Takko - Onto the Shelf

All,

Please find our model of Takko here.

We have been following Takko in detail over the past years, through covid and now into its eventual restructuring. We have no doubt that the company will return to strength in the coming quarters and years - most likely within as little as 18 months. But due to the high concentration of bondholders, the name has become uninteresting to most of us. The only change we have made to our model is the Recap table on the first page, where we have reflected the agreed economics (no partial pay-down / conversion into RCF of the TLB and therefore bigger sub and €15m more equitisation).

If we felt there was enough paper available to credibly take a position in the bonds at 80c/€ we would put it in our portfolio, as most gross margin headwinds will cycle through over the next two seasons, leaving bondholders (future equity) in a very attractive position. But unless you ask us to maintain coverage of this name over the coming months, we are inclined to put it on the shelf for now.

It’s Takko, so I’m sure we’ll see it back soon enough.

Wolfgang

E: wfelix@sarria.co.uk
T: +44 203 744 7003
www.sarria.co.uk