Pepco and the Liquidation Application
All,
Please find our unchanged analysis here.
Today one event was about Steinhoff's assets and the other about its liabilities. Neither event was particularly positive but in the scheme of things we are comfortable with both.
Pepco:
If Pepco’s life at the Warsaw Stock Exchange has begun with an uninspiring +10% to IPO price, it is at least partially a structural problem as investors are concerned any significant premium will lead to Steinhoff dumping more shares onto the market. We would have liked to see a bigger bounce to cement the valuation for our SFH positions, but
Liquidation Application:
- Even though the SA High Court should not have jurisdiction over SIHNV, it has accepted the application and set a date for the hearing on the 3rd of September. We had brashly assumed the court would reject the application on the very grounds that it has no jurisdiction. But the political environment in the country probably does not allow even the High Court to reject such a visible challenge.
- The date in September will likely delay at least the SA leg of the process even further and of course, the entire application is mostly designed to thwart the Grand Settlement scheme on which we are counting.
- Given the limited size of the Tekkie Town claimants in the scheme of things, however, we think that unless SIHNV wins the day in September outright, a settlement will be found that won’t make the world of difference to Steinhoff creditors at large. So we remain relaxed.
We remain positioned with 5% each in the Luxfinco 1 A1s and A2s.
Happy to discuss,
Wolfgang
___________________
E: wfelix@sarria.co.uk
T: +44 203 744 7003