Strategic steps up restructuring negotiations

Strategic Finance and its trustee yesterday confirmed the stricken company is negotiating with a number of suitors over restructuring plans including a Hanover/Allied-style debt for equity swap.

Strategic disclosed last month that it had breached the terms of its year-old moratorium firstly by failing to make an initial repayment to its 15,000 retail investors who are owed about $325 million. The moratorium was further placed in jeopardy when the company disclosed it had been forced to write down the value of its remaining assets to below 75 per cent of its liabilities.

Chief executive Kerry Finnigan yesterday told the Business Herald the company was sifting through a number of offers.

"Some of them are reasonably well advanced. Some are at the early stages. We are keeping the trustee abreast of developments and we are starting to discount those that are not in the best interests of investors."

Finnigan said the company was "weeks not months" away from an announcement.

Trustee Matthew Lancaster of Perpetual Trust said he'd been informed of various proposals including debt for equity deals.

"Some of these proposals need further refinement and also measurement against the other options of continuation of the moratorium or receivership." Lancaster said details of a preferred bidder could be made public relatively soon, "but final resolution may be a couple of weeks at least".