Ann: Altech - Launch of German Project Equity Strategy, page-97

A few posts have referred to the '15% p.a. return', 'a de facto 15% bond' or 'convertible bond'.
I want to make it clear the 15% p.a. return is only a condition of the AAM sell-back.
Altech has control of the timing of the sell-back but AAM can veto it and keep their ownership.
If AMM decides to retain their up to 49% ownership then the 15% is NOT applicable.
If they want to sell out after 6 years (or less if ATC wants then out and AMM don't veto) only then does the 15% p.a. come into play.
I would assume it would be a compounded return thus:


Take the cash after 6 years or keep it invested and build another plant? What a nice position to be in and decision to make.
Remember the target debt/equity ratio is between 70/30 ~ 65/35.
This deal forms part or potentially all of their equity strategy. AMM is not leading us the money.
The debt strategy is already in place with KfW and nearly finalised with Macquarie. Any suggestion the deal somehow replaces Macquarie, is an alternative or will 'upset' them is wrong.
The deal will give Macquarie the confidence that ATC can secure the final equity component to make the project happen.
The mezz loan approval is critical to a future successful AAM cap raise and any other JV party (remembering the deal is non-exclusive).
Altech has always stated final equity will occur only after mezz loan approval for this obvious reason.
Prior to the deal I was concerned if mezz approval was announced in August we would see little improvement in the SP as market focus would quickly shift to the equity component - massive dilution, where are the JV partners? etc. With this equity strategy in place, I think the chance for a market re-rate on mezz approval has increased.
Now I fully understand the deal (with help from some of the great posts here), I believe it is an excellent initiative and deepens my confidence in management and the board.