/raid1/www/Hosts/bankrupt/TCREUR_Public/180214.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
E U R O P E
Wednesday, February 14, 2018, Vol. 19, No. 032
Headlines
C R O A T I A
AGROKOR DD: Minister Calls for Speedy Adoption of Settlement
C Y P R U S
ARAGVI HOLDING: Moody's Assigns (P)B3 CFR, Outlook Stable
F I N L A N D
PAROC GROUP: Moody's Withdraws B2 Corporate Family Rating
G E R M A N Y
HT1 FUNDING: Fitch Affirms 'BB' Tier 1 Securities Rating
HYPO VORARLBERG: Moody's Hikes MTN Program Rating from (P)Ba1
NIDDA BONDCO: Moody's Assigns B2 CFR, Outlook Stable
I R E L A N D
EURO-GALAXY VI: Moody's Assigns (P)B2 Rating to Cl. F Sr. Notes
GTLK EUROPE: Moody's Rates New US Dollar Sr. Unsec. Notes (P)Ba3
GTLK EUROPE: Fitch Rates Upcoming Guaranteed Notes 'BB(EXP)'
ST. PAUL'S CLO III-R: Fitch Rates Class F-R Notes 'B-sf'
M A C E D O N I A
PROCREDIT BANK: Fitch Changes Outlook to Pos., Affirms BB+ IDRs
N E T H E R L A N D S
LOWLAND MORTGAGE 3: Fitch Lowers Cl. D Debt Rating to 'BB-sf'
S E R B I A
TARGO TELEKOM: March 22 Bid Submission Deadline Set
S W I T Z E R L A N D
SCHMOLZ + BICKENBACH: S&P Affirms B+ CCR, Alters Outlook to Neg.
U N I T E D K I N G D O M
CARILLION PLC: Accountancy Firms Face Questions Over Audits
ENTERTAINMENT ONE: Moody's Affirms Ba3 CFR, Outlook Stable
EXTERION MEDIA: Moody's Lowers CFR to Caa1, Outlook Negative
GRORUD ENGINEERING: Enters Liquidation After Missing Payments
JAMIE'S ITALIAN: Owed $125MM to Creditors, CVA Saves 1,800 Jobs
NEWGATE FUNDING 2007-3: S&P Raises Cl. E Notes Rating to B+ (sf)
SEADRILL LTD: Nears Resolution of Dispute Over Restructuring
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C R O A T I A
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AGROKOR DD: Minister Calls for Speedy Adoption of Settlement
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SeeNews reports that Croatia's economy minister said on Feb. 8
the temporary creditors' council of the country's ailing Agrokor
concern should by the middle of this week agree on a set of
activities to speed up the adoption of a settlement plan
proposed by the concern's extraordinary management.
According to SeeNews, the government said in a statement
following her meeting with the temporary creditors' council,
representatives of Agrokor's suppliers and bond holders, as well
as secured and unsecured creditors, Martina Dalic called for a
speedy resolution of the extraordinary administration procedure
in the concern.
"The former management in Agrokor brought the company, which has
a large impact on Croatia's economy and on the region, to the
verge of bankruptcy," Ms. Dalic, as cited by SeeNews, said,
adding that thanks to the government's law on extraordinary
management the concern's business has been stabilized. "I now
expect the temporary creditors' council to do everything in their
power to put the proposed settlement to a vote."
It is important for all of Agrokor's creditors to reach a fair
and balanced settlement in order to recover as much of their debt
as possible, she stressed, notes the report.
In December, Agrokor's extraordinary management unveiled a debt
settlement plan under which the creditors and suppliers of the
troubled concern will take full control of a new holding company
and its units, to which the assets of the sound segments of the
Agrokor group will be transferred, SeeNews recounts.
The debt settlement proposal must be submitted to the Commercial
Court in Zagreb by April 10 at the latest, SeeNews notes.
About Agrokor DD
Founded in 1976 and based in Zagreb, Crotia, Agrokor DD is the
biggest food producer and retailer in the Balkans, employing
almost 60,000 people across the region with annual revenue of
some HRK50 billion (US$7 billion).
On April 10, 2017, the Zagreb Commercial Court allowed the
initiation of the procedure for extraordinary administration over
Agrokor and some of its affiliated or subsidiary companies. This
comes on the heels of an April 7, 2017 proposal submitted by the
management board of Agrokor Group for the administration
proceedings for the Company pursuant to the Law of Extraordinary
Administration for Companies with Systemic Importance for the
Republic of Croatia.
Mr. Ante Ramljak was simultaneously appointed extraordinary
commissioner/trustee for Agrokor on April 10.
In May 2017, Agrokor dd, in close cooperation with its advisors,
established that as of March 31, 2017, it had total liabilities
of HRK40.409 billion. The company racked up debts during a rapid
expansion, notably in Croatia, Slovenia, Bosnia and Serbia, a
Reuters report noted.
On June 2, 2017, Moody's Investors Service downgraded Agrokor
D.D.'s corporate family rating (CFR) to Ca from Caa2 and the
probability of default rating (PDR) to D-PD from Ca-PD. The
outlook on the company's ratings remains negative. Moody's also
downgraded the senior unsecured rating assigned to the notes
issued by Agrokor due in 2019 and 2020 to C from Caa2. The
rating actions reflect Agrokor's decision not to pay the coupon
scheduled on May 1, 2017 on its EUR300 million notes due May 2019
at the end of the 30-day grace period. It also factors in Moody's
understanding that the company is not paying interest on any of
the debt in place prior to Agrokor's decision in April 2017 to
file for restructuring under Croatia's law for the Extraordinary
Administration for Companies with Systemic Importance.
On June 8, 2017, Agrokor's Agrarian Administration signed an
agreement on a financial arrangement agreement worth EUR480
million, including EUR80 million of loans granted to Agrokor by
domestic banks in April. In addition to this amount, additional
buffers are also provided with additional EUR50 million of
potential refinancing credit. The total loan arrangement amounts
to EUR1,060 million, of which a new debt totaling EUR530 million
and the remainder is intended to refinance old debt.
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C Y P R U S
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ARAGVI HOLDING: Moody's Assigns (P)B3 CFR, Outlook Stable
---------------------------------------------------------
Moody's Investors Service has assigned a provisional (P)B3
corporate family rating (CFR) to Aragvi Holding International
Ltd. (Aragvi), a trading company which is the major exporter of
agricultural commodities from Moldova.
At the same time, Moody's has assigned a (P)B3 rating to the
proposed debut senior unsecured USD-denominated 5-year notes to
be issued by Aragvi Finance International DAC, which is a
designated activity company incorporated under the laws of
Ireland and is a wholly owned subsidiary of Aragvi.
The ratings outlook is stable. This is the first time that
Moody's has assigned ratings to Aragvi.
The company will mainly use the proceeds from the notes issuance
to refinance most of its secured debt.
The provisional nature of the ratings assigned indicates that B3
ratings are subject to the successful notes placement and
completion of the refinancing, as planned. Moody's will assign a
definitive corporate family and instrument ratings upon review of
the final credit documentation. The definitive ratings may differ
from the provisional ratings.
Aragvi's (P)B3 CFR reflects the company's small size compared to
its global merchandising and processing peers, and its reliance
on one small geography, Moldova, for the sourcing of its
commodities. At the same time, the rating factors in Aragvi's
sustainably strong position as the major exporter of agricultural
commodities in Moldova, which is supported by the company's
ownership of domestically unique logistic and industrial
processing facilities, underpinning Aragvi's high margins and
capacity for cash flow generation. The absence of derivative
trading, tight risk control and adequate liquidity, which,
however, is subject to the refinancing, support the rating.
Moody's expects that, following the notes issuance, the company
should improve its liquidity by increasing its debt maturity
profile and eliminating bank covenant pressure. The notes will
refinance most of the company's loans, as secured by fixed
assets, and debt under some of its short-term trading finance
facilities.
RATINGS RATIONALE
Aragvi's (P)B3 CFR is constrained by the company's small size
(revenue of $350 million and gross fixed assets of $290 million),
limited product diversification and significant reliance on one
small region, the territory of Moldova, for the sourcing of its
commodities. These factors heighten the inherent risks of the
agricultural commodity industry, resulting in volatility in
earnings and cash flow, as well as exposure to unexpected changes
in government policies, as faced by companies engaged in
commodity export operations.
Moody's notes that this reliance on the sourcing of a few select
agricultural commodities from one small geography and the
cyclical nature of the agricultural commodity industry can
potentially challenge the company's plan to significantly grow
and sustainably de-leverage towards adjusted net debt/EBITDA of
3x and below over the next 12-18 months.
