Barrie blogs on Targetfollow’s chances

Posted by: Giles Barrie

22 October 2010

So Targetfollow lives to fight another day – but its potential saviour isn’t Patron Capital, the American group that was the subject of speculation last week.

I understand that the `institutional’ group which Targetfollow has lined up does, though, want to inject enough cash to help cure the covenant and interest rate swap problems that have beset the group.

There is also the possibility of further funds being forthcoming to help fund some of the development opportunities in Targetfollow’s stable.

But will Targetfollow survive? Read on.

The company has been the subject of so much gossip in recent weeks – not all of it kind.

Targetfollow’s `Can of Ham’ office scheme in the City is, for example, now nicknamed `Spam’ as the market derides the potential of this and other schemes.

But compared with some of the basket cases in property, Targetfollow does at least have some hope based on much of its estate being in central London.

If chairman Ardeshir Naghshineh can persuade Lloyds, to whom Targetfollow owes more than £700m, to accept his potential partners’ plan then he can at least depart the stage with pride intact.

Targetfollow revealed its talks with its new investor ahead of another date in court to face administration next week.

While Targetfollow has been thrown a lifeline, my own reckoning is that its chances of survival are still 50/50 at best. Lloyds has been deeply frustrated by the whole process – it is, after all, owed a huge amount of money – and may not have the patience to see this one out.

Naghshineh is probably right in saying that his portfolio will one day regain much of its value – but Lloyds now needs money back in, fast.