Australian shopping centre investor Centro Properties has put itself up for sale after struggling to refinance short-term debt.
The company, which is the second largest shopping centre in Australia and the fifth largest in the US, told the Australian Stock Exchange today that it was considering a range of options including a complete or partial sale of its business, a recapitalisation or an issuance of new equity.
Rapid expansion
Centro ran into problems after struggling to refinance A$3.9bn (£1.7bn) of short-term debt ahead of a 31 December deadline.
Centro had used the debt to fuel a rapid expansion in the US, and had hoped to refinance through the commercial mortgage-backed security market.
However, the global credit crisis has seen this market virtually dry up. Centro has a new deadline of 15 February to refinance the debt, and is weighing up its options ahead of this deadline.
Plummeting shares
The company grew rapidly on the back of high levels of debt, leaping from A$10bn (£4.4bn) in assets under management in January 2006 to A$26bn (£11.5bn) today.
Centro cuts its earnings estimate for 2008 by 13% and suspended its first-half dividend as a result of its problems.
Its shares dropped 76% in December when the refinancing troubles became public, and its market capitalisation is now less than A$1bn (£444m) compared to A$9bn (£4bn) in May.
