Allan Saunderson is managing editor of Property Finance Europe and a contributor to GlobeSt.com.

BARCELONA, SPAIN-Spain's struggling listed group Inmobiliaria Colonial has been forced to return to the negotiating table with its bank syndicate exactly one year after closing a refinancing agreement. The issue is that cash-flow is adequate to support debt of €2 billion while liabilities total €6.3 billion.

If current talks lead to an agreement, the company's 10 syndicated bank debtors would end up with close to 90% of equity, according to media reports and PIE sources.

Since the beginning of the summer Colonial has been immersed in the refinancing process on which it is being advised by Lazard. Of its total debt, €4.2 billion is owed to the syndicated loan group. The coordinators are Royal Bank of Scotland, Calyon, Eurohypo and Goldman Sachs, while other syndicated entities are ING, Caja Madrid, BBVA, Banco de Valencia, Post Bank and La Kutxa. An agreement would mean that the two Spanish Banks, La Caixa and Banco Popular, would lose their controlling status over Colonial.