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Anyone looked at INTU?

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Fallen Angel avatar
(@fallen-angel)
Posts: 2
New Member
Topic starter
 

Has anyone looked at INTU's secured group structure, Intu (SGS) Finance plc?

This has £1.150m of notes outstanding and about £130m term loan on the Loan Facility.This was 57% LTV end 2018 and we will get new LTV for end 2019 soon. Value has to be (much) lower and LTV will thus probably be much higher, but debt is currently trading at around 50% of face value.

 

So debt is:

£1.150m FV notes at 50% =          £575m

£   130m FV Term Land at 100% = £130m

Total FV debt                                £705m

 

In their LTV covenant test end June 2019, the Value of the collateral was set at £2.332 and their annual EBITDA was £118m. This is a cap rate of 5%. In my opinion this is too high and given COVID-19 and the effect on retail this has to come down. Which will push INTU into breaking their covenants, which they already said they would.

 

INTU just published their anticipated Cash Flow Projections and SGS has the following profile:

NRI                                            £79.4m

OPEX                                         £22.8m

CAPEX                                       £10.7m

Op. CF                                       £45.9m

Interest                                     £38.2m

FCF                                           £. 7.7m

 

So clearly the equity is toast and the interest costs are barely covered. Based on a cap rate of 8% on the £45.9m operating income, I get a value of £574m. So basically exactly in line with the current valuation of the notes (but there is still a term loan).

 

So probably this is currently valued by the market on the following assumptions:

 

Equity is zero

Notes will become new equity

Term Loan will be rolled over

With the term loan getting a 5% interest rate and thus £6.5m of annual interest, the new equity can get £45.9m - £6.5m = £39.4m of annual dividend. Based on a £575m investment, this is a return of 6.9%.

 

In my opinion not interesting (enough) to warrant the effort.

 

 

Let me know what you think.

 

Best,

 

Sjoerd

 

 

 
Posted : 12/06/2020 3:10 pm
CC70 avatar
(@cc70)
Posts: 1
New Member
 

Intu - we're active across the stack and publish on the situation regularly

INTULN 8¾   23 47 - 48 5000x (Metrocentre)
INTULN 9     24 48 - 49.5 5000x (SGS)
INTULN 5.562 27 33 - 36 (Debenture)
INTULN 9     28 48 - 49.5 5000x (SGS)
INTULN 9     30 48 - 49.5 5000x (SGS)

 
Posted : 15/06/2023 9:51 am
Slogger avatar
(@edwisealpha-com)
Posts: 5
Active Member Admin
 

Intu Update

SGS INTU announced yesterday that Mr Justice Zacaroli, sitting in the High Court on 11 April sanctioned the proposed Scheme of Arrangement "substantially in the form tabled at, and approved by, the Scheme Creditors at the Scheme Meeting which took place on 8 April 2024." As a result the Scheme Effective Date has occurred on 11 April 2024.

As part of the recapitalization, the outstanding Super Senior Money, totaling €24.5m (including interest), will be repaid.

  • Lenders participating in the Initial Term Loan Facility and the three notes will receive a cash payment covering a portion of the total amounts, including PIK outstanding.
  • Any remaining debt of these lenders will be fully satisfied through an exchange for limited recourse Holdco-level PIK instruments and equity.
  • In cases where a creditor cannot hold equity, alternative upside instruments (AUIs) with similar governance controls within the SGS Group will be provided.
  • The new Holdco PIK will have a nominal amount of around £1.3Bln, accompanied by equity stapled to it, a 20-year maturity, and will pay 10% PIK annually.
  • These notes will be listed on The International Stock Exchange (Channel Islands) but will operate under a private information-sharing and transfer regime.
 
Posted : 15/04/2024 6:43 pm

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