At the same time, the CFR is underpinned by Aragvi's sustainable
and dominant position in Moldova as the major exporter of
agricultural goods. The position is backed by its ownership of
the domestically unique export infrastructure, including storage
and port facilities, and as such, it cannot be easily matched by
local competitors/new market entrants, at least in the medium
term. Moreover, as Aragvi owns and operates the largest commodity
processing facilities in Moldova, namely sunflower seed crushing
and oil refining, this further supports its dominance in
Moldova's market and contributes to the company's sustainably
high adjusted EBITDA margins of around 12%. Its established,
solid client base, which includes large global trade houses, and
proximity to key markets in Europe, the Black Sea, Mediterranean
and Middle East regions, support Aragvi's business.
In FY2017 ended June 2017, Aragvi's adjusted net debt/EBITDA was
4.8x. Moody's expects the company to decrease it to around 4x and
below in FY2018 and thereafter, assuming the sustainability of
its high margins, strong harvests, and the absence of significant
global market shocks. The absence of derivative trading and tight
risk control -- to which Moody's expects Aragvi will remain
committed to -- should support the company's ability to
deleverage.
Immediately following the refinancing, Aragvi's long-term debt
will be largely represented by the notes, which will likely
account for around 75% of total debt pro forma for the end of
2017. Principal repayments of other long-term debt over the next
12-18 months will be limited to $7 million in December 2018. The
share of short-term debt under trade finance facilities should
decrease following the refinancing. However, the level of this
debt will continue to fluctuate, given the seasonality of the
company's business and its short-term funding requirements as
well as the volatility of commodity prices. The company's liquid
commodity inventories will also fluctuate, but would no longer be
fully pledged as security following the notes refinancing and
hence could serve as alternative liquidity (estimated at $50
million at end-Q1 2018).
Moody's also notes Aragvi's capex flexibility, which will
additionally mitigate pressure on its cash flow and liquidity.
STRUCTURAL CONSIDERATIONS
The notes are rated on par with the (P)B3 CFR, and will be
unsecured obligations and rank pari passu with all outstanding
unsecured and unsubordinated obligations of the company.
The notes will benefit from guarantees from Aragvi and all
material subsidiaries, which together account for around 90% of
the group's consolidated fixed assets and EBITDA. Furthermore,
the notes will largely refinance the company's current secured
debt held by the company's operating subsidiaries, resulting in
an immaterial level of fixed asset-secured debt in the capital
structure.
Moody's notes that Aragvi will maintain several trade finance
facilities at its operating subsidiaries. The outstanding balance
under these facilities is secured by the company's liquid
commodity inventories. The outstanding balance will fluctuate
depending on the seasonality of the business, although Moody's
expects it will be significantly reduced with the anticipated
refinancing. The rating of the notes on par with the CFR assumes
that the share of secured financing, after the refinancing, will
not increase materially going forward.
RATIONALE FOR THE STABLE OUTLOOK
The stable outlook reflects Moody's expectation that Aragvi will
continue increasing the scale of its operations, as well as its
cash generation capacity, while maintaining high margins,
deleveraging to below adjusted net debt/EBITDA of 4x and keeping
adequate liquidity over the next 12-18 months.
WHAT COULD CHANGE THE RATINGS DOWN/UP
The rating could be upgraded if the company materially increases
its business volumes, while maintaining high margins and
sustainably decreasing its leverage to adjusted net debt/EBITDA
of 3x. The rating could be downgraded if the company fails to
deleverage, with the risk of its leverage trending sustainably to
above 5.5x on an adjusted net debt/EBITDA basis, and/or if the
company does not sustain adequate liquidity over at least a 12
month horizon.
PRINCIPAL METHODOLOGY
The principal methodology used in these ratings was Trading
Companies published in June 2016.
Aragvi Holding International Ltd. (Aragvi), which is domiciled in
Cyprus, is mainly engaged in the origination and marketing of
agricultural commodity products, including sunflower seed, wheat
and corn. It is the major exporter of these products from
Moldova. The company's trading business is supported and
supplemented by its domestically unique infrastructure (storage
and port facilities) and oil seed processing facilities located
predominantly in Moldova. In FY 2017 ended June 2017, Aragvi's
revenue were $350 million revenue, with 75% generated from
trading and 23% from oilseed crushing and oil refining. The
company's adjusted FY 2017 EBITDA was $45 million. The sole owner
of Aragvi is Mr. Vaja Jhashi.
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F I N L A N D
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PAROC GROUP: Moody's Withdraws B2 Corporate Family Rating
---------------------------------------------------------
Moody's Investors Service has withdrawn the B2 corporate family
rating (CFR) and the B2-PD probability of default rating (PDR) of
Finland-based stone wool insulation producer Paroc Group Oy
("Paroc"), following its acquisition by Owens Corning (Ba1
stable) on 5 February for an enterprise value of approximately
EUR900 million, as there is no debt outstanding any more. At the
time of the withdrawal the ratings were under review for upgrade.
RATINGS RATIONALE
The rating action follows the repayment of Paroc's rated debts
and concludes the review for upgrade process, initiated on
November 2, 2017, after all regulatory requirements have been
obtained for the transaction to become effective. With the
integration of Paroc, Owens Corning aims to broaden the product
and geographic diversity of its own Insulation business.
Paroc is a Finland-based stone wool insulation producer, serving
multiple end-markets including construction, HVAC, process
industries, marine and OEMs. Paroc's products include building
insulation, technical insulation, marine insulation, and acoustic
products. In the 12 months ended September 2017, the group
generated sales of EUR402 million and management-adjusted EBITDA
of EUR79 million. Paroc operates production facilities in
Finland, Sweden, Lithuania, Poland and Russia and has sales
companies across 13 European countries with over 1,800 employees.
LIST OF WITHDRAWN RATINGS
Issuer: Paroc Group Oy
Withdrawals:
-- Corporate Family Rating, previously B2
-- Probability of Default Rating, previously B2-PD
-- Senior Secured Bank Credit Facilities, previously B2
Issuer: Paroc Oy Ab
Withdrawals:
-- Backed Senior Secured Bank Credit Facility, previously B2
Outlook Actions:
-- Outlooks changed to Rating Withdrawn from Rating Under Review
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G E R M A N Y
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HT1 FUNDING: Fitch Affirms 'BB' Tier 1 Securities Rating
--------------------------------------------------------
Fitch Ratings has affirmed Commerzbank AG's (CBK) Long-Term
Issuer Default Rating (IDR) at 'BBB+', Viability Rating (VR) at
'bbb+' and Short-Term IDR at 'F2'. The Outlook is Stable.
KEY RATING DRIVERS
IDRS, VR AND SENIOR DEBT
CBK's IDRs, VR and senior debt ratings reflect its modest
profitability, adequate asset quality in the core bank,
satisfactory capitalisation driven by further deleveraging as
well as solid funding and liquidity. They also take into account
the progress made in its strategic transformation process, which
is ongoing and in Fitch opinion, gives rise to execution risk.
CBK's strategic transformation into a multi-channel bank is
operationally on track and CBK is ahead of its client acquisition
targets. The bank's profitability remains modest when compared
with direct peers because of strong and front-loaded investments
in its infrastructure and provisions for its staff reduction
plan, but in Fitch opinion, downside risk to revenue generation
has reduced given the bank's performance to date. Credit losses
are moderate but still higher than peers because of impairment
charges relating to the wind-down of its legacy shipping and
commercial real estate exposure as well as a large single loss
event at end-2017. Fitch expect a gradual improvement in CBK's
earnings if it manages to convert customer growth into revenue
growth without compromising margins.
Asset quality in CBK's core segments is in line with peers and
has benefited from Germany's strong economic environment. The
total volume of non-performing loans (NPL) dropped to EUR5.6
billion at end-2017 thanks to further reductions in its non-core
legacy shipping and commercial real estate portfolio pooled in
its declining asset and capital recovery unit (ACR). Fitch expect
a small set-back in asset quality due to a single loss event in
2017, but further de-risking in ACR, particularly shipping, an
adequate coverage ratio and the sufficient sectoral
diversification in the corporate/SME portfolio underpin CBK's
asset quality.
CBK's capitalisation and leverage are adequate. At end-2017, it
reported a fully loaded CET1 ratio of 14.1%, well above the
bank's fully phased-in SREP requirement of 10.75% (assuming an
unchanged Pillar 2 requirement), and a fully loaded leverage
ratio of 5.1%. Recent improvements in the CET1 ratio were
primarily driven by a EUR19 billion reduction in RWAs during
2017, following an accelerated ACR wind-down, a securitisation
transaction and moderate currency effects due to the
strengthening euro. Further contributions came from declining
market and operational risk RWAs. CBK is targeting a CET1 ratio
of about 12% during the transition period and above 13% for 2020.
