Noel Smyth: company is offering to buy back some of its bonds at discounts of up to 84% of face value

NOEL Smyth's property investment company Alburn will offer bondholders a stake in part of its portfolio if they agree to sell back their debt at a sharp discount.

As revealed by the Sunday Tribune in October, Alburn is offering to buy back some of its bonds at discounts of up to 84% of their face value. Several of the investors in the property vehicle's debt have objected to the price and are threatening to scupper the deal, which must be voted on later this week.

In a bid to sweeten his offer, Smyth and his partner in the debt buyback – property investment company Highcross – said if the bondholders don't want to sell their debt for cash they will be able to exchange it for an "equity interest" in the company being set up by Alburn and Highcross.

The bondholders will meet tomorrow in London to get an update on the Alburn properties' performance by Rothschild and CB Richard Ellis. The investors now have until Friday to vote on the offer.

The 45-strong Alburn portfolio includes offices, retail and industrial space let to clients including DHL, BT, Premier Foods and a number of UK government departments and agencies. The properties were worth €288m in 2007 but an updated valuation of them in April this year put their worth at just under €156m, a drop of nearly 53%. The properties are generating rental income of about €16.8m.