Babcock & Brown will extend its share suspension until at least tomorrow as it attempts to thrash out final support for a fresh funding agreement with its bankers.

Talks have entered their 12th day, but sources close to the negotiations were confident a deal could be struck by the middle of the week.

Most of the 25 banks in the syndicate — including the Big Four Australian banks — are believed to be prepared to support the revised proposal in which up to $200 million would be injected into the group, giving it time to push ahead with its planned asset sales. But several overseas banks are yet to commit to the new funding deal, which, if approved, would result in the Australian lenders, which have the bulk of the exposure to Babcock, taking control of any future talks.

The Age