Pro-Gest - Power plant starting up
All,
Please refer to our unchanged analysis here.
Pro-Gest have started up the power plant of the Mantova mill, the latest sign that production is ultimately due to begin. The plant will likely take through the end of the month to produce the steam needed to operate the containerboard machine. So a start of the actual mill would come mid-November at the earliest, if not in December. Commercially viable aper should therefore take another 2-3 weeks to produce and we estimate will only add to quantifiable sales in the new year.
Meanwhile, discussions with investors on the refinancing of Pro-Gest’s collection of structurally sr. financings have reportedly resumed with runners circulating that a new facility would also be placed at Holdco level. That would be great progress for the company. However, we find the idea that such debt would be ranking pari passu with the bonds a step too far.
We are holding on to our position (now near 6% of NAV) in the bonds even as this final start-up process is taking longer than advertised.
Wolfgang
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E: wfelix@sarria.co.uk
T: +44 203 744 7003