BBI 0.00% $3.98 babcock & brown infrastructure group

stressed valuations

  1. 14,880 Posts.
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    I have compiled a spreadsheet and slashed 2010/11 EBITDA forecasts by between 15-20% from my "normal" figures and then also slashed the EBITDA multiple on all assets other than DBCT, NGPL and Powerco to 7.
    I have cut DBCT, NGPL and Powerco multiples by 10%. That's a savage cut for growth assets.
    The following are the distressed EV's for each asset:
    DBCT 2.7Bn
    NGPL 2.4Bn
    Powerco 817M
    IEG 672M
    CSC 140M
    WestNet Rail 665M
    Alinta 1.316Bn
    Euroports 609M

    Plug these numbers into the spreadsheet and take away all debt and I come up with a distressed BBI valuation of 4c per security. Now this also assumes no further dilution to BBI through SPARCS, BEPPA or some sort of re-structure.
    So, in a WORST case scenario WITH further dilution, BBI could well be close to worthless.
    You can see that is imperative DBCT sells for AT LEAST $2.7Bn. I'm hoping for closer to $3Bn as I would for NGPL if it were sold.
 
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