cnp vs cer, page-7

Geez people,

The reason we are at this price is simple.

Hybrid Securities that give major lenders a 90% hold on the business. If these were converted tomorrow you could cut your holdings value by 90%.

This is the major factor as well as the big question of what the future Centro will be.....

1) Bought out and for what
2) Merged with CER
3) Major assets sold at below current book value

(Note I am listing these, not claiming to know what will occur or ranking the feasibility of them)

The list goes on and on.

This company CNP (stapled securities) is sitting on a mountain of debt that is hard to restructure due to the complicated web of ownership over assets.

A buyer of a group of assets may need approval from not just centro, a group of lenders but also possibly a managed syndicate.

This is why we are still no closer to a sale of something major.

I believe all we will see from the EXPENSIVE advice from investment banks is a fee with no material change to the company.

The major upside and change that will move the ball here is writeups to property values. This changes the negative equity scenario and is the only true way forward without a massive cut to shareholders equity.

If you are in this company hold on tight it will be a bumpy ride.

Announcements will drive where we go from here, or more likely the release of information to insiders.

CER is viewed more favourably because the equity equation is a lot better.