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Centro Properties Group, Australia’s second-largest shopping centre property company, has fallen victim to the US subprime credit crisis causing a plunge of more than 70 percent in share prices for the group. Centro's assets in the US Midwest have been in the areas hardest hit by the subprime crisis.

The group will need to refinance over $3 billion worth of debt due in the next year, while more than $10 billion beyond 2008 will also need to be reassessed. Shareholders will not receive a dividend for the December quarter. Centro may need to resort to a fire sale to sell some assets.
Centro's biggest shareholder is Colonial First State, subsidiary of the Commonwealth Bank, which holds 12.95 percent of the company's stock. A spokeswoman reported that Colonial held 85 percent of their stock in its own portfolios. The rest was held by other fund managers using the FirstChoice platform.
"These impacts are leading to earnings forecast downgrades but don't necessarily reflect on the underlying quality of the assets held by these companies," she said.

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