Takko - Coupon or Communication

All,

Takko pay coupon on the 15th of May, which this year is a Saturday - tomorrow. As per previous emails, we are sceptical about the company’s ability to make that payment and are expecting a letter instead with wording about grace periods and advanced negotiations.

German Lockdown:

German reinfection rates are falling and the country as a whole has just passed under the magic mark of 100. Arithmetically that suggests that half the country’s counties should be open for business/retail by the end of next week and then likely more openings thereafter. We had expected slower progress, so this could be good for Takko relative to our projections.

Limited cash need in the short term:

In the scheme of things, we think that in the short term a limited amount of cash might be sufficient to test Takko’s sales recovery before more may be needed to cover the next WC peaks. So a similar manoeuvre as last year may serve before stakeholders are willing to bite the bullet and test Germany’s new restructuring law.

We may be wrong and the coupon arrives as planned, but we think it’s worth double with back-office on Monday. We remain short the bonds for 5% of NAV.

Happy to discuss,


Wolfgang
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E: wfelix@sarria.co.uk
T: +44 203 744 7003

www.sarria.co.uk

Wolfgang FelixTAKKO