Hi mate, thanks for posting the data.
Found this on investopedia. It appears that the market value for the debt + equity is less than the actual debt itself. Which probably is calculated from the 40% haircut discussed in the media/other threads.
If so, then it appears someone is trying to buy the NAB and Wespac debt with a 40% haircut. And from an accounting perspective, they need to take that into account ( I believe).
However, I think this can confirm a few things:
1. the business is in stress, hence negotiation with the bank around 40% haircut
2. this is another possibility: SGH have been engaged by a third party aiming to assist with the restructure, and with options on their side, they may be trying to intimidate the banks so that they can give some leigh-way i.e. they may agree to a 10% hair cut, because it's better than 40%, but 40% is what SGH started with the negotiation (like cutting for prices in the streets).
3. I think this also confirms that the relationship between SGH and the bank is not so rosy, at least in SGH's mind they don't think Banks will extend the 2018 deadline, as they are not meeting the targets at this stage. Hence siding with some third party (you can't work out market value, by just trying to buy out the debt through DE I suspect, so a third party is probably involved).
BREAKING DOWN 'Enterprise Value (EV)'
Enterprise value can be thought of as the theoretical takeover price if the company were to
bought. In the event of such a buyout, an acquirer would generally have to take on the company's debt, but would pocket its cash for itself. EV differs significantly from simple market capitalization in several ways, and many consider it to be a more accurate representation of a firm's value.
The value of a firm's debt, for example, would need to be paid by the buyer when taking over a company, thus enterprise value provides a much more accurate takeover valuation because it includes debt in its value calculation.
