$0.65 before falling back to A$0.505, up 71 percent, before trading was halted. The shares had traded at above A$10 last May.
"It's a group that attracts a whole different calibre of investor today than it did six months ago," said Jamie Spiteri, senior dealer at Shaw Stockbroking.
"It's not necessarily attracting long-term institutional support, it's more just speculative trading activity."
Responding to a query from the stock exchange, Centro said in a statement it was unaware of any reason for the sharp move in its shares.
It said it remained in talks with a number of parties and lender groups in relation to its recapitalisation process, but the talks remained incomplete.
"At this time, there is no certainty or assurance that these discussions will lead to a transaction, what form such transaction may take, or what value might arise out of a transaction, if any," it added.
Centro has seen its shares plunge 91 percent since it warned in December it was struggling to refinance a hefty debt burden. The owner of 700 U.S. shopping malls ran into trouble when credit markets froze last year and its usual avenues of borrowing shut.
Last week Centro said it was pleased with progress on extending the April 30 refinancing deadline, but had not yet reached an agreement with creditor banks. ($1=A$1.09) (Reporting by Ben Wilson and James Thornhill; Editing by Anshuman Daga)
Ends.
Cheers, Pie :-)
CNP Price at posting:
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