Intralot - Conclusions from the Call

All,

Outcome of the Intralot bondholder call (here):

Equity to remain in control:

1) All sides recognise the value destruction that would come from a formal Greek process.

2) All sides recognise the value in a silent process, given the contract nature of the business.

=> So the starting position is - as expected - an EV less (some) equity value approach and no (visible) change of control.

Blocking minority:

3) The 24s have a 25%+ blocking minority in the 21s. Thus a near par cash+security package is unlikely. Even security for fresh cash package seems remote, as the company is swimming in cash already. If it forms part of renewed commitments (possible) then its not likely anymore that only the 21s would be invited. 

4) Company engagement with only a few large bondholders or otherwise selective approach remains risk to bondholders.

5) Equity and company ready to engage, but willing to drive the process all the way to the wall to squeeze bonds lower. Looking to realise market discounts with large cash balance.

=> Perella are therefore looking to form a group of 21s and 24s together.

Conclusions:

- Perella sounded well on the ball - have understood the principal issues, but

- 21s and 24s have to fight it out among themselves before being able to have any coordinated approach / conversation with the company. Not sure how Perella will try to organise that stand-off from a unified position to begin with.

Wolfgang