CBK's liquidity is sound and its funding is balanced and stable.
The bank benefits from its established domestic franchise that
allows stable access to a broad, diversified and granular deposit
base. CBK also has good access to wholesale funding with a broad
and international investor base. Reliance on unsecured wholesale
funding is moderate, as about half of CBK's capital market
funding is in the form of covered bonds, which have proved to be
a stable and inexpensive source of funding even in times of
stressed markets.
CBK's senior unsecured debt considered by Fitch as non-preferred
is rated in line with the bank's IDRs. Structured notes with
embedded market risk (ISIN XS0590249222 and DE000CZ426G2) are
rated one notch above the bank's Long-Term IDR because they
benefit from protection provided by the combined buffers of
qualifying junior and non-preferred senior debt (see DCR and
Deposit Ratings below).
The short-term rating of Commerzbank U.S. Finance Inc's
commercial paper programme is equalised with CBK's Short-Term
IDR. This reflects Fitch view of the high likelihood that CBK
would support its US commercial paper programme, in case of need.
SUPPORT RATING AND SUPPORT RATING FLOOR
CBK's Support Rating (SR) and Support Rating Floor (SRF) reflect
Fitch view that following the implementation of the resolution
legislation and tools senior creditors can no longer rely on
receiving full extraordinary support from the sovereign in the
event that CBK becomes non-viable.
SUBORDINATED DEBT AND OTHER HYBRID SECURITIES
The ratings on subordinated debt and other hybrid capital issued
by CBK are notched down from CBK's VR in accordance with Fitch's
assessment of each instrument's respective non-performance and
relative loss severity risks.
HT1 Funding GmbH's Tier 1 securities, which have a distributable
profit trigger, are rated four notches below CBK's VR, comprising
two notches each for loss severity and for non-performance risk.
Dresdner Funding Trust I's securities, which have a regulatory
capital ratio trigger, are rated three notches below CBK's VR,
comprising two notches for loss severity and one notch for non-
performance risk. Dresdner Funding Trust I has always paid its
coupons whereas CBK's legacy Tier 1 instruments with a
distributable profit trigger have not, which is reflected in the
one-notch difference.
DERIVATIVE COUNTERPARTY RATING AND DEPOSIT RATINGS
CBK's Derivative Counterparty Rating (DCR) reflects Fitch's view
that the bank has sufficient combined buffers of qualifying
junior and non-preferred senior debt that could be used to
recapitalise it, restore its viability and prevent default on
other "preferred" senior liabilities upon resolution. The
protection afforded to "preferred" senior debt, deposits and
derivative counterparties by those buffers means the DCR and
Long-Term Deposit Ratings are each given a one-notch uplift above
the Long-Term IDR to reflect these liabilities' lower
vulnerability to default than vanilla senior debt.
CBK's Short-Term Deposit Rating is aligned with the bank's Short-
Term IDR, which is the lower of the two options available at a
'A-' level. This is because of high uncertainty regarding the
bank's likely balance sheet composition upon default and how a
resolution scenario would affect short-term depositors in
Germany, given the lack of precedent for favouring short-term
creditors.
RATING SENSITIVITIES
IDRS, NATIONAL RATINGS AND SENIOR DEBT
Upside to CBK's ratings is limited, as an upgrade would require a
structural improvement in the bank's earnings, which Fitch
believe is unlikely as profitability will be burdened by
restructuring costs over the next two years, while revenue
remains under pressure from low interest rates and competition.
A significant improvement in profitability could result in an
upgrade, if the bank maintains sound asset quality in its core
portfolio and achieves further material progress in winding down
the shipping portfolio.
CBK's ratings are also sensitive to the progress in the
implementation of the bank's strategic plan. The ratings would
come under pressure if execution risks materialise, which could
lead to insufficient revenue generation, significantly higher
restructuring costs or a loss in franchise.
The short-term rating of Commerzbank U.S. Finance Inc's
commercial paper programme is sensitive to changes to CBK's
Short-Term IDR.
SUPPORT RATING AND SUPPORT RATING FLOOR
An upgrade of the SR and upward revision of the SRF would require
a positive change in the sovereign's propensity to support its
banks. While not impossible, this is highly unlikely in Fitch's
view.
SUBORDINATED DEBT AND OTHER HYBRID SECURITIES
CBK's debt ratings are sensitive to changes in CBK's VR, from
which they are notched, or to a change in Fitch's assessment of
the notes' loss severity or their relative non-performance risk.
DCR AND DEPOSIT RATINGS
The DCR, Deposit Ratings and rating of the structured notes with
embedded market risk are primarily sensitive to changes in CBK's
IDRs. They are also sensitive to the amount of subordinated and
senior vanilla debt buffers relative to the recapitalisation
amount likely to be needed to restore the bank's viability and
prevent default on more senior derivative obligations, deposits
and structured notes with embedded market risk.
High short-term volatility or long-term inflation of RWAs as a
direct result of the implementation of more stringent regulatory
requirements could materially increase the debt buffer needed to
recapitalise the bank upon failure and further justify the rating
uplift.
The DCR, Deposit Ratings and rating of the structured notes with
embedded market risk are also sensitive to increases in the
bank's individual pillar 2 regulatory requirements as Fitch
assume that these determine the level to which the bank would
have to be recapitalised upon resolution.
Furthermore, the DCR, Deposit Ratings and rating of the
structured notes with embedded market risk are sensitive to
Fitch's assumptions regarding the individual point of non-
viability at which the regulator is likely to require a
recapitalisation by way of bail-in of junior and standard senior
instruments.
Subsequent changes to the resolution regime, which may alter the
hierarchy of the various instruments in resolution, could also
trigger changes in the DCR and Deposit Ratings.
The rating actions are as follows:
Commerzbank AG
Long-Term IDR affirmed at 'BBB+'; Outlook Stable
Short-Term IDR affirmed at 'F2'
Viability Rating: affirmed at 'bbb+'
Support Rating: affirmed at '5'
Support Rating Floor: affirmed at 'No Floor'
Commercial paper and certificates of deposits: affirmed at 'F2'
Senior unsecured debt: affirmed at 'BBB+'
Market linked securities: affirmed at 'A-emr'
Derivative Counterparty Rating: affirmed at 'A-(dcr)'
Long-Term Deposit rating: affirmed at 'A-'
Short-Term Deposit rating: affirmed at 'F2'
Commerzbank U.S. Finance, Inc.'s Short-Term rating: affirmed at
'F2'
Subordinated debt: affirmed at 'BBB'
Subordinated debt (Dresdner Funding Trust IV (XS0126779791,
26157HAA6)): affirmed at 'BBB'
Dresdner Funding Trust I's dated silent participation
certificates (XS0097772965, 26156FAA1): affirmed at 'BB+'
HT1 Funding GmbH Tier 1 Securities (DE000A0KAAA7): affirmed at
'BB'
HYPO VORARLBERG: Moody's Hikes MTN Program Rating from (P)Ba1
-------------------------------------------------------------
Moody's Investors Service has upgraded Hypo Vorarlberg Bank AG's
(Hypo Vorarlberg) long-term senior unsecured debt, issuer and
deposit ratings by one notch to A3 from Baa1, and maintained a
stable outlook on these ratings. Moody's also upgraded Hypo
Vorarlberg's subordinate MTN program rating to (P)Baa3 from
(P)Ba1 and affirmed the bank's short-term issuer and deposit
ratings at P-2.
Concurrently, Moody's upgraded the bank's Baseline Credit
Assessment (BCA) and adjusted BCA to baa2 from baa3 and its
Counterparty Risk (CR) Assessments to A2(cr)/P-1(cr) from
A3(cr)/P-2(cr).
The rating upgrade reflects the strengthening of the bank's
financial fundamentals following the capital measures agreed upon
and partly executed at the end of 2017 which will strengthen the
bank's ability to establish its risk-weighted core capital ratios
sustainably above 13% going forward. The upgrade also
incorporates the reduced exposure to tail risks, following the
maturity of the largest part of the deficiency-guaranteed
liabilities issued by Austria's Landeshypothekenbanks, including
its joint issuance vehicle Pfandbriefbank (Oesterreich) AG
(Pfandbriefbank).
RATINGS RATIONALE
-- UPGRADE OF THE BCA
The upgrade of the BCA to baa2 from baa3 reflects the bank's
sustainably improved capitalisation and its reduced asset tail
risks. In December 2017, Hypo Vorarlberg executed a synthetic
securitisation transaction that has helped the bank to reduce its
risk-weighted assets. In parallel, Moody's expect a conversion of
legacy capital instruments into high trigger Additional Tier 1
and common equity instruments that will strengthen in the near
term its Tangible Common Equity, Moody's key metric measuring
core bank capital.
