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ORCOCV 5,5 %2011 : Orco: Conference call on ColOG deal

24 juin 200912:44

Orco: Conference call on ColOG deal

Orco’s CEO Jean-François Ott spoke at a conference call with analysts and
investors regarding the details of the ColOG deal yesterday afternoon. The
main points of the conference call were as follows:

· The success of the deal depends on Orco’s bond restructuring
program, which will start in the next few days.

· The CEO said that the change in the terms of the deal came after a
decision to give current shareholders similar rights to subscribe as
those to be held by Colony Capital.

· No definition was given of what ‘successful’ bond restructuring
means and Colony Capital is not bound in any way by the current
terms; a final decision will be made in November.

· The bond restructuring program has not yet been completely
defined: among possible solutions are fully or partly exchanging
bonds for equity, or changing the bond conversion ratio and term.

· Orco will negotiate with all bond holders to propose a unified
solution. The negotiations will take place until September, when a
meeting of bond holders must approve the proposed solution with a
two-thirds majority.

Our view (KBC Securities / Patria) :
We remain negative on the company. A possible exchange of bonds into
equity will lead to a dilution effect for existing shareholders (although the
extent depends on the negotiations with bond holders), while the ColOG
deal now seems more distant and uncertain.

lucian.albulescu AT

Orco Sell
Close Price € 6.09
Fair Value 4.71
Market Cap €m 66.65
Free Float 75.8%
FY08 -35.4 n.m.
FY09E -7.9 n.m.

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