Pro-Gest more positive, but still binary

All,

Even if a positive resolution has become somewhat more likely before the political back-drop of regional elections in the summer, the situation remains binary and thus not very attractive from our perspective.

Pro-Gest on Friday evening announced that the Regional Administrative Court of Lazio granted the company a new 30-day deadline to provide the Italian Competition Authority with a suitable guarantee for its claims arising from the fine. If the company can provide such guarantee within 30 days the Authority will suspend the payment of fines until the date of the hearing on 8th of July.

Simultaneously - and in the same context - Pro-Gest announced it called bondholder meetings for the 2023 5.25%s one 4.25%s  for Feb. 26th, which are necessary to accommodate the above mentioned guarantee for the competition authority.:

a) relaxing financial covenants

b) 5.25%s: push back amortisation and move maturity forward to 2022. 

c) 4.24%s: relax covenants around the granting of new guarantees.

d) include a put option for bondholders from March 31st 2020 onwards

e) entitle the company to redeem the bonds at any time

f) limit transferability

While these meetings are of course important to allow the company to conserve its liquidity through the negotiations, the overall fait of the company and bondholders still rests on the outcome of its environmental application for the cartere in Montova, for which tests have recommenced and which should be concluded in the coming weeks. 

Wolfgang