Ann: NRW Corporate Note Update, page-2

I’m trying to digest this info, which on the face of it is not of any major consequence. However, any thoughts I’m not considering?

the facts:

- change is driven by NRW not the noteholders

- they’ve done it as soon as they could (after 2 years)

- they want to borrow more

- NRW has strong support from bankwest

- the balance sheet is low risk and leverage could be added while still keeping it relatively low risk compared to peers

- there are now some high profile divisions on the market (DOW mining services and now RCR - my sympathy to any holders there, btw)

- they are paying $0.76m to exercise this option

Maybe:

- if they were to do another acquisition funded by bank debt and an equity raise, it would be very complex on top of the existing debt security structure

- the noteholders had to approve the Golding acquisition I think and might not want to go again

- we hear about other private companies that are likely to be acquired at this point in the cycle 

- now is a good time to do a larger acquisition while the revenue runways are medium term positive and debt is staying fairly cheap

Reminder about out the notes and their existing relationship with Bankwest - 

http://thewire.fiig.com.au/article/2017/08/16/nrw-acquires-golding

cheers,

pb