Accentro - comment
Friday’s announcement of a €50m - €60m devaluation in properties is likely to be on the rental portfolio in eastern Germany. We have been sceptical about the valuation and why Accentro bought such stressed assets in the first place. Accentro also admitted that the write-down would cause the company to breach its bond LTV maintenance covenant. Bondholders and lenders may have the right to enforce, but as with the recent amend and extend operations, creditors have little option but to roll the dice as enforcement is likely to bring the house down on everybody.
Accentro has now commissioned a restructuring report (IDW S6). The banks will have demanded this report to assess Accentro's viability. It is independent and will force some reality into management thinking. Incidentally, an IDW S6 report is a requirement for a German Starug Plan restructuring, but can only be commissioned if the company is not already required to file for insolvency imminently, and the company still has liquidity.
https://www.schultze-braun.de/en/services/restructuring/restructuring-report