B&B unit in trading halt

Shares in Babcock & Brown Communities, the listed retirement home fund controlled by Babcock & Brown, went into a trading halt this morning ahead of an announcement about its strategic review.

"BBC is requesting a trading halt as the BBC Board is finalising its response to the previously announced strategic review," the company said in its release to the Australian Securities Exchange.

"The BBC board expects various agreements to be concluded with Babcock & Brown and, upon finalisation of its strategic review, BBC will announce the terms of the agreements in relations to its preferred options."

The company said in June that it had hired an independent adviser to look at ways to increase the share price at the company, which has lost 63% of its value since the beginning of the year.

Babcock & Brown Communities' gearing ratio of 32% is less than half of beleaguered parent Babcock & Brown's, which is almost has nearly the three dollars of debt for every four dollars of assets.

Shares in Babcock & Brown Communities closed down 1.4% yesterday, or half a cent, to 34.5 cents yesterday.

Changes at Babcock & Brown Communities, which runs 56 retirement villages and 29 aged-care homes in Australia and New Zealand, come amid a broader restructuring unveiled by the parent company last week.

Babcock & Brown plans to move away from the structured finance business that has run up debts at Babcock's family of listed infrastructure funds and created a crisis of confidence among investors.

Concerns about Babcock & Brown's viability ultimately claimed chief executive Phil Green last week.

Mr Green was replaced by chief financial officer Michael Larkin, who is overseeing Babcock & Brown return to its core businesses of leasing, real estate and infrastructure.

Babcock & Brown's shares fell as low as 3%, or 8 cents, to $2.53 in early trade. The company's stock is down 90% for the year according to data from Bloomberg.

Shares in Babcock & Brown Communities will remain in a halt until Friday morning or until the expected announcement.