Rallye - comment

So on to the next stage. The Paris Commercial Court has approved Rallye’s unsecured debt tender with the settlement agreed for May 16th. It was deemed a mere formality and confirms the reduction of €242m of unsecured debt.

This transaction has increased Rallye’s secured debt to c. €1.6bn, with a break-even equity price currently of c.€28. Although this transaction has reduced the overall debt burden at Rallye, ultimately, the equity value at Euris remains significantly out of the money. We expect further financial transactions as Naouri tries to secure equity value at Rallye and Euris. The simplest way to achieve this is deleveraging Casino via asset sales but this however creates value for the Rallye sub bonds, which still total c.€1.4bn.