Centro Staves Off Liquidation
- Dec 18, 2008
Australia-based shopping center owner Centro Properties Group has avoided liquidation by agreeing to give lenders 90 percent of the company’s stock in exchange for extensions on billions of dollars in debts. The eleventh hour agreement allows Centro to avoid having to sell off its some 775 retail properties, located in the U.S., Australia and New Zealand. Centro’s creditors–including JP Morgan Chase Co., BNP Paribas SA and National Australia Bank Ltd.–will now grant the firm several more years to pay off its $16 billion in debts. The lenders’ acquiescence to the extension may be a sign that the banks feared the bargain basement prices that the properties would have to be sold for should Centro be forced to sell, given the current economic climate. In the wake of the announcement, Centro stock, which had plunged to pennies per share, surged by more than 80 percent in trading on the Australian stock market.