NEW YORK, April 15 (Reuters) - Credit default swaps insuring the debt of The Rouse Company, a unit of General Growth Properties Inc GGP.N, were found to be worth 29.25 percent of the debt they insure in an auction on Wednesday to determine the contracts' value, auction administrators said.
That means that sellers of protection will need to pay out 70.75 percent of the value of the bonds they insured, or $7.07 million per $10 million of insurance sold. Credit default swaps are used to insure against a borrower defaulting.
Payments on the contracts were triggered after the company failed to pay more than $2 billion in debt due on March 16.
A group of General Growth's bondholders have asked their trustee to sue the mall owner for payment on their past-due bonds, The Wall Street Journal reported on Monday. For details, see [ID:nN13392097..
Norton's note: GGP.N who owns the Maine Mall has filed ch 11 bankrupcy April 16, 2009. Ouch!
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