Rallye - comment

Rallye announced a tender for €247m of unsecured Rallye debt at 15%. Rallye is using the unused balance of February 2021 tender facility provided by Fimalac. The arranged facility was originally for €82m face, with €40m used in Q1 21 to fund the tender at 20% of face. The availability of this facility expires in June 2022.

There is an air of desperation around this tender. With the share price languishing at €16, the secured debt is significantly under-secured. The share price would need to be c.€28 for the secured debt to be whole. This tender is for unsecured, which are significantly out of the money. In addition, the tender is only for €247m versus an outstanding amount of non-senior secured debt of €1,670m (c.15% of outstanding debt). A successful tender reduces the outstanding debt but still leaves Rallye equity and Noouri’s value substantially out of the money.

At current share price of Casino, we are likely to take the liquidity and tender our unsecured Rallye bonds. We will make a decision shortly.