CB Richard Ellis Group, Inc. Message Board

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Strategies & Market Trends : CB Richard Ellis Group, Inc.

CBG 47.31

-0.2%

Mar 19 4:00 PM EDT

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From: Condo	3/25/2009 5:07:04 PM
	of 2

Tue. close: $3.00. Wed. close: $4.92. Change: +64%. Today. CB Richard Ellis Group Inc. (CBG) said its lenders have agreed to ease the terms of its credit agreement to give the firm greater flexibility to navigate weak market conditions. The commercial real-estate services firm has been laboring under a heavy debt load since it acquired Trammell Crow Co. in late 2006, a move that boosted the company's outstanding debt to $2.2 billion from $800 million. While the buy gave CB Richard Ellis a valuable asset as corporations outsource real-estate operations, falling revenue from the brokerage and leasing businesses made that debt a growing concern. The company now expects overall interest expense under the agreement in 2009 to be in line with the 2008 figure, rather than higher. CB Richard Ellis said the amendment provides a higher maximum leverage ratio and a lower minimum interest-coverage ratio through March 2011. In addition, the agreement relaxes the covenant for earnings before interest, taxes, depreciation and amortization through 2010. The deal also gives the company greater flexibility in buying back term loans, establishing a new receivables financing facility and making modification offers to holders of existing debt tranches. In February, CB Richard Ellis reported that its fourth-quarter net income sank 95%, hurt by weak sales and leasing activity. Revenue dropped 30%. A month later, Standard & Poor's Ratings Services cut its ratings on CB Richard Ellis a notch further into junk. In after-hours trading, the company's shares were down 2.3% at $2.93. The shares are off nearly 90% from their 52-week high. -By Jay Miller, Dow Jones Newswires; 201-938-2331; jay.miller@dowjones.com

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