"People needed to read the situation a little better"
This was made difficult by the following statements:
On 26.8.09:
‘BBI’s Managing Director, Jeff Kendrew said: “BBI today confirms it is continuing to work towards binding bids for PD Ports and DBCT. Both these processes have seen interest at both the minority and 100% level. Further details will be released in due course.”’
In the analyst presentation under the heading ‘Other Key Developments’ after the heading ‘Performance Summary’ it said ‘governance and management arrangements, intrernalisation, asset sales’.
On 26.8.09 at p 52 of Appendix 4E of 26.8.09:
‘Babcock & Brown Infrastructure corporate bank debt facilities consist of: … BBI Finance UK revolving facility: This facility has a limit of £82.2 million (2008: £85.0 million) and matures in February 2010.’
Then on 4.9.09:
'As previously disclosed … BBI has approximately $2.7 billion in proportionate debt maturing in FY2010 and FY2011, including approximately $300 million of corporate debt required to be paid down in February 2010. Accordingly, the Board of Directors and management of BBI have been actively pursuing a range of options to provide BBI with the capacity to address these pending maturities. In the absence of repaying or extending these facilities, such facilities will become due and payable on maturity. Until recently, BBI has focused on sales of significant assets as its primary strategy for achieving debt repayment. However, achieving asset sales in the current environment on terms which would realise sufficient funds for the necessary reduction in BBI’s debt is proving difficult, with timing and value outcomes uncertain. Based on present circumstances, BBI’s current asset sales programs (net of expected disposal costs and taxes) are unlikely to realise sufficient proceeds to meet BBI’s FY2010 debt maturities.'
‘It is likely that there will be a requirement for full conversion of EPS and SPARCS in advance of, and in order to facilitate, any equity recapitalisation and that the ownership interests of BBI ordinary securityholders, and EPS holders and SPARCs holders post-conversion will be significantly diluted by the recapitalisation. The transaction mechanics, including any conversion of hybrid securities and the basis on which it would occur, have not been determined. The value outcomes of the transaction for BBI ordinary security holders, EPS holders and SPARCS holders are not certain and may attribute a value to those securities that is less than face value or recent trading prices.’
My posts contain opinion and speculation only. Under no circumstances should you rely on anything said or not said.
BBI Price at posting:
5.3¢ Sentiment: None Disclosure: Not Held
