Mills Corp. SEC Filing Gives Insight Into Sale, Xanadu
Mills Corp., in an SEC filing Thursday, “offered new details on the looming
debt and liquidity problems,” on the Xanadu project at the Meadowlands,
and on its efforts to find a buyer, according to Terence O’Hara of the WASHINGTON
POST. The company borrowed almost $2B in May “to give it enough cash to
keep building several projects,” but the loan “came with a requirement
that Mills find a buyer by the end of the year, a prospect that isn’t assured,
or Mills will go into default.” Mills said that the “uncertainty is
what will lead auditors Ernst & Young to issue a ‘going concern’
letter,” which “alerts investors that the company might not be able
to survive,” when it reports overdue results next month. In addition, the
construction budget for Xanadu has increased to $2B from $1.3B, and because space
“hasn’t leased as well or as fast as Mills hoped, banks aren’t
willing to finance its construction.” If Mills does not get a lender, it
will “have to finance the construction itself, a prospect that could substantially
reduce the company’s investment value” (WASHINGTON
POST, 8/11).
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