Sectors > Top Reports > Kloeckner Pentaplast Memo 091219

Kloeckner Pentaplast Memo 091219

Kloeckner Pentaplast. Value, Defensive Play. Finding The Optimal Position In The Capital Structure
PUBLISHED: 09 December 2019
PAGES: 169
SUBMARKET: Kloeckner Pentaplast, Top Reports, Top Reports,


Why Read?

  • Understand Q3 / 9m 2019 performance
  • Understand the business and its key drivers – exposure to raw material costs, in particular to polymer prices
  • Industry overview – main private and public competitors and comparative financial and operational performance 
  • Understand the acquisition of LINPAC in 2017 – rationale, expectations and integration developments
  • Understand the main historic corporate events with a focus on the 2017 refinancing, when the Term Loans (TL), RCF and PIK-Toggle Notes were issued
  • Understand the capital structure and the TL, RCF and PIK-Toggle Notes debt instruments
  • Historic financial analysis from 2014
  • Understand the relationship between pricing of the debt instruments and the prices of raw materials with detailed market analysis on the main polymers
  • Base and bear case forecasts to understand liquidity and refinancing risks in plausible scenarios
  • Detailed DCF, trading comparables and comparable transactions valuations
  • Recovery rate analysis for TL and PIK-Toggle Notes
  • Return analysis considerations on a possible investment

What’s New?

  • Detailed liquidity (and full financial) analysis with sensitivities to: revenue & EBITDA contraction potential; shocks to days payable outstanding (DPO), days sales outstanding (DSO) and days inventory outstanding (DIO)
  • Plastic packaging M&A transactions and EV / EBITDA multiples
  • Detailed valuation analysis – DCF, peer multiples and M&A transactions
  • Estimation of cash flow sweep impacting ability of PIK-Toggle Notes to receive cash vs PIK coupons

Questions Answered

  • Under what circumstances would the Term Loans and PIK-Toggle Notes experience loss relative to today’s prices?
  • What is the EBITDA potential of the business?
  • How big is the equity cushion in our base and bear cases and across a range of valuation methodologies?
  • How does Kloeckner Pentaplast’s financial performance compare with competitors and peers? 
  • How are key polymer prices developing and what is our outlook for these?

  1. View, Variant Perception & Recommendation

  2. Business Overview

  3. Industry Overview

  4. M&A - LINPAC Acquisition

  5. Historic Financial Analysis

  6. Group Structure & Capitalization

  7. Trading Update - Earnings Release Q2 2019

  8. Trading Update - Earnings Release Q3 2019

  9. Base Case Forecasts

  10. Bear Case Forecasts

  11. Valuation - Comparable Transactions

  12. Restructuring

  13. Investment Considerations


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