At the same time, Moody's expects Hypo Vorarlberg's problem loan
ratios to have further improved in 2017 and to remain at low
levels in 2018, despite the impairment of its participation in
venture capital subsidiary Hypo Equity Unternehmensbeteiligungen
AG. The positive asset risk trends have been reinforced by a
reduction of tail risks associated with the joint and several
liability Hypo Vorarlberg has been sharing in Pfandbriefbank.
The baa2 BCA is also based on Hypo Vorarlberg's success in better
spreading out its maturity profile following the refinancing of
its 2017 bond maturities, while at the same time maintaining
sufficient liquid resources.
-- UPGRADE OF LONG-TERM RATINGS TO A3
The one-notch upgrade of Hypo Vorarlberg's long-term ratings to
A3 reflects the one-notch upgrade of the bank's BCA and adjusted
BCA to baa2 from baa3 while the result of Moody's Advanced Loss
Given Failure (LGF) analysis, which takes into account the
severity of loss faced by the different liability classes in
resolution, provides an unchanged two notches rating uplift to
Hypo Vorarlberg's long-term instrument classes.
The refinancing in 2017 of Hypo Vorarlberg's somewhat
concentrated senior unsecured and subordinated liabilities has
not led to a material reduction in the amount of subordinated and
equal-ranking debt issued by Hypo Vorarlberg.
-- STABLE OUTLOOK ON HYPO VORARLBERG'S LONG-TERM RATINGS
The stable outlook on the long-term senior unsecured debt, issuer
and deposit ratings of Hypo Vorarlberg incorporates Moody's
expectation that Hypo Vorarlberg will be able to sustain stronger
capitalisation levels in the medium term and to further reduce
its foreign currency (CHF-denominated) asset exposures. At the
same time, Moody's expects the bank to maintain a broadly stable
liability structure and adequate liquid resources.
-- WHAT COULD MOVE THE RATINGS UP/DOWN
Upward pressure on Hypo Vorarlberg's BCA and its long-term
ratings could result from: (1) further improvement of its capital
ratios, (2) a continued reduction in market funding reliance or
an improvement in unencumbered liquid assets and (3) sustainably
positive net income trends.
Hypo Vorarlberg's ratings could be downgraded if the bank's
liability structure's dependence on secured funding sources were
to increase beyond the rating agency's current expectations, at
the expense of bail-in-able senior unsecured and subordinated
debt components. The ratings could also be downgraded if Hypo
Vorarlberg's financial strength unexpectedly and significantly
deteriorated following: (1) renewed signs of asset quality
weakness, particularly if investments of its subsidiary Hypo
Equity attracted significant additional impairments; and/or (2) a
material reduction of its capitalisation.
LIST OF AFFECTED RATINGS
Upgrades:
-- LT Bank Deposits (Local & Foreign Currency), Upgraded to A3
from Baa1, Outlook remains Stable
-- LT Senior Unsecured (Local & Foreign Currency), Upgraded to
A3 from Baa1, Outlook remains Stable
-- Senior Unsecured MTN (Local Currency), Upgraded to (P)A3 from
(P)Baa1
-- LT Issuer Rating (Local & Foreign Currency), Upgraded to A3
from Baa1, Outlook remains Stable
-- Subordinate MTN (Local Currency), Upgraded to (P)Baa3 from
(P)Ba1
-- Adjusted Baseline Credit Assessment, Upgraded to baa2 from
baa3
-- Baseline Credit Assessment, Upgraded to baa2 from baa3
-- LT Counterparty Risk Assessment, Upgraded to A2(cr) from
A3(cr)
-- ST Counterparty Risk Assessment, Upgraded to P-1(cr) from P-
2(cr)
Affirmations:
-- ST Bank Deposits (Local & Foreign Currency), Affirmed at P-2
-- ST Issuer Rating (Local & Foreign Currency), Affirmed at P-2
Outlook Actions:
-- Outlook, Remains Stable
PRINCIPAL METHODOLOGY
The principal methodology used in these ratings was Banks
published in September 2017.
NIDDA BONDCO: Moody's Assigns B2 CFR, Outlook Stable
----------------------------------------------------
Moody's Investors Service has assigned a definitive B2 CFR and a
new B2-PD Probability of default rating to Nidda BondCo GmbH
(Nidda BondCo). The provisional ratings were assigned on
September 07, 2017, and Moody's rating rationale was set out in a
press release published on the same day. Concurrently Moody's has
assigned definitive B2 instrument ratings to around EUR1,700
million of senior secured 1st lien term loan B1 and B2, to EUR735
million of senior secured 1st lien notes and to EUR400 million of
senior secured 1st lien revolving credit facility issued by Nidda
Healthcare Holding AG (Nidda Healthcare). Moody's has also
assigned a definitive Caa1 instrument rating to EUR340 million of
senior secured 2nd lien notes issued by Nidda BondCo GmbH. The
outlook on all ratings is stable.
RATINGS RATIONALE
The assignment of the definitive B2 CFR follows the successful
vote of shareholders of Stada Arzneimittel AG (Stada) in favor of
the implementation of a domination and profit and loss transfer
agreement between Nidda Healthcare Holding AG and Stada
Arzneimittel AG on February 02, 2018. However Moody's notes that
Nidda Healthcare has not yet squeezed out minority shareholders
and continues to own only 65% of Stada Arzneimittel AG shares. If
the status quo prevail this would lead to material cash leakage
to minority shareholders. Moody's current B2 CFR continues to
assume that Nidda Healthcare will aim at achieving a 100%
ownership of Stada Arzneimittel AG and will use the debt quantum
raised in September 2017 for that purpose. The current rating
also assumes that any additional funds required to buy out
minority shareholders in excess of the initial debt quantum
raised in September would be funded from an equity injection from
the private equity sponsors. The utilization of the funds raised
in September 2017 for other purposes including M&A transactions
could also lead to negative pressure on the current rating.
The B2 Corporate Family rating assigned to Nidda BondCo GmbH
reflects the group's (i) diversified small molecule generics
portfolio with 13,000 SKUs and a good geographical split across
key European generics markets, (ii) track record in bringing new
small molecules generics drugs to the market and a healthy small
molecule generics pipeline, (iii) strong Over-the-Counter ('OTC')
brand portfolio with leading market positions across various
therapeutic areas and geographic markets, (iv) potential to
reduce costs with a stronger focus on operational excellence than
on revenue growth and to benefit from a recovery in Eastern
European markets, which have negatively impacted Stada's OTC
performance over the last three years (840bps decline in Stada's
adjusted EBITDA margin between 2013 and 2016). In this regard
Moody's note Stada's solid operating performance for its OTC
business year-to-date September 2017, which has positively
contributed to a total group revenue growth of 10% and a 100bps
increase in total group adjusted EBITDA margin to 20.5%. The
company has also confirmed its full year 2017 guidance.
Nidda BondCo's Corporate Family rating is mainly constrained by
(i) the leveraged pro-forma capital structure of the group (pro-
forma Moody's Adjusted Gross Debt/EBITDA of around 7.0x as per
LTM Sepember 2017 assuming a 100% squeeze out of minority
shareholders without any additional debt) albeit with good
deleveraging prospects thanks to expected growth in both EBITDA
and FCF generation, (ii) the relatively commoditized nature of
Stada's generic portfolio focused largely on solid and liquid
small molecule generics with a large tail of products in
competitive markets (approximately 50% of the portfolio), (iii)
currency mismatch between cost basis and revenue basis in the
Eastern European OTC business, which alongside underlying market
weaknesses has led to a material deterioration in profitability,
(iv) a higher than average degree of execution risk in the
implementation of the new cost initiatives and (v) Stada's
relatively small size in the context of the European and global
pharmaceutical rated universe.
RATIONALE FOR THE STABLE OUTLOOK
Nidda BondCo is weakly positioned in its rating category at the
closing of the acquisition as a result of a high pro-forma
opening leverage (pro-forma Moody's adjusted Gross debt /EBITDA
of around 7.0x assuming a 100% squeeze out of minority
shareholders without any additional debt). The stable outlook
assigned to the ratings reflects Moody's expectation that Nidda
BondCo will swiftly delever to Debt/EBITDA of sustainably below
6.0x at the latest 18 to 24 months after the closing of the
acquisition supported by a recovery in the underlying operating
performance in 2017 and beyond as well as by the execution of
cost reduction measures to be implemented over the next 24
months. Failure to swiftly delever to a target level of
Debt/EBITDA below 6.0x in the two years post acquisition
(assuming 100% ownership of Stada) would exert negative pressure
on the ratings. There is little or no headroom for further debt
financed acquisitions (not reflected in the company's underlying
business plan) prior to achievement of envisaged cost synergies.
