Steinhoff - Swapping position

All,

Please find our updated analysis and entity priority model here.

We are exchanging our position. We are selling our 4% of NAV position in the B2s and are buying the Lux Finco 1 21/22s. 

The Q2 numbers did not contain much news over the recent release of the proposed settlement. Instead our decision to change position follows our recent conclusions that the market is not pricing in a possible success of the grand settlement at all. 

We are more bullish than that - despite its complexity - and see a 15 point upside to the position from such an event. In case of failure of the settlement the bonds are trading at about fair value.

Happy to discuss,

Wolfgang