Financing Talks
Andrew Backman, a spokesman for New York-based IStar, declined to comment.
Investors have embraced high-yield, high-risk debt as the Federal Reserve has held interest rates at record lows to stimulate the economy. The extra yield investors demand to own the bonds rather than Treasuries has shrunk to 5.75 percentage points from 21.82 percentage points in December 2008, Bank of America Merrill Lynch index data show.
Financing talks with bondholders, banks and other potential investors are preliminary, said the people, and specifics about the size of the package or interest rates haven’t been determined. Any final deal is likely at least months away, according to the people.
Loomis Sayles & Co., another IStar bondholder, and H/2 Capital Partners, the investment firm run by former IStar executive Spencer Haber, are working with Franklin on the potential debt exchange and financing, according to the people. They are being advised by Milbank, Tweed, Hadley & McCloy LLP, the people said. IStar is looking to exchange existing debt for new securities with a longer maturity, the people said.
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