UPDATE 1-iStar Financial arranges nearly $3 bln financing
* To use part of proceeds to repay debt maturing in 2011, 2012
* $2.95 bln credit agreement made up of two term loans (Follows alerts)
March 17 (Reuters) - Commercial real estate lender iStar Financial Inc , which in February said that a lack of new credit lines could hurt its ability to continue as a going concern, has arranged nearly $3 billion in financing to help it pay down debt maturing this year and the next.
New York-based iStar, which had $7.35 billion in debt obligations as of Dec. 31, said it would use part of the proceeds from the two tranches of term loans -- a $1.50 billion tranche due 2013 and a $1.45 billion tranche due 2014 -- to repay debt maturing in June 2011 and 2012.
The company had almost $3.2 billion of debt due in the first half of 2011, and had been selling assets to repay debt and meet its short-term liquidity needs.
The company said the debt under the new financing will be secured by a first lien on a fixed pool of about $3.69 billion of assets.
In September, Fitch Ratings downgraded most of its credit ratings for iStar to low "junk" grades, citing $2.2 billion of debt coming due in the second quarter of this year.
iStar shares closed at $9.06 on Thursday on the New York Stock Exchange. (Reporting by Tenzin Dekeva in Bangalore; Editing by Maju Samuel)
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