Australian investors seem to like Centro's deal with its lenders. It still ultimately means the company will likely be broken up. But now that process can proceed more orderly. That's probably good on all fronts. Forcing too many assets to be sold in today's market could end up depressing prices further. (And remember that Centro has more than 600 U.S. properties.) Extra time is a very good thing in this situation.
SECURITIES in Centro Properties soared yesterday after financiers extended its $5.05 billion debt deadline for a month and agreed on a long-term rescue plan that effectively gives them ownership.
But despite the surge on the back of the company's Tuesday night announcement, analysts say it is just a matter of time before the company is broken up and sold off piecemeal. The deal just gives the banks more time to do so.
"Surely it's a dead man walking," said one analyst.
"It is a bowl of spaghetti that needs to be unwound."
Centro Properties Group securities, which had been at 8.7c before a trading halt, shot up by more than 80 per cent at the start of trade yesterday, and finished 2c higher at 11c, up 26 per cent.
- December 17, 2008, Centro Cedes Control to Banks
- December 16, 2008, Centro Gets Another Extension
- December 3, 2008, Centro, GGP Find Ways to Hang On
- September 29, 2008, Centro Scores Loan Extension
- September 15, 2008, Centro's Deal Collapses
- September 10, 2008, Centro Cancels Mall Sale
- August 21, 2008, Centro Posts $299M Loss
- July 16, 2008, Centro Clears Minor Hurdle With First Asset Sale
- July 1, 2008, Centro to Sell Five Australian Malls
- May 29, 2008, Report: Centro Close to Big Sale
- May 14, 2008, Centro's Shield
- May 9, 2008, Centro Reaches Debt Agreement, Shares Surge
- April 3, 2008, Centro Takeover Rumors Cause Share Surge
- April 1, 2008, Centro Clears a Hurdle
- Feb. 29, 2008, Report: Blackstone, GE, Mulpha, Mirvac Bidding for Centro.
- Feb. 28, 2008, Centro Shares Surge
- Feb. 15, 2008, Centro Wins Extension
- Jan. 15, 2008, Scott Out, Rufrano In at Centro
- Jan. 10, 2008, Daily Centro Update
- Jan. 9, 2008, UBS Cuts Stake in Centro
- Jan. 3, 2008, Centro: Morgan Stanley, Westfield Have Approached Firm
- Jan. 2, 2008, Centro Says Its Getting Offers
- Dec. 18, 2007, Another Round of Centro Coverage
- Dec. 17, 2007, Centro Hit by Credit Crunch