Banks are likely to emerge with a significant slice of Babcock & Brown as part of an emergency $150m funding package aimed at heading off the collapse of the struggling infrastructure group.
Following a marathon round of talks with its 25-member banking consortium over the past fortnight, Babcock finally secured the rescue deal which will give it breathing room to push ahead with a program of asset sales to pay down a crippling multibillion-dollar debt facility. The new funding deal will be through additional loans due to be repaid by December next year.
The new loans, mostly funded by the big four Australian banks, will rank above the existing corporate facility and will be used mostly to fund wind-farm and other infrastructure developments in North America.
The financing will carry a substantially higher interest rate.
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