Avangardco yet to choose liability management adviser

Ukraine’s largest egg producer Avangardco (AVINPU, AVGR LI) hasn’t yet chosen an adviser for the possible liability management of its USD 200 mln Eurobonds maturing in October 2015, despite proactive pitches to management, Debtwire reported on June 25. Avangardco doesn’t plan to launch any process before its 1H15 financials get published, which is expected at end-August, the report said. The likely parameters of liability management might be exchanging existing notes for new ones with longer tenure and an amended coupon (10% currently), the report said.

Roman Topolyuk: The plans to pick an advisor for the restrcuring only after the publication of its 1H15 financials are in line with what management announced during its last conference call on its 1Q15 financial performance. The company’s ability to pre-pay a certain portion of its Eurobonds will be limited, we estimate, as it expects zero to negative EBITDA in 2Q15, having reported just USD 6.4 mln (a 90% yoy decrease) in 1Q15. That means its cash position is likely to deteriorate further (vs. cash of USD 89.9 mln, as of March 2015). So the company will have to rely substantially on bondholder support to allow the liability management exercise to occur.