Atalian - comment
We had expected the formal announcement of an equity injection for Atalian along with the 1H22 results today, but Atalian has gone one step further. C&R is acquiring the entire business with a completion target of the end of 2022. On completion, Atalian will buy back its bonds. The 2024 bonds are callable at par, but the 2025 and 2026 bonds are currently callable at 101.7/101.3 respectively (both falling to par in May 23). Given there are still execution risks, the bonds will trade at a small discount to their call prices. How CD&R intends to capitalise the business has not been announced, but a merger of Atalian/OCS does seem likely. We will look to put more meat on the bone of the announcement after this afternoon’s results call from Atalian.
- CD&R’s binding offer to shareholders will be subject to the usual regulatory approvals and the completion of the acquisition of OCS Group in the UK. A joint price of £2.5bn has been mentioned weighed towards Atalian. The French group has its H122 call at 3 pm CET today, the results/presentation are likely to be out at lunchtime.