VALUE6 May 2021 12:19
Potential Value
- we know equity in pot at IPO: NA
- we know equity raised recently - £52.5MM (~EUR 61MM)
- we know transaction value: $262.2MM or EUR 220 MM (base offer) + $194.5 MM (defered with trigger)
-We know costs: BOND 1: 90 MM EUR @ 8.75%, Nov 24 maturation to replace incumbent + BOND 2: 60 Mm EUR @ 9.15%, maturing in May 26.. so;
total raise: 211 MM EUR (EUR 150 MM from bonds and EUR 61 MM from recent equity raise)
transaction cost: EUR 220 MM minus capital adjustment* (Net ~EUR 200MM)
*expected annual FCF in 2021: 22 MM EUR (BTAX) @ CPR EUR4.28/MCF gas price assumed, its higher than that. so expect circa EUR 40MM FCF pretax by YE 2021. based on economic date vs completion, i expect EUR 15-20MM capital adjustment to KIST. *
- total costs of funding:
--- Bond 1: (EUR 90MM + EUR23.625MM) + Bond 2: (EUR 60MM + 27.45MM) = EUR 201MM
- All pretax: valuation (nominal) on reserves & risked contingent resources (nominal) for TONO [~EUR 2B total] – see CPR tables.
huge upside. My expected net sp circa £2.26-£3.73 post closing (a bit more work to tighten spread, I considered only base, no contingent here)