Aggregate - comment

Aggregate have extricated themselves from the VIC situation clean. Developer gives up 100% of shares in the Portuguese business and in return benefits from the release of its guarantee of the now near €400m convertible bonds and can hold on to its proceeds from QH Track. The deal lead by Owl Creek, Albacore and Mudrick allows for the continuation of development activities on the Portuguese assets, which requires fresh cash. It earns Aggregate a € and a 5% equity participation on distributions in excess of €1bn, which seems some way out of the money at the moment, but perhaps not out of reach in the long term. In sum, the deal amounts to a huge simplification at Aggregate, which is positive on the whole. Going forward, we expect the developer to write off the over €1bn of goodwill on the transaction, accounts in May (which may not yet reflect the transaction) and ultimately an approach to the bonds with a proposal.