Villa World - Acquisition Proposal & Sell Recommendation

After the ASX had closed on 14 March 2019, Villa World (ASX: VLW) announced that it had received an unsolicited proposal from AVID Property Group (AVID) to acquire all of the shares in Villa World by way of a scheme of arrangement.

On 15 March 2019, we revised our recommendation to Sell given the potential for a Change of Control clause being triggered which would prompt a capital loss for bondholders.  We had previously revised our Outlook on VLW to Deteriorating following concerns on settlement risk after its 1H19 results in February 2019.

Please see our research report here for further details.