Vivion - comment

The Muddy Waters report this morning is falling on fertile ground and has sent the bonds down almost 20 points. From our perspective, the biggest allegation is that the UK OpCos could be engineering artificially high rent in their (disclosed) related party structure. We have previously looked into this angle. Otherwise, Vivion’s setup has been to make enough CF to pay for itself and to otherwise make money from Fair Value Gains. It won’t have escaped anyone’s attention that these gains have not entirely materialised recently. Everyone in the space has dropped 30%. At first glance therefore the report feels a little light, but we will explore in more detail.