Centro Properties Group (ASX:CNP) shares spiked today when the company announced that it would consider putting itself up for sale after it was approached by several parties interested in its business. The Australian shopping mall owner invited potential suitors to make pitches as its board evaluates all options, including a sale of the company. Shareholders are hoping that the company will take action to unlock value and jump the stock’s share price, which had declined 89 percent in 2007.

Centro owns about 810 properties in Australia, New Zealand, and the U.S. and had planned to pay off its short-term loans by selling long-term debt on the commercial mortgage-backed securities market through attractive terms. However, the recent crisis has caused borrowing costs to rise and asset-backed securities to fall forcing the company to get a two-month extension from its creditors. This led to a substantial drop in the company’s share price as many investors question its integrity going forward.

Then, Centro shares dropped 76 percent on December 17th after the company cut its earnings forecast by 14 percent, suspended its first-half dividend and said it may have to sell properties as part of a restructuring to pay back debt. Given the recent popularity of mall properties around the world, this move prompted many interested parties to contact the company seeking more information on these asset sales.

“In recent days, we have received a significant number of unsolicited expressions of interest from a large range of strategic and financial investors in potential investments in the group and certain of our assets,” said Brian Healey, Chairman of Centro. “Therefore, as part of the strategic review process, Centro is now seeking expressions of interest for key alternatives available to it.

Centro is now requesting expressions of interest for two different scenarios. The first is a review of the company as a whole, including a recapitalization, equity issuance or acquisition. The second is interest in its Australian and U.S. wholesale funds, which reportedly account for a substantial portion of the interest they received. This announcement sent shares dramatically higher today, but many are quick to point out that the parties are mostly interested in purchasing the company’s assets not equity. So, it’s difficult to say how much the stock is worth. Regardless, this is definitely a stock worth watching!

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