We have done well with our current positioning, but as Antolin’s optionality increases, we must be mindful not to linger. We have therefore reassessed the company’s LME potential and restructuring scenarios, and what our new position should look like. In the process, we have identified two additional events we expect this year, which in turn dictate our risk assessment and timing.
Bond recovery so far stands at 71c/€, up from our €40c/€ entry price. We have assessed the performance of HSE 24 operationally and how this has been reflected in the valuation of the SSN and PIK instruments to conclude our view on how best to position ourselves in the debt stack. This decision has been made easier by a comparison to HSE’s pre-restructuring trading levels.
We have assessed the upcoming vote on a domination agreement and subsequent A&E and how this should impact our immediate and future positioning. To do so, we have analysed the sales made by Branick and VIB, the level of impairment charges, and how this aligns with our appraisal of the portfolio. But there are risks to our assessment, and we will monitor if Branicks can ameliorate them.
With the strategic review barely a week old, how do those lofty goals compare to the cold reality of Intrum’s performance so far, and what has changed, if anything? Having rechecked our math, we found ourselves surprised by a trend that had been going on since 2024, but that we had so far dismissed. It is now clearer to us why this trend is persisting, and even if it is not yet enough to justify a certain position, it does have us thinking about it.
Sarria | Ubisoft Client Call - Thu, 5 February, 3 pm UK time | 10 am EST. For more information, please contact info@sarria.co.uk.
Ubisoft was a very interesting request. We have had to learn a lot about the gaming industry, where the value lies, and why. With that understanding, we have valued the company on a sum of the parts basis and projected its cashflows. But this is not a situation where the precise value plays a role. This name is all about liquidity and game theory. It was fun to play th
Our credit analysis focuses on the growing disconnect between operational progress and an increasingly fragile capital structure. We have incorporated management’s efforts to extract costs and invest in reorganising the business. Weak end-market volumes and ongoing restructuring cash outflows are placing sustained pressure on liquidity. We have projected our model to 2028 and concentrated on the creditor dynamics that will emerge as the dominant driver of value.
Our assessment is rooted in the view that further balance-sheet intervention is likely. We consider the differing creditor positions across the capital structure and how they hold increasingly asymmetric risk as maturities approach.
We have analysed where OHLA is post the restructuring/recapitalisation, alongside where its SSNs are priced and how this should impact our investment positioning. Our evaluation looked OHLA’s markets and the structure of proposed asset sales to decide whether or not the SSNs would be trending to par.
We have been long and wrong Atalian for over a year, and have reviewed our expectations for the next quarter to advise our investment stance. We have measured operational performance since the A&E vs our expectations to come to an updated valuation for the bond vs both our original analysis and current market value. We have also addressed potential events that could
As we enter the new year, we have reassessed the risks and opportunities across the Heimstaden structure, building on our prior work modelling the Company’s capacity to pay dividends. Updated operational data and revised assumptions allow us to evaluate the Company’s own valuation assessment in detail. As with all real estate companies, our investment thesis continues to be driven by views on asset coverage and cash flow generation, with recent capital market issuances informing these assessments.
We assess where Synthomer sits within the chemical industry, how its businesses should be valued and scrutinise its capital structure, to express our conviction. Considering the maturity of the company, we address the split between Speciality and Basic products and provide a valuation for the SUNs based on both the Sum of the Parts and DCF.
Sarria | Synthomer Client Call - Thu, 22 January, 3 pm UK time | 10 am EST. For more information, please contact info@sarria.co.uk.
Having hit a new groove in the forecasting of its various business segments, we have been tracking and modelling the company in great detail. Numerically, the Q325 update has not been groundbreaking. But more recently, the bet has simplified dramatically, and we reflect that by significantly altering our shadow portfolio allocation.
We see limited upside across the capital structure, reflecting the ongoing weakness in the chemical market and the likelihood of a further delay in any cyclical recovery. The 2027 bonds currently trade at approximately c 20pt premium to the longer-dated issues and we would expect some flattening of the curve over time, implying a higher downside risk for the 2027s.
That said, the 2027 bonds are likely to retain a degree of relative support given the need for Ineos to pursue either a refinancing or an amend-and-extend transaction. Despite the group’s sizeable cash balances, we believe it would be imprudent to deploy a material portion of available liquidity to repay the 2027 maturity outright, making a refinancing or amend-and-extend the more probable outcome.
Sarria | Ineos Quattro - Client Call Wed, 14 January, 3 pm UK time | 10 am EST. For more information, please contact info@sarria.co.uk.
Having been in the weeds of this name since 2021, this update had us notice again how far Adler has come since. Still, the name remains complex, and we continue analysing those development assets individually to gauge the outlook for the next two years. That said, the main drivers of return are increasingly shifting, particularly for the 2Ls.
Following a successful trade in Pasubio’s bonds earlier this year, we have revisited Pasubio to seek further trading opportunities. We have assessed the options available to PAI for further acquisitions within the structural constraints of the bonds. Using these insights, we have updated our analysis post Q3 results, incorporating management commentary on pricing contracts. While the sponsor explores a pivot towards the luxury leather segment, our credit investment stance remains guided by the core automotive business, which underpins short- to medium-term performance.
By this time we would have expected management to chamnge its mind about a constraint we keep hearing from Mobico, but in our most recent conversation this week the constraint continues to play a very central role in management’s thinking, despite receiving advice on the issue. As a result we will return to the drawing board to assess if our present strategy needs adaptation. Updates on the underlying businesses only confirmed our present understanding.
We have updated our analysis following BioGroup’s Q3 results, refining our view of performance across the capital structure and identifying several potential trading opportunities. Our assessment leverages the extensive comparative work we previously conducted on Cerba, while recognising the distinct dynamics at play for BioGroup, including its differing leverage profile and the additional strategic options available to the Company. However, the outlook is influenced by the evolving landscape of French tariff expectations. Combining these forces into our analysis, we arrive at our overall investment assessment.
We have been familiar with this name for well over a decade now and yet, the gift keeps on giving. UK consumer discretionary credits have generally had a rough time in this period, but folowing a series of setbacks, the focus of this analysis has shifted yet again. We have examined the usual: company (largely unchanged), sector, financials, profitability, liquidity and cashflows, valuation, etc. All is running as expected, except one of those parameters is undergoing a profound change and another isn’t changing with it. That’s the foundation for our thesis.
We have updated our investment stance in view of the recent Q3 Trading Statement and the various capital market issues in October and December. Our analysis addresses the current valuation of assets, how this may develop over the coming quarters, and also investigates the sustainability of the capital structure in light of rental yields, SUNs yields and the potential impact of rating changes.
With the bonds now extended, we have revisited Graanul following its Q3 results, anchoring our analysis on the range of achievable EBITDA and cash flow levels for FY27 and beyond. Our work assesses how evolving industry dynamics, particularly shifts in wood-pellet manufacturing capacity, prospective demand growth, and the resulting implications for margins and pricing, may reshape the Company’s outlook. We also incorporate the potential effects of the UK government’s Heads of Terms agreement with Drax, alongside broader market factors such as tariffs. Drawing on a suite of forward-looking scenarios, we evaluate how these variables interact to inform our overall investment framework.
Rights Issues, asset sales, constellation CapEx, CapEx constellations, contract wins and cancellations, defence exposure, ageing cash cows and rising stars - the list goes on, and Eutelsat has it all. So, considering its legal structure and bond curve, is there an opportunity for us in the near term? We have updated our trusted two-entity model here, sum-of-the-parts analysis and value waterfall to come to a conclusion.