Redrow reassured investors with a debt facility to help it through the housing downturn, as it revealed profits for the year were wiped out by land writedowns.
The housebuilder reinforced the gloom in the sector by forecasting it was 'highly likely the markets will persist for some time to come' and that no recovery was expected in the mortgage market before 2010.
The likelihood of a protracted slump pushed Redrow to re-arrange financing for its £223m of net debt, with a slightly reduced £450m total facility extending to 2011.
The deal removes the prospect of Redrow breaching debt covenants, but it will increase its borrowing costs by 200 basis points on top of a £5m arrangement fee.
The distressed housing market forced Redrow to revalue its land and work-in-progress assets down £259m, or about 40%.
Financial Times, The Times, Daily Telegraph, The Independent