Sectors > Top Reports > Aldesa Memo 150519

Aldesa Memo 150519

Buy Senior Secured € 7.25% 2021 – c. 27% Yield. Money Good
PUBLISHED: 15 May 2019
PAGES: 44
PRODUCT CODE: ALDESA0001
SUBMARKET: Aldesa, Top Reports, Top Reports,

£1,470.00

Why Read?

  • Understand the background behind Aldesa’s difficult 2018 and the precipitous drop in bond price
  • Understand why Aldesa’s situation is different to the failed Astaldi and CMC Ravenna
  • Understand the distinction between Restricted Group and Unrestricted Group and the importance of zoning in on the Restricted Group
  • Understand valuation assumptions around the Unrestricted Group and its importance vis-a-vis the bond maturity
  • Understand the working capital cycle and how it impacts FCF generation
  • Understand catalysts and risks for the long thesis
  • Understand options available to the company in order to meet bond maturity
  • Understand Aldesa’s valuation sensitivity to working capital, new orders and cost of capital in terms of equity cushion and debt coverage
  • Understand the difference between recourse and non-recourse debt as it impacts Aldesa’s ability to meet its debt servicing obligations at the Restricted Group
  • Understand in detail the Concessions business within Aldesa

What’s New?

  • Valuation of assets within the Unrestricted Group and Concessions business, both using Aldesa’s high cost of equity but also from the perspective of potential infrastructure fund buyers
  • Valuation sensitivity analysis – understanding impact of working capital, new orders and cost of capital
  • Discounting the importance of consolidated numbers when assessing Aldesa’s ability to repay / refinance the bonds
  • Focusing on the Restricted Group metrics with potential for cash proceeds from asset sales within the Unrestricted Group

Questions Answered

  • What is our base case valuation of Aldesa and its key sensitivities?
  • Can Aldesa generate sufficient FCF to refinance / repay its bond maturity in 2021?
  • Where will Aldesa be in terms of liquidity when the RCF matures in 2020 and nearer the maturity of the bond in 2021?

  1. View, Variant Perception & Recommendations

  2. Business Overview

  3. Key Events

  4. Restricted Group

  5. Concessions

  6. Comparables

  7. Liquidity

  8. Valuation & Sensitivity Analysis

  9. Conclusion

Aldesa


OHL


Astaldi


CMC Ravenna


Strabag


Skanska


ACS


Sacyr


Eiffage


Royal BAM


Hochtief


 

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