Centro's Shield

Interesting story about Centro's corporate structure in today's Wall Street Journal.

Centro Properties Group used a complicated and often-opaque capital structure to grow into one of the world's largest and most debt-laden shopping-center owners.

But now that Centro is in hot water with its lenders, that structure is serving a new purpose: It has become one of the factors deterring creditors from liquidating the company, based in Melbourne, Australia, that owns interests in roughly 670 shopping centers in the U.S. and 130 in Australia.

"Centro has been like the game of Jenga: 'Watch the tension mount as the tower builds,'" says Andrew Parsons, managing director of Sydney-based Resolution Capital Ltd., a Centro investor that sold its shares in January amid the company's struggles. "Right now, the banks don't know which piece they can pull out without the whole thing falling over."

Link.