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Original-Research: DEMIRE AG - from NuWays AG

12.11.2024 / 09:01 CET/CEST
Dissemination of a Research, transmitted by EQS News - a service of EQS
Group AG.
The issuer is solely responsible for the content of this research. The
result of this research does not constitute investment advice or an
invitation to conclude certain stock exchange transactions.

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Classification of NuWays AG to DEMIRE AG

Company Name: DEMIRE AG
ISIN: DE000A0XFSF0

Reason for the research: Update
Recommendation: Buy
from: 12.11.2024
Target price: EUR 1.50
Target price on sight of: 12 months
Last rating change:
Analyst: Philipp Sennewald

Refinancing finalized - Full focus on operations

Yesterday, DMRE announced that the company had successfully the terms and
maturity of its corporate bond in a procedure under the German Bond Act.
This comes after in the beginning of September, bondholders representing
more than 90% of the aggregate outstanding principal amount of the bond
agreed to the amendment and extension of the bond. The technical
implementation has now taken place and the bond under the new conditions is
already tradeable again on the Luxembourg Stock Exchange.

As agreed upon, DMRE repaid EUR 49.9m (10% of outstanding amount) at par on
22nd October. Further, the company repaid EUR 4.6m below par as part of a
tender offer process. In addition to this, EUR 190.8 were also repurchased
below par (76.25%) and cancelled following the communicated backstop
agreement. On top of this, management aims to repurchase a further amount of
EUR 1.3m on the basis of the backstop agreement soon.

With this, DMRE already redeemed EUR 245.3m, reducing the outstanding volume
to EUR 254m. In the process, the company made use of a shareholder loan by
Apollo to the tune of EUR 92.9m. Mind you, the maturity of the bond was
extended to 2027 at an increased interest rate of 5%. Yet, management is
incentivized to reduce the volume further going forward, given penalty fees
of 3% if the bond is not reduced by another EUR 50m until YE '25 as well as 2%
if it has not been reduced by EUR 50m until YE '26. Moreover, a PIK interest
of 3% will kick in starting FY '27. On this basis, we expect DMRE to dispose
further assets in order to shore up liquidity. Management is confident to
close 3 deals until YE '24 und dispose overall EUR 50m until FY '25e.

Besides this, the company received positive news regarding the rating of its
bond, which Moody's upgraded to Caa2 while changing the outlook to stable.
The stock remains undervalued given the significant and, in our view,
unjustified NAV discount of 73%.

Hence, we reiterate BUY with an unchanged PT of EUR 1.50 based on NAV.

+++ For further information on the company's strategy following the
refinancing, there will be a roundtable
discussion with CFO Tim Brückner on Wednesday at 11:00 a.m. ( LINK) +++

You can download the research here: http://www.more-ir.de/d/31279.pdf
For additional information visit our website: www.nuways-ag.com/research

Contact for questions:
NuWays AG - Equity Research
Web: www.nuways-ag.com
Email: research@nuways-ag.com
LinkedIn: https://www.linkedin.com/company/nuwaysag
Adresse: Mittelweg 16-17, 20148 Hamburg, Germany
++++++++++
Diese Meldung ist keine Anlageberatung oder Aufforderung zum Abschluss
bestimmter Börsengeschäfte.
Offenlegung möglicher Interessenskonflikte nach § 85 WpHG beim oben
analysierten Unternehmen befinden sich in der vollständigen Analyse.
++++++++++

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2027521 12.11.2024 CET/CEST

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