LOGM 5 ½ 09/01/2027 Corp

GoTo Group, Inc.

Credit, TMT


Publicly traded companies mentioned herein: Zoom Video Communications Inc (ZM)

Highlights

The presenter is long August 2027 5.5% secured bonds of LogMeIn, which rebranded to GoTo Group in early 2022. This issuance has just under $1B outstanding and trades at 61 (~18% YTM), and GoTo Group also has $2.2B of term loans outstanding. This long position is based on the belief that investors can create the business at 4x EBITDA compared to his expectation of an 8x valuation, meaning this is a 50% LTV security for a company that has ample liquidity, will generate positive FCF over the next 12 – 24 months, and has a best-in-class sponsor in Francisco Partners. He likens the current price to a distressed asset, allowing for equity-like returns as the company executes on an operational turnaround.

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Idea Discussion

Commentor 1 - 2 weeks ago

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