LIQUIDITY
The liquidity position of Nidda BondCo at closing of the
transaction is solid. While the two acquirers have not overfunded
the transaction to ensure a minimum cash balance at closing, the
access to a sizeable revolving credit facility of EUR400 million
should offer sufficient liquidity buffer to run the operations
smoothly. Moody's also note that Nidda BondCo has raised funds to
buy out 100% of the shares of Stada, which has not happed yet. As
a result Nidda BondCo is currently sitting on a material cash
position. Nidda BondCo should also have sufficient headroom under
its springing covenant to ensure access to the revolving credit
facility at any time.
STRUCTURAL CONSIDERATIONS
In light of the mixed capital structure including both bank debt
and bonds Moody's has applied a recovery rate of 50% for the
corporate family. The recovery rate assumption of 50% is further
supported by the covenant lite package with only a springing
covenant on the revolving credit facility protecting creditors.
The B2 ratings assigned to the senior secured 1st lien term loan
B1 and B2, senior secured 1st lien notes and senior secured 1st
lien RCF reflects the creditors 1st lien claim over a security
package consisting of shares from operating subsidiaries
accounting for at least 80% of group EBITDA. However the security
package is seen as weak given the access to shares only rather
than to all assets of the operating subsidiaries. The Caa1 rating
assigned to the senior secured 2nd lien notes reflects the 2nd
lien claim over the same security package.
WHAT COULD CHANGE THE RATING UP / DOWN
The proposed rating trigger reflect Moody's working assumption
that Nidda BondCo will be able to implement a squeeze out of all
minority shareholders and will own indirectly 100% of the shares
in Stada Arzneimittel AG. Moody's would be adjusting Moody's
guidance (tighter credit metrics requirements) if Nidda BondCo
would fail to fully own the company in the short term whilst
still fully consolidating it in its accounts.
Positive rating pressure is unlikely in the short term given the
weak rating positioning of Nidda BondCo at closing of the
acquisition. Over time a reduction in leverage as measured by
adjusted Debt/EBITDA sustainably below 5.0x would lead to
positive rating pressure on the rating.
Negative pressure on the rating would develop if Nidda BondCo
would fail to swiftly reduce leverage as measured by adjusted
debt/EBITDA to sustainably below 6.0x at the latest 18 to 24
months after the closing of the acquisition supported by a
recovery in the underlying operating performance in 2017 and
beyond as well as by the execution of cost reduction measures to
be implemented over the next 24 months. There is little or no
headroom for further debt financed acquisitions prior to
achievement of envisaged cost synergies especially if these
acquisitions are funded from funds raised to acquire 100% shares
in Stada Arzneimittel AG. The buyout of minority shareholders
through the issuance of additional debt could also lead to
negative pressure on the current rating.
The principal methodology used in these ratings was
Pharmaceutical Industry published in June 2017.
=============
I R E L A N D
=============
EURO-GALAXY VI: Moody's Assigns (P)B2 Rating to Cl. F Sr. Notes
---------------------------------------------------------------
Moody's Investors Service announced that it has assigned the
following provisional ratings to notes to be issued by Euro-
Galaxy VI CLO Designated Activity Company (the "Issuer" or "
Euro-Galaxy VI "):
-- EUR245,500,000 Class A Senior Secured Floating Rate Notes due
2031, Assigned (P)Aaa (sf)
-- EUR30,500,000 Class B-1 Senior Secured Floating Rate Notes
due 2031, Assigned (P)Aa2 (sf)
-- EUR12,000,000 Class B-2 Senior Secured Fixed Rate Notes due
2031, Assigned (P)Aa2 (sf)
-- EUR22,000,000 Class C Senior Secured Deferrable Floating Rate
Notes due 2031, Assigned (P)A2 (sf)
-- EUR22,500,000 Class D Senior Secured Deferrable Floating Rate
Notes due 2031, Assigned (P)Baa2 (sf)
-- EUR27,500,000 Class E Senior Secured Deferrable Floating Rate
Notes due 2031, Assigned (P)Ba2 (sf)
-- EUR12,000,000 Class F Senior Secured Deferrable Floating Rate
Notes due 2031, Assigned (P)B2 (sf)
Moody's issues provisional ratings in advance of the final sale
of financial instruments, but these ratings only represent
Moody's preliminary credit opinions. Upon a conclusive review of
a transaction and associated documentation, Moody's will
endeavour to assign definitive ratings. A definitive rating (if
any) may differ from a provisional rating.
RATINGS RATIONALE
Moody's provisional rating of the rated notes addresses the
expected loss posed to noteholders by the legal final maturity of
the notes in 2031. The provisional ratings reflect the risks due
to defaults on the underlying portfolio of loans given the
characteristics and eligibility criteria of the constituent
assets, the relevant portfolio tests and covenants as well as the
transaction's capital and legal structure. Furthermore, Moody's
is of the opinion that the collateral manager, PineBridge
Investments Europe Limited ("PineBridge"), has sufficient
experience and operational capacity and is capable of managing
this CLO.
Euro-Galaxy VI is a managed cash flow CLO. At least 90% of the
portfolio must consist of senior secured loans and secured senior
bonds and up to 10% of the portfolio may consist of unsecured
senior obligations, second-lien loans, mezzanine obligations and
high yield bonds. The portfolio is expected to be approximately
at least 70% ramped up as of the closing date and to be comprised
predominantly of corporate loans to obligors domiciled in Western
Europe.
PineBridge manages the CLO. It directs the selection, acquisition
and disposition of collateral on behalf of the Issuer and may
engage in trading activity, including discretionary trading,
during the transaction's reinvestment period, which ends in 2022.
Thereafter, purchases are permitted using principal proceeds from
unscheduled principal payments and proceeds from sales of credit
impaired and credit improved obligations, and are subject to
certain restrictions.
In addition to the seven classes of notes rated by Moody's, the
Issuer will issue EUR39,000,000 of Subordinated Notes, which will
not be rated.
The transaction incorporates interest and par coverage tests
which, if triggered, divert interest and principal proceeds to
pay down the notes in order of seniority.
Factors that would lead to an upgrade or downgrade of the
ratings:
The rated notes' performance is subject to uncertainty. The
notes' performance is sensitive to the performance of the
underlying portfolio, which in turn depends on economic and
credit conditions that may change. PineBridge's investment
decisions and management of the transaction will also affect the
notes' performance.
Loss and Cash Flow Analysis:
Moody's modeled the transaction using a cash flow model based on
the Binomial Expansion Technique, as described in Section 2.3.2.1
of the "Moody's Global Approach to Rating Collateralized Loan
Obligations" rating methodology published in August 2017.
The cash flow model evaluates all default scenarios that are then
weighted considering the probabilities of the binomial
distribution assumed for the portfolio default rate. In each
default scenario, the corresponding loss for each class of notes
is calculated given the incoming cash flows from the assets and
the outgoing payments to third parties and noteholders.
Therefore, the expected loss or EL for each tranche is the sum
product of (i) the probability of occurrence of each default
scenario and (ii) the loss derived from the cash flow model in
each default scenario for each tranche. As such, Moody's
encompasses the assessment of stressed scenarios.
The key model inputs Moody's used in its analysis, such as par,
weighted average rating factor, diversity score and the weighted
average recovery rate, are based on its published methodology and
could differ from the trustee's reported numbers. For modeling
purposes, Moody's used the following base-case assumptions:
Par amount: EUR400,000,000
Diversity Score: 40
Weighted Average Rating Factor (WARF): 2800
Weighted Average Spread (WAS): 3.55%
Weighted Average Coupon (WAC): 5.00%
Weighted Average Recovery Rate (WARR): 42.00%
Weighted Average Life (WAL): 8.5 years
As part of the base case, Moody's has addressed the potential
exposure to obligors domiciled in countries with local a currency
country risk ceiling (LCC) of A1 or below. As per the portfolio
constraints, exposures to countries with a LCC of A1 or below
cannot exceed 10%, with exposures to countries with LCCs of Baa1
to Baa3 further limited to 5%. Following the effective date, and
given these portfolio constraints and the current sovereign
ratings of eligible countries, the total exposure to countries
with a LCC of A1 or below may not exceed 10% of the total
portfolio. As a worst case scenario, a maximum 5% of the pool
would be domiciled in countries with LCCs of Baa1 to Baa3 while
an additional 5% would be domiciled in countries with LCCs of A1
to A3. The remainder of the pool will be domiciled in countries
which currently have a LCC of Aa3 and above. Given this portfolio
composition, the model was run with different target par amounts
depending on the target rating of each class of notes as further
described in the methodology. The portfolio haircuts are a
function of the exposure size to countries with a LCC of A1 or
below and the target ratings of the rated notes, and amount to
0.75% for the Class A Notes, 0.50% for the Class B Notes, 0.375%
for the Class C Notes and 0% for Classes D, E and F.
