Finance

Babcock & Brown on the brink

SmartCompany /

Shares of Babcock & Brown, which were set to resume trading today, will remain suspended while it continues to negotiate with a bank.

Shares of Babcock & Brown, which were set to resume trading today, will remain suspended while it continues to negotiate with a bank.

The suspension this morning came as Babcock announced in a statement that two directors – Dieter Rampl and Joe Roby – had resigned. No reason was given for the resignations.

In the statement today, Babcock says: “It is expected that the suspension will end when BNB is in a position to make a further announcement in relation to those discussions and negotiations, which is expected to be early during the week of December 1.”

Fears are growing that the Australian financier is close to defaulting on its billion-dollar loan portfolio. The financier is in dispute with a major lender German regional bank WestLB over a deposit of $150 million.

The financier owes the banks $3.1 billion and says it is likely to breach debt covenants. However Babcock spokeswoman Kelly Hibbins says the company was not close to default.

“It is not a default situation,” Hibbins told The Australian.

Related stories:

 

Advertisement
SmartCompany

SmartCompany is the leading online publication in Australia for free news, information and resources catering to Australia’s entrepreneurs, small and medium business owners and business managers.

We Recommend

FROM AROUND THE WEB