Vivion - comment

After our update on Vivion last week, we have adjusted our DCF model resulting in a still manageable 60% LTV.

In a year, Vivion will have to deal with the entire €1.5bn bond stack and an amend and extend is the most obvious solution. In the same vein as Stada late last year, some cash could be offered to bondholders in exchange for pushing maturities out by two to three years.

Our thesis on Vivion, therefore, remains a refinancing with some cash into new instruments that will probably trade below (if nearer to) par. Crucially, Vivion has the cash to sweeten such a sour deal.

Better cash flow wouldn’t hurt.