Stress Scenarios:
Together with the set of modeling assumptions above, Moody's
conducted additional sensitivity analysis, which was an important
component in determining the provisional rating assigned to the
rated notes. This sensitivity analysis includes increased default
probability relative to the base case. Below is a summary of the
impact of an increase in default probability (expressed in terms
of WARF level) on each of the rated notes (shown in terms of the
number of notch difference versus the current model output,
whereby a negative difference corresponds to higher expected
losses), holding all other factors equal:
Percentage Change in WARF: WARF + 15% (to 3220 from 2800)
Ratings Impact in Rating Notches:
Class A Senior Secured Floating Rate Notes: 0
Class B-1 Senior Secured Floating Rate Notes: -2
Class B-2 Senior Secured Fixed Rate Notes: -2
Class C Senior Secured Deferrable Floating Rate Notes: -2
Class D Senior Secured Deferrable Floating Rate Notes: -1
Class E Senior Secured Deferrable Floating Rate Notes: 0
Class F Senior Secured Deferrable Floating Rate Notes: 0
Percentage Change in WARF: WARF +30% (to 3640 from 2800)
Ratings Impact in Rating Notches:
Class A Senior Secured Floating Rate Notes: -1
Class B-1 Senior Secured Floating Rate Notes: -3
Class B-2 Senior Secured Fixed Rate Notes: -3
Class C Senior Secured Deferrable Floating Rate Notes: -3
Class D Senior Secured Deferrable Floating Rate Notes: -2
Class E Senior Secured Deferrable Floating Rate Notes: -1
Class F Senior Secured Deferrable Floating Rate Notes: -1
Methodology Underlying the Rating Action:
The principal methodology used in these ratings was "Moody's
Global Approach to Rating Collateralized Loan Obligations"
published in August 2017.
GTLK EUROPE: Moody's Rates New US Dollar Sr. Unsec. Notes (P)Ba3
----------------------------------------------------------------
Moody's Investors Service has assigned a provisional rating of
(P)Ba3 to the proposed US dollar-denominated senior unsecured
notes to be issued by GTLK Europe Capital DAC, an Ireland-based
company which is a wholly-owned direct subsidiary of GTLK Europe
DAC (GTLKE) and is ultimately owned by Russian State Transport
Leasing Company PJSC (STLC, Ba2 positive)
The outlook assigned to the rating is positive.
The maturity, the size and the pricing of the notes are subject
to prevailing market conditions during placement.
The notes will be unconditionally and irrevocably guaranteed, on
a joint and several basis, by STLC and GTLKE, and the proceeds of
the notes will be utilized for general corporate purposes and
repayment of existing debt.
RATINGS RATIONALE
The (P)Ba3 rating assigned to the proposed notes is one notch
below STLC's corporate family rating (CFR) of Ba2, which reflects
their structural subordination to STLC's substantial amount of
secured debt. The senior unsecured notes have a lower relative
priority of claim than STLC's secured instruments on a high
percentage of the company's earning assets.
The notes issued by GTLK Europe Capital DAC are unconditionally
and irrevocably guaranteed, on a joint and several basis, by STLC
and GTLKE (a wholly owned and consolidated subsidiary of STLC)
and will rank pari passu with the other unsecured and
unsubordinated financial debt of STLC.
According to the terms and conditions of the notes, the investors
will benefit from certain covenants including a negative pledge,
restrictions on mergers and transactions with affiliates. In
addition, STLC -- as an ultimate parent guarantor -- is obliged
to maintain a positive net interest income and ratio of equity to
assets at a minimum pre-specified level of 10%.
Moody's issues provisional rating in advance of the final sale of
securities and these rating reflects Moody's preliminary credit
opinion regarding the transaction only. Upon a conclusive review
of the final documentation, Moody's will endeavor to assign a
final rating to the notes. A definitive rating may differ from a
provisional rating.
RATIONALE FOR POSITIVE OUTLOOK
The positive outlook on the ratings reflects the positive outlook
on the STLC's CFR rating.
WHAT COULD CHANGE THE RATING UP/DOWN
Given the positive outlook, an upgrade is likely over the next
12-18 months. However, in the longer term should STLC further
reduce its reliance on secured debt, resulting in fewer
encumbered assets and a materially higher proportion of senior
unsecured debt in its capital structure, Moody's could equalize
the company's senior unsecured rating with its corporate family
rating. Negative pressure could be exerted on the debt rating as
a result of material deterioration in the company's stand-alone
credit profile or Moody's perception of a reduced probability of
government support for the company.
LIST OF ASSIGNED RATINGS
Issuer: GTLK Europe Capital DAC
Assignments:
-- BACKED Senior Unsecured Regular Bond/Debenture, Assigned
(P)Ba3
Outlook Actions:
-- Outlook, Assigned Positive
PRINCIPAL METHODOLOGY
The methodologies used in this rating were Finance Companies
published in December 2016, and Government-Related Issuers
published in August 2017.
GTLK EUROPE: Fitch Rates Upcoming Guaranteed Notes 'BB(EXP)'
------------------------------------------------------------
Fitch Ratings has assigned Ireland-based GTLK Europe Capital
DAC's upcoming issue of USD-denominated guaranteed notes an
expected 'BB(EXP)' rating. The final rating is contingent upon
the receipt of final documents conforming to information already
received.
GTLK Europe Capital is a financing special purpose entity of GTLK
Europe DAC (GTLK Europe), an Irish subsidiary of Russia-based
PJSC State Transport Leasing Company (STLC, BB/Positive). GTLK
Europe has been established as an operating entity utilising the
favourable tax and regulatory regimes of Ireland for the leasing
of aircraft and ships. The notes will represent direct,
unsubordinated and unsecured obligations of GTLK Europe Capital
and will benefit from unconditional and irrevocable, joint and
several guarantees from both of STLC and GTLK Europe.
The proceeds will be used mainly for general corporate purposes
including refinancing current outstanding USD-denominated
borrowings.
The facility agreement includes financial covenants relating to
STLC (e.g. maintenance of positive net interest income, including
operating lease income, and an equity-to-assets ratio of above
10%). The terms of the issue also provide noteholders with a put
option in case of the Russian sovereign (BBB-/Positive) ceasing
to control more than 75% of STLC's and/or GTLK Europe's equity.
Both companies are currently ultimately controlled by the Russian
government, which is represented by the Ministry of Transport.
KEY RATING DRIVERS
The notes' rating is equalised with STLC's Long-Term Foreign-
Currency Issuer Default Rating (IDR), reflecting Fitch's view
that STLC, if required, would have a very strong propensity to
honour the obligation under the guarantee due to its publicly
expressed commitment to do so, and potential reputational damage
from not honouring the obligation.
STLC's Long-Term IDR in turn reflects Fitch's view of a moderate
probability of support for the company, if needed, from the
Russian sovereign.
RATING SENSITIVITIES
The rating of the issue is likely to move in tandem with STLC's
Long-Term Foreign-Currency IDR, which currently has a Positive
Outlook.
ST. PAUL'S CLO III-R: Fitch Rates Class F-R Notes 'B-sf'
--------------------------------------------------------
Fitch Ratings has assigned St. Paul's CLO III-R DAC refinancing
notes final ratings, as follows:
Class A-R: 'AAAsf'; Outlook Stable
Class B-1-R: 'AAsf'; Outlook Stable
Class B-2-R: 'AAsf'; Outlook Stable
Class C-R: 'Asf'; Outlook Stable
Class D-R: 'BBBsf'; Outlook Stable
Class E-R: 'BBsf'; Outlook Stable
Class F-R: 'B-sf'; Outlook Stable
Subordinated-R notes: not rated
St. Paul's CLO III-R DAC is a securitisation of mainly senior
secured loans (at least 90%) with a component of senior
unsecured, mezzanine, and second-lien loans. This transaction is
a reissue of St. Paul's CLO III DAC where the original portfolio
has been transferred (transfer to legal title) to a new SPV, St.
