OHLA - comment
Positive news for OHLA as the agreements are close to falling into place for tomorrow’s EGM. The €50m gap in the equity raise is still a hurdle and may come from a mixture of existing shareholders and a convertible. We expect the EGM to approve the capital raise, as the alternative is an administration. As always with OHLA, the company has gone to the wire, and the result is messier than needed, but we expect the plan to be approved by shareholders.
In summary
- Bondholders: Only 33% are signed up so far for the extension to 2029 at a 10% coupon (including PIK), but we expect approval will be obtained. This is effectively an Amend and Extend, 50% repayment (the 2025) tranche and an extension of three years at a similar coupon, with no reduction in nominal capital. The alternative is to bring the whole edifice crashing down and take control of a company in a liquidity crisis.
- Equity: €100m of the €150m planned has been raised. The José Elías consortium is providing €50m, the Amodio family €26m, Andrés Holzer €25m. This leaves a €50m gap to be raised from the existing shareholders. A convertible bond is now being proposed.
- Convertible: Up to €50m is required, and a six-year convertible is now being considered by the various groups participating in the equity raise. All the new equity investors will need to participate, as this note would be a dilution risk for non-participants. The conversion price will also be close to the equity raise price. A convertible will require board approval. Some cash may come in from existing small shareholders, reducing the convertible size, but we expect this would be very small.
- Bank Lines: The banks chose to reduce their guarantee lines, and as they were pushing for €150m of equity, their negotiating position is now weaker. However, OHLA will not want to re-open this discussion.