Amara - comment

As per last Friday, we said it wouldn’t be long before the company needs fresh cash. Less than a week later, we understand that Amara have hired Houlihan & Lokey to handle the debt. The company creates no FCF to pay any interest at all, but bonds create the company at a mere €100m. The trouble is these days that when holders are concentrated, an uptier into First Out paper could significantly reduce recovery if, as in Lowell (not handled by HL), the roll-up specifies a significant minimum size hurdle. Otherwise, all bondholders are front, centre and aligned.