Paul's CLO III-R. The old notes will be repaid using the proceeds
of the new notes. A total note issuance of EUR562.6 million was
used to fund a portfolio with a target par of EUR550 million. The
portfolio is actively managed by Intermediate Capital Managers
Limited, a wholly owned subsidiary of Intermediate Capital Group
plc (ICG). The transaction has a four-year reinvestment period,
which is scheduled to end in 2022.
KEY RATING DRIVERS
'B' Portfolio Credit Quality
Fitch views the average credit quality of obligors to be in the
'B' range. The Fitch-weighted average rating factor (WARF) of the
current portfolio is 33.84, below the indicative maximum covenant
of 35 for assigning the ratings.
High Recovery Expectations
At least 90% of the portfolio will comprise senior secured
obligations. Fitch views the recovery prospects for these assets
as more favourable than for second-lien, unsecured and mezzanine
assets. The Fitch-weighted average recovery rate of the current
portfolio is 66.8%, above the minimum covenant of 62.9% for
assigning the ratings.
Limited Interest Rate Exposure
Up to 10% of the portfolio can be invested in fixed-rate assets,
while there are 3.34% fixed-rate liabilities. Fitch modelled both
0% and 10% fixed-rate buckets and found that the rated notes can
withstand the interest rate mismatch associated with each
scenario.
Diversified Asset Portfolio
The covenanted maximum exposure to the top 10 obligors for
assigning the ratings is 21% of the portfolio balance. This
covenant ensures that the asset portfolio will not be exposed to
excessive obligor concentration.
VARIATIONS FROM CRITERIA
The "Fitch Ratings Definitions" was amended so that assets that
are not rated by Fitch but rated privately by the other agency
rating the liabilities, can be assumed to be of 'B-' credit
quality for up to 10% of the aggregated portfolio notional. This
is a variation from Fitch's criteria, which requires all assets
unrated by Fitch and without public ratings to be treated as
'CCC'. The change was motivated by Fitch's policy change of no
longer providing credit opinions for EMEA companies over a
certain size. Instead Fitch expects to provide private ratings
that would remove the need for the manager to treat assets under
this leg of the "Fitch Rating Definition".
The amendment has only a small impact on the ratings. Fitch has
modelled the transaction at the pricing point with 10% of the 'B-
' assets with a 'CCC' rating instead, which resulted in a two-
notch downgrade at the 'A' rating level and one-notch downgrade
or no impact at all other rating levels.
RATING SENSITIVITIES
A 125% default multiplier applied to the portfolio's mean default
rate, and with this increase added to all rating default levels,
would lead to a downgrade of up to two notches for the rated
notes. A 25% reduction in recovery rates would lead to a
downgrade of up to four notches at the 'BB' rating level and two
notches for all other rating levels.
=================
M A C E D O N I A
=================
PROCREDIT BANK: Fitch Changes Outlook to Pos., Affirms BB+ IDRs
---------------------------------------------------------------
Fitch Ratings has revised the ProCredit Bank AD Skopje's (PCBM)
Outlook to Positive from Negative while affirming the bank's
Long-Term Foreign- and Local-Currency Issuer Default Ratings
(IDRs) at 'BB+'. The bank's Viability Rating is unaffected by
this rating action.
The revision of Outlooks on the bank's IDRs follows Fitch's
recent revision of Outlook on Macedonian sovereign.
KEY RATING DRIVERS
IDRS AND SUPPORT RATING
PCBM's IDRs and Support Rating are driven by the support the bank
may receive from ProCredit Holding AG&Co. KGaA (PCH, BBB/Stable),
its 100% owner. Support considerations include the strategic
importance of south-east Europe to PCH and the negative
implications of a subsidiary default for the group.
However, the extent to which such support can be factored into
the ratings is constrained by the Macedonia Country Ceiling of
'BB+'. Absent of this constraint, support considerations would
typically be reflected in a one-notch differential between the
rating of the parent, PCH, and PCBM. The Positive Outlook
reflects that on the sovereign.
RATING SENSITIVITIES
IDRS AND SUPPORT RATING
Changes in Macedonia's Country Ceiling could result in changes to
PCBM's IDRs. The Positive Outlook on the bank reflects the
greater potential of an upgrade, driven by the Positive Outlook
on the sovereign.
The rating actions are as follows:
PCBM
Long-Term Foreign- and Local-Currency IDRs affirmed at 'BB+';
Outlook revised to Positive from Negative
Short-Term Foreign- and Local-Currency IDRs affirmed at 'B'
Support Rating affirmed at '3'
Viability Rating of 'b+' is unaffected
=====================
N E T H E R L A N D S
=====================
LOWLAND MORTGAGE 3: Fitch Lowers Cl. D Debt Rating to 'BB-sf'
-------------------------------------------------------------
Fitch Ratings has upgraded four, downgraded two and affirmed nine
tranches of three Lowland Mortgage Backed Securities
transactions. All 15 tranches were removed from Rating Watch
Evolving (RWE) and assigned Stable Outlooks. The rating actions
are as follows:
Lowland Mortgage Backed Securities 2 B.V. (LL2)
Class A1 (XS0887366135) affirmed at 'AAAsf'; off RWE; Outlook
Stable
Class A2 (XS0887366481) affirmed at 'AAAsf'; off RWE; Outlook
Stable
Class B (XS0887378064) upgraded to 'AA+sf' from 'AAsf'; off RWE;
Outlook Stable
Class C (XS0887378577) affirmed at 'Asf'; off RWE; Outlook Stable
Class D (XS0887378908) upgraded to 'BB+sf' from 'BBsf'; off RWE;
Outlook Stable
Lowland Mortgage Backed Securities 3 B.V. (LL3)
Class A1 (XS0988484878) affirmed at 'AAAsf'; off RWE; Outlook
Stable
Class A2 (XS0988486493) affirmed at 'AAAsf'; off RWE; Outlook
Stable
Class B (XS0988487202) affirmed at 'Asf'; off RWE; Outlook Stable
Class C (XS0988487970) downgraded to 'BB+sf' from 'BBB+sf'; off
RWE; Outlook Stable
Class D (XS0988488606) downgraded to 'BB-sf' from 'BBB-sf'; off
RWE; Outlook Stable
Lowland Mortgage Backed Securities 4 B.V. (LL4)
Class A1 (XS1551596775) affirmed at 'AAAsf'; off RWE; Outlook
Stable
Class A2 (XS1551596858) affirmed at 'AAAsf'; off RWE; Outlook
Stable
Class B (XS1551596932): affirmed at 'AAAsf'; off RWE; Outlook
Stable
Class C (XS1551597070): upgraded to 'AA+sf' from 'A-sf'; off RWE;
Outlook Stable
Class D (XS1551597153): upgraded to 'Asf' from 'BBsf'; off RWE;
Outlook Stable
The mortgages in the transactions were originated and are
serviced by de Volksbank N.V. (A-/Stable/F2).
KEY RATING DRIVERS
European RMBS Rating Criteria
The application of the new European RMBS Rating Criteria has led
to smaller expected losses for LL2 and LL4, leading to the
upgrade of the ratings on the respective tranches. Meanwhile
credit enhancement available to the class C and D notes for LL3
was not sufficient to withstand Fitch's updated criteria
assumptions, resulting in their respective downgrades.
The updated analysis has resulted in model-implied ratings that
are one notch below the current ratings of the class A1, A2 and B
notes of LL3 and the class C notes of LL2. In line with its
criteria, Fitch affirmed the ratings on these notes as it expects
that the model-implied ratings in future model updates will
converge to the level of the current ratings.
Originator Adjustment
Fitch's base default probabilities assume that origination,
underwriting and servicing practices and procedures are in line
with those of a standard traditional Dutch lender, with market
expertise and relevant management experience. In the rating
analysis of these transactions Fitch applied an originator
adjustment by increasing the weighted average foreclosure
frequency (WAFF) by 20%.
Five-year Revolving Period in LL4
The LL4 structure includes a revolving period during which new
assets can be added to the portfolio. The revolving period is due
to end in January 2022. Therefore, Fitch based its analysis on a
stressed portfolio composition by incorporating the additional
purchase criteria, rather than focusing on the actual portfolio
characteristics.
Stabilising Arrears
According to the investor reports for October 2017, loans with
more than three monthly payments overdue decreased to 26bp from
34bp (LL2) and to 38bp from 44bp (LL3) of the current portfolio
balance since December 2016. Meanwhile, given that the LL4
transaction closed in 2017, loans in arrears by more than three
months started to materialise and increased to 7bp from zero.
RATING SENSITIVITIES
An increase in new defaults and associated pressure on excess
spread levels, beyond Fitch's assumptions, could result in
negative rating action, particularly for the junior tranches.
