"The combined EBITDA of the Australian, New Zealand and Canadian business units amounts to $23.4 million. If these business units were sold for a comparatively low EBITDA multiple of 7 times, gross sale proceeds would amount to $163.8 million and net sale proceeds, $126 million – after retiring all the debt of these business units. Even on a net sale proceeds basis, the Paperlinx Preference Shares would be worth $44 per security.
Note this analysis effectively assumes the entirety of the European operations – from which Paperlinx currently earns 75% of its revenue – are worth nil. It’s difficult to imagine the valuation of such a large and regionally dominant business would be worth zero. Accordingly, the PIGS view this analysis as a conservative approach to determining the total value of PaperlinX."
Obviously the analysis needs updating, but Aust/NZ ebitda is solid, the proceeds from Canada are known, and we may as well assume EU in voluntary admin is worth nil...
Looking good for the hybrids at a bargain $7.50
PXUPA only.
SRS Price at posting:
2.3¢ Sentiment: None Disclosure: Not Held
