Lowell - same story

All,

Please find our updated analysis here. 

Updated for Q3 numbers. No change in conclusion.

I.e.: The company should be able to achieve sustainable positive NCF if it really tried. But it does not try, because that wouldn’t drive Permira’s equity option fast enough. Instead it just ages its ERC book, drones on its Cash EBITDA leverage stats and the yield starved bond market buys it. Chances are it will refinance just fine, but we’d rather not be taken for a ride by Permira. Moreover on the downside lurks the threat of being layered by an Arrow-esque bond fund, more ABS or another innovative structure (porous bond documentation).

Wolfgang