05 December 2011

Clayton Utz advises on Centro Group restructure

Melbourne, 5 December 2011: Clayton Utz and co-legal adviser Maddocks have advised Centro Retail Limited and Centro Retail Trust (CER) in relation to the complex restructure of Centro Group, which was approved by the Supreme Court of New South Wales on 1 December 2011.

The Clayton Utz team acting on the transaction has been represented across both Melbourne and Sydney offices. Corporate group partners Brendan Groves and John Moutsopoulos, senior associates Courtney Dixon and Erik Setio, and senior lawyer Warrick Louey have formed the core transaction team. Litigation & Dispute Resolution partner Fred Prickett and senior associate Xuelin Teo have advised on litigation aspects, while Litigation & Dispute Resolution partner Paul James and Banking special counsel Tricia Moloney provided specialist insolvency and banking law advice.

The restructure will result in the creation of a new ASX-listed quadruple stapled entity, Centro Retail Australia, by the aggregation of the assets of CER, Centro Australia Wholesale Fund and Centro DPF Holding Trust (a subsidiary trust of Centro Direct Property Fund). Centro Retail Australia will be internally managed and will own or manage approximately $7 billion of quality retail shopping centres across Australia, with a $4.4 billion portfolio of direct property investments, and up to $2.6 billion of assets under management via the ownership of one of the largest unlisted property syndicate businesses in Australia.

On implementation of the restructure, approximately 74 per cent of the securities of Centro Retail Australia will be transferred to the Senior Lenders to Centro Properties Group (CNP), in consideration for the cancellation of approximately $2.9 billion of debt. These debts would otherwise have fallen due in mid December this year.

In early March this year CER announced that it had entered into discussions with CNP, CNP's Senior Lenders and other Centro managed funds to agree the terms of an amalgamation of their respective portfolios. In August the parties announced the execution of an implementation agreement, and on 22 November, all of the various stakeholder groups approved the aggregation and debt cancellation.

The restructure is one of the most complex restructures ever undertaken in Australia and the parties have been forced to overcome considerable hurdles throughout the extended process in order to deliver the transaction through to this stage.

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Clayton Utz communications are intended to provide commentary and general information. They should not be relied upon as legal advice. Formal legal advice should be sought in particular transactions or on matters of interest arising from this bulletin. Persons listed may not be admitted in all states and territories.
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Email: Lauren Scott, Head of Corporate Affairs
Tel: +61 3 9286 6972