Sharechat Logo

Babcock & Brown Power stock tumbles on impairment charges

Monday 18th August 2008

Text too small?
Babcock & Brown Power shares slumped 31% after the biggest generator on the ASX said it would take A$452 million in charges to write down its Alinta unit and to sell a power station at a loss.

The stock fell to 29.5 Australian cents after the statement. The company's market value has shrunk to a sixth of its worth three months ago.

The company has agreed to sell the Tamar Valley Power Station to the state government of Tasmania for A$100 million in cash after spending A$223 million on construction. The transaction nets out at a A$42 million loss. The company will also take a A$410 million impairment charge against the assets of Alinta.

The utility also announced it has hired UBS AG to conduct a strategic review of the company, it said. Babcock & Brown Power gained approval from lenders to extend a A$120 million loan until March 31 next year, when the company would have be able to repay the debt from cash reserves and the proceeds of asset sales.

The company reiterated its forecast for 2008 EBITDA of A$330 million to A$340 million.

By Jonathan Underhill

  General Finance Advertising    

Comments from our readers

No comments yet

Add your comment:
Your name:
Your email:
Not displayed to the public
Comments to Sharechat go through an approval process. Comments which are defamatory, abusive or in some way deemed inappropriate will not be approved. It is allowable to use some form of non-de-plume for your name, however we recommend real email addresses are used. Comments from free email addresses such as Gmail, Yahoo, Hotmail, etc may not be approved.

Related News:

Greenfern Industries Limited (NZX: GFI) Releases Interim Results
Hallenstein Glasson Holdings Limited (NZX: HLG) Announcement of Final Dividend
26th November 2021 Morning Report
EROAD Limited (NZX: ERD) Accelerates Towards Next Phase of Growth
Stride Property Ltd & Stride Investment Management Ltd (NZ: SPG) Placement Size Increased Following Strong Demand
General Capital Limited (NZX: GEN) Announces Very Strong Growth
25th November 2021 Morning Report
Gentrack Group Limited (NZ: GTK) Annual Results for the Year Ended 30 September 2021
Pacific Edge Limited (NZX: PEB) Results for Six Months Ended 30 September 2021