News

New Star shares suspended on bank talks

01 December 2008 07:27:00

Fund manager New Star suspended its shares this morning as it said it is "advanced and constructive discussions with its bank syndicate".

Pending the outcome of these discussions, New Star has requested a temporary suspension of its ordinary shares, it said in a very brief statement.

Shares in New Star have fallen by over 90% this year and last month it put a temporary block on redemptions from the New Star International Property Fund after an increase in withdrawals from a few institutional clients caused a cash crisis.

The talk currently underway are said to be centred on a possible debt-for-equity swap that would see a group of banks that includes HBOS, Lloyds TSB, RBS, HSBC and National Australia Bank take a majority take in the fund manager in return for wiping out its £240m debts.

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