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Hi Nursery,

Yep I should have clarified that. CER with a gearing of 40% would not be entering receivership.

The receiver takes the first slice of the pie when it comes to a receivership (fees and disbursements) and yes it all comes from the CNP kitty.

Eleanor, the receiver will control CNP and the responsible entity but nothing from an operational point of view would change. The receiver would continue trading on the properties as CNP would have. For value to be maximised for all parties, it would be business as usual. Instead of CER paying the responsible entity management fees, we would be paying the fees to the receiver. As Ive said before CNP has been in a quasi receivership anyway over the past 4 years, the only difference being they haven’t obtained the services of a receiver for the substantial costs involved obviously.

If it got to the stage where assets were required to be sold, this would be done in a commercial nature. The receiver would be working through the same issues that CNP has been working through since Dec 2007.

Even if CNP and other related parties entered receivership, Im pretty sure the secured lenders with the consent of the receiver would still look at converting debt to equity or selling assets down progressively rather than engaging in a “self imposed wealth destruction phase”. This would be at no cost to CER.

Why is there so much desperation for this to be pushed through? Why so much scare mongering? CER is in a much healthier financial position now than it has been in the last four years.

Let them go into receivership and we’ll take two.