One way to buy back PXUPA would be for someone like Coastal (or another PE firm) to lend money to the PaperlinX in exchange for New Hybrid equity which has a higher ranking than PXUPA but lower than senior bank debt (assuming the PXUPA deed allows company to do this) with the expressed purpose of buying back PXUPA in the market upto an undisclosed price ceiling.
Of course, for anyone to lend an amount to the company it has to do due diligence on the company and be convinced of its future. Assuming that Due Diligence confirms viability, one condition Coastal or PE firm can impose is that there is mandatory payment of an agreed rate of interest by PaperlinX on New Hybrids unlike that on PXUPA, and they are possibly given an option to acquire a chunk of PPX shares in the future (say within two years) at a higher than current price of say 15-20c/share (which could be palatable to the current PPX holders).
This could be WIN-WIN for everyone! PPX shareholders will start to see an upward drift in the SP. For PXUPA holders there will be an opportunity to either get out now at higher than current market price or hold on with increased chances of getting $100/unit 2-3 years out. The company will see its balance sheet strengthened as PXUPA liability will go down having bought back some of these hybrids at large discount to the face value. Coastal or the PE firm will have increased liklihood of good profit from their PXUPA holding (if any) as well as increase in any share options they hold. The chance of a successful acquisition for PaperlinX would also be increased with reduced PXUPA overhang.
Something for Coastal or a PE firm worth thinking about, but it all depends on whether PPX as a going concerm is viable, which I believe it can be!
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