NAB margin loan to Allco exec’s and delayed result
National Australia Bank is currently in discussions with senior executives of Allco Finance Group (AFG) relating to an outstanding margin loan. The loan, a $110 million margin facility secured against AFG shares held by Allco Principal Investors is held by AFG Directors. It is understood that NAB has become a party to discussions that would allow Allco to sell assets for cash, allowing Allco to pay down part of its $6.1 billion debt. The most pressing being a refinancing requirement for $250 million in May. This move may underpin Allco's share price when trading does recommence on its currently suspended stock. NAB is understood not to want to add to the downward pressure on the share price similar to selling triggered last month by other margin calls. No stock within this facility has been sold since NAB's statement to the ASX on January 24. Allco has again delayed its half year results presentation, the second time within a week. It is understood that talks on a rescue plan are at the heart of the delay.
Source: Sydney Morning Herald