WESTERN Australian property developer Port Bouvard Limited has secured a debt extension from its banker St George Bank to 31 December 2012.
The group has three facilities and since July 2010, it has reduced debt by $92 million from equity funds, sales of Oceanique apartments and sales of non-core assets. At 31 October 2011, net gearing was 26%.
Port Bouvard CEO John Wroth said the offer from St George required substantial and permanent reduction in the facilities as part of the facility terms.
Specifically, the facility terms from St George requires the land Acquisition facility limit to be permanently reduced to $5 million from $30 million.
The only available source of funds to the company are those which the company had set aside to fund the stage one and initial external infrastructure costs of Point Grey, which were raised pursuant to a capital raising completed during July 2010.
“After review of all available options, the directors have determined that it was in the best interests of the company and its shareholders to reallocate the majority of the Point Grey funds toward permanent debt reduction as required by St George
“At 31 October 2011 the group held cash of $7.4m. The company will apply sufficient cash against the land acquisition Facility to ensure it meets the requirement under the new facilities,” he concluded.
Australian Property Journal