===========
S E R B I A
===========
TARGO TELEKOM: March 22 Bid Submission Deadline Set
---------------------------------------------------
Pursuant to the Bankruptcy Proceedings Decision made by the
bankruptcy judge of the Commercial court in Belgrade, business
bankruptcy case number 121/2015 dated May 16, 2016, and in
accordance with the Articles 131, 132, 133 and 135 of the
Bankruptcy Law ("Official Gazette of the Republic of Serbia"
No. 104/2009, 99/2011, 71/2012 and 83/2014) and the National
Standard on Manner and Procedure of Converting Assets of the
Bankruptcy Debtor into Cash - National Standard No.5 ("Official
Gazette of the Republic of Serbia" No. 104/2009), bankruptcy
administrator of the bankruptcy debtor
TARGO TELEKOM DOO BEOGRAD - in bankruptcy proceedings, 12/3
Djordja Stanojevica, Belgrade
Registration number: 20525134
ADVERTISES
The sale of the bankruptcy debtor as a legal entity through
public bidding
The subject of sale is the bankruptcy debtor as a legal entity in
accordance with an expert's assessment as of September 30, 2016,
where the most important property of the bankruptcy debtor
comprises of:
1. Optic cables network in the territory of the city of Belgrade
(municipalities: New Belgrade, Zemun, Stari grad, Savski venac,
Palilula, Vozdovac, Zvezdara, Vracar), with delivering the optics
to the end-users on the territory of New Belgrade and Zemun.
2. Network of optic cables spread out on the territory of the
Republic of Serbia, placed along highways and partly along the
main roads.
LOCATION
1. Batrovci - Belgrade (Airport)
2. Belgrade (Airport)- Belgrade Autokomanda
3. Belgrade (Batajnica) - Horgos
4. Batajnica - Belgrade (Petlja Novi Sad)
5. Belgrade (Bubanj potok)-Presevo I part of the route
6. Belgrade (Bubanj potok)- Presevo II part of the route
7. Belgrade (Autokomanda)- Bubanj potok
8. Nis - Dimitrovgrad
Description and specification of the bankruptcy debtor's overall
property as well as review of the sale subject is given in detail
in the sales documentation.
Starting price equals EUR31,671,529
Deposit amounts to 20% of estimated value, i.e.
RSD752,515,529.00
Public bidding will be held on March 29, 2018, at 12:00 in the
premises of the bankruptcy debtor, at the following address: 12/3
Djordja Stanojevica, Belgrade.
All legal and natural entities, domestic and foreign persons have
the right to participate in the public bidding. Conditions for
participation in the public bidding are as follows:
1. Buyout of sales documentation in the amount of RSD370,000.00 +
VAT. The pro-forma invoice may be obtained every working day in
the period from 10 to 15 hours with required announcing to the
bankruptcy administrator, and also may be asked for via following
e-mail address:miroska.radovicsu@gmail.com. Based on the buyout
of the sales documentation, and upon signing of the
Confidentiality Agreement, accesses to the VDR (Virtual Data
Room) will be approved as well.
2. Making a deposit in the amount of RSD752,515,529.00 to the
current account of the bankruptcy debtor: 160-428807-69 in the
Banca Intesa, at the latest three days prior to the public
bidding (deposit payment deadline is 26 March 2018), or by
submitting first-class bank guarantee at the first call for bids.
In the case that first-class bank guarantee is submitted as a
deposit, its original must be delivered for verification --
exclusively in person -- to the bankruptcy administrator along
with the Application Form, not later than 22 March 2018 until
15:00.
3. Signing a Confidentiality Agreement.
4. Signing a Statement of waiving right of the deposit to be
returned. The Statement is a component of sales documentation.
The bankruptcy debtor as a legal entity shall be bought as is and
it can be viewed at the latest 7 days before scheduled sale and
after buyout of sales documentation every working day from 10:00
to 13:00 with prior announcing to the bankruptcy administrator.
After making a deposit at the latest three working days before
public bidding is held (closing on 26 March 2018), for timely
records, potential buyers have to submit to the bankruptcy
administrator the Public Bidding Application Form, signed
Statement of waiving right of deposit to be returned, an Excerpt
from the Business Registers Agency and OP form (certified
signature of the person authorized and in charge of
representation of a legal entity), while in case of other person
being an authorized representative, Power of Attorney certified
by authorities must be provided.
Registration of the participants starts two hours prior to the
public bid beginning and ends 10 minutes prior to the public bid
beginning, i.e. from 10:00 to 11:50 at the address of the
debtor's premises - 12/3 Djordja Stanojevica, Belgrade.
The bankruptcy administrator shall conduct the public auction by:
1. Registering persons entitled to take part in the auction;
2. Opening the public auction by reading the rules of the
auction;
3. Inviting participants to offer the price they are willing to
pay;
4. Maintaining order at the auction;
5. Announcing the buyer when no other party offers a price higher
than the last price offered;
6. Signing the minutes.
If the winning bidder is the Buyer who secure deposit by a bank
guarantee, the person is obliged to provide deposit amount within
72 hours since the public bid occuring, and prior to the
verification of the sales agreement, after which bank guarantee
will be returned.
Sales agreement shall be signed within 5 working days since the
public bid occuring, under condition that deposit money is paid
to the account of the bankruptcy debtor when secured by a bank
guarantee. After selling of the bankruptcy debtor as a legal
entity, bankruptcy proceedings related to the debtor shall be
closed, and it shall be continued in relation to the bankruptcy
estate. Neither the bankruptcy debtor nor the buyer shall be
responsible to the creditors for the liabilities occured until
closing of the the bankruptcy proceedings. The proclaimed Buyer
is obliged to transfer the remaining amount of money of the sale
price within 20 days since the day of signing the sales
agreement. Only after the Buyer pays sale price and the debtor
confirms the whole payment has been transferred to its account,
can the Buyer get the right to make changes in the business
entities register, as well as with other competent authorities.
Every person entitled to participate in the bidding according to
the conditions regulated by this advertisement, loses right to
deposit in accordance with the Statement of waiving their right
for the deposit to be returned, and under conditions stipulated
in the National standard. If the proclaimed Buyer does not sign
the minutes, sales agreement or fails to pay sale price within
defined terms and manner, as well as in all other cases foreseen
by the Statement of waiving right for the deposit to be returned,
the proclaimed Buyer loses right to get deposit back, and the
second-highest bidder will be proclaimed the Buyer. If the
second-highest bidder at the public bidding secured deposit by a
bank guarantee, after withdrawing of the proclaimed Buyer, he has
to pay deposit amount to the bank account of the bankruptcy
debtor within two days after receiving notice of announcement,
after which his guarantee will be returned. In this case, the
sales agreement will be signed within 3 working days since the
receiving notice of announcing the second-highest bidder as the
Buyer.
Participant who don't acquire the status of the Buyer or the
second-highest bidder at the public bidding, will be returned
their deposit within 8 days since public bid occuring date.
Tax, notary fees for contract verification as well as all other
expenses derived from the signed sales agreement shall be
completely borne by the buyer.
In case of announcing a buyer in the selling procedure to be a
legal or natural person obliged to submit notification on
concetration, pursuant to the Law on Protection of Competition
(Official Gazette of the RS, no. 51/2009 and 95/2013), terms and
deadlines for signing a contract will be adjusted to the
deadlines for making decision by the Committee for the Protection
of Competition. In the given case, proclaimed buyer's bank
guarantee will be paid according to the schedule envisaged by the
advertisement, i.e. deposit will be retained until decision is
made by the Committee for the Protection of Competition. The
second-highest bidder will not be returned deposit or the bank
guarantee (if the deposit amount is secured by a bank guarantee)
until decision on submitted notification is made by the Committee
for the Protection of Competition. In this case, guarantee's
period of validity must be 60 days at least.
The authorized person is:
Miroska Radovic
Bankruptcy Administrator
Phone: +381 69 11 688 49
E-mail: miroska.radovicsu@gmail.com
=====================
S W I T Z E R L A N D
=====================
SCHMOLZ + BICKENBACH: S&P Affirms B+ CCR, Alters Outlook to Neg.
----------------------------------------------------------------
S&P Global Ratings said that it revised its outlook on Swiss
specialty steel producer Schmolz + Bickenbach AG (S+B) to
negative from stable. S&P also affirmed its 'B+' long-term
corporate credit rating on the company.
S&P said, "At the same time, we affirmed our 'B+' issue-level
rating on the EUR200 million senior secured notes due 2022 issued
by Schmolz + Bickenbach Luxembourg Finance S.A. The recovery
rating on the notes is '4', indicating our expectation for
average recovery (30%-50%; rounded estimate: 35%) in the event of
a payment default.
"The