done deal?are we waiting for 20th september?, page-14

Note from Investor Services following email highlighting my dissappointment in the CER board not acting on behalf of CER shareholders BEST interests. Outlines reasons to vote for Aggregation.

Thank you for your email and feedback.

I confirm that there is further documentation being issued towards the end of September/early October 2011.

This Explanatory Memorandum will answer all of your posed questions and include the voting documentation.

We advise that if the Aggregation does not proceed;
It is considered likely that CNP will become insolvent and will be managed by an Insolvency Administrator. Despite the fact that CER has improved its financial position and the stability of its capital structure during the past year the appointment of an Insolvency Administrator to CNP would result in significant risks to, and uncertainties for, CER. This is because of CNP??s position as a substantial securityholder of CER, as the owner of Centro MCS Manager, the CER RE, and of other entities which provide property management services to CER, and as the majority investor in the co-owners of CER??s half owned assets. CER has a limited ability to address the consequences of these contractual and structural arrangements with CNP due to the following factors:
?X CER has no employees or management platform of its own and all funds management and administrative services are provided by the Services Business;
?X CER RE is a wholly owned subsidiary of CNP and can only be removed as RE by court order or a vote of CER Securityholders. CNP could vote its CER Stapled Securities on any resolution to replace CER RE and is likely to vote against such replacement;
?X a change of CER RE may also give rise to events of default under CER financing facilities and may also result in CNP and other CNP Managed Funds having a right to acquire CER's property assets under existing co-ownership agreements;
?X property management services are provided under property management agreements between the Services Business and the property owning entities in the CNP Group structure. CER cannot unilaterally terminate these arrangements on an insolvency of the property management service providers without the consent of the other co-owner; and
?X CER's property assets are subject to pre-emptive rights in favour of co-owners in the event of any attempted sale of those assets by CER.
The appointment of an Insolvency Administrator to CNP may result in defaults under CER's finance facilities or under the finance facilities of CER's asset co-owners.
A CNP insolvency would result in an indeterminate period of significant uncertainty for CER. An Insolvency Administrator appointed to CNP will assume all of the existing roles and responsibilities of the current Board of CNP, and has a statutory obligation to maximise returns for creditors of CNP. The current Board of CER can give no assurances as to the actions that any Insolvency Administrator appointed to CNP would undertake.
The uncertainty arising from a CNP insolvency has the potential for a significant loss of value for CER assets and CER Securityholders as a result of all or any of:
?X a suspension of CER Stapled Securities from trading on ASX, with investors not having any liquidity in relation to their investment in CER;
?X a significant decline in the trading price of CER Stapled Securities; or
?X a potential sale of CER's assets in order to satisfy CER's maturing secured debt obligations in the medium term due to difficulties in refinancing these facilities where Insolvency Administrators have been appointed. The price of any such sale would be uncertain.
As stated earlier, we anticipate the CER EM and voting documentation being issued in the next few weeks.
If you have any further queries, please contact Investor Services on 1800 802 400 or email [email protected]
Kind regards