paragon - Agreement to sell paragon semvox

paragon has announced that it is to sell its digital assistance business unit, paragon semvox, to CARIAD, the wholly owned software subsidiary of Volkswagen. The anticipated price is c €40m, which equates to approximately 33% of paragon’s enterprise value. The disposal seems likely to provide sufficient liquidity to satisfy paragon’s bond redemptions for FY23, which should finally release the shackles on the rating. The final timing of regulatory approvals, and any additional accelerated redemptions from the recently extended eurobond, remain important. However, as financial risk is retired, attention should start to focus on paragon’s automotive growth plans.