Barratt denies media reports that it has debts close to 拢2bn, which must be reduced to meeting banking obligations
Barratt Developments has dismissed a report in the Observer that it is at risk of breaching its banking covenants..
The story claimed the housebuilder has debts approaching 拢2bn and needs to reduce the figure by 拢100m in order not to break its contractual obligations with the banks.
A Barratt spokesman said: 鈥淭he company does not understand the story in the light of its recent trading update. Ahead of our interim results we cannot go into the details but our update made it clear that we were operating well within our facilities.
鈥淲e also made it clear that we are still spending 拢1.2bn on land in the current financial year, which is a significant commitment.鈥�
Barratt borrowed heavily after it bought housebuilder Wilson Bowden for 拢2.2bn last April, before the credit crunch caused house prices to fall.
Its order book at the half-year ended 31 December 2007 stood at 拢1.26bn, nearly 6% down on a year ago.
At the end of November, the company said that sales of the company's houses and flats had fallen 14% since the summer as lenders held back in the wake of the Northern Rock crisis.
At lunch shares had risen 24.5p to 394.5p.
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