THE Babcock & Brown and GPT yesterday warned investors their joint venture in the United States could record a $US82 million loss.
Babcock & Brown said in a statement that a special purpose vehicle, HTM Fund 1 Subsidiary A LLC which holds US loan asset investments on behalf of the JV received a notice last Friday from its lender Wachovia Bank to speedily repay a $US112 million debt facility because of HTM’s decision not to provide the additional collateral requested by the Bank.
“Discussions between the parties are ongoing, however if these talks are not resolved satisfactorily the Babcock & Brown/GPT joint venture may suffer loss upon the liquidation of these loan assets by Wachovia Bank,” the parties warned.
If the Bank does liquidate the loan assets, the Babcock & Brown and GPT will take a hit of $US41 million each, this represents approximately 4.0% of the Babcock & Brown/GPT JV.
The book value of Babcock & Brown’s net equity investment in the joint venture with GPT stood at $169 million as of June 30 2008.
Australian Property Journal
