Thursday 8th January 2009 |
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The company wants to buy enough time to sell assets to repay debt and prevent collapse. Yesterday it said impairment charges mean liabilities "substantially" outweigh assets.
"The group's banking syndicate has indicated that it will be providing later today a partial response to the proposal," it said in a statement. "The trading halt will end upon the syndicate providing a complete response which we expect to occur before the opening of the market" on January 12, it said.
Shares of the firm's infrastructure and energy units, which trade separately on the ASX, tumbled today. Babcock & Brown Infrastructure dropped 14% to 12 cents and Babcock & Brown Power fell 13% to 10.5 cents amid concern their finances would suffer if the parent fails.
The five largest banks in Australia have about A$700 million in loans to Babcock & Brown and overseas banks are owed as much as A$2 billion, according to analysts.
The company is trying to avoid the fate of Allco Finance Group, a manager of funds that collapsed last year.
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