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Allco Finance's Singapore arm gets debt extension |
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By: Danny John theage.com.au 26 march, 2008
THE Singaporean real estate arm of Allco Finance Group has pushed back a deadline to repay $S550 million ($A434 million) of debt that will relieve any demands for a swift sale of its recently expanded property portfolio.
Allco Singapore, which manages the locally listed Allco Commercial Real Estate Investment Trust, hopes to complete the refinancing terms in the next few days, after securing the extension of the debt's maturity date from the end of July to December next year.
Wrapping up the new terms will be a significant move for Allco REIT which, like Allco's Rubicon offshoots in the US and Europe, has faced tightening time pressures to relieve debt and avoid asset fire sales.
In a statement released to the Singapore Stock Exchange, on which Allco REIT listed two years ago, the trust and its manager said the next key step was to complete the paperwork with the bankers involved.
"The manager is reviewing the terms and conditions of the extension and will execute binding documentation as soon as practicable," the statement said.
But the news was followed by an announcement from credit ratings agency Moody's saying it had downgraded Allco REIT from Ba1 to Ba2 as a result of the refinancing effort.
Moody's would also continue to review the situation once the impact of the deal became clearer.
Allco Singapore's chief executive, Nicholas McGrath, yesterday told BusinessDay that while he was always confident the refinancing would go ahead, he was nonetheless delighted it had been agreed on reasonable terms in the current state of global credit markets.
In a related move, the trust is planning to clear a further $70 million of debt that is due to mature on November 22, with the proceeds from the liquidation of an Allco-branded and unlisted entity, the Allco Wholesale Property Fund.
For more information: http://business.theage.com.au/allco-finances-singapore-arm-gets-debt-extension/20080325-21ib.html
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