LIVING & Leisure Australia can see the light at the end of the debt tunnel but the company's recapitalisation deal could fall over if Octaviar is forced into administration.
LLA said yesterday it has significantly progressed its Rights Offer documentation to raise at least $90 million and is confident that it will meet the Rights Offer timetable.
In addition, the company said it has delivered to its senior secured financier, National Australia Bank, a conditional term sheet for new senior secured facilities from another bank and advised NAB that LLA has significantly advanced discussions with James Packer’s Arctic Capital Limited and other bridge financiers to provide bridging finance for the repayment of NAB ahead of LLA receiving the proceeds of the Rights Offer.
“NAB and LLA are still in discussions and NAB’s forbearance remains in place while these discussions continue,” the company said.
But LLA said the deal could fall over if Octaviar Limited is forced into any form of external administration.
“As a consequence of the issues that it is facing, as announced by Octaviar Limited to ASX last week, that could have an adverse effect on the ability of LLA and Arctic to satisfy the condition precedent in the underwriting agreement which requires the responsible entity of LLA to be acquired by
Last week, Octaviar announced that the Public Trustee of Queensland has a notice asserting that an event of default had occurred and declaring that the face value of the notes $348.62 million together with accrued interest to June 04 2008 ($2,836,725.93) are due and payable on June 05 2008.
Australian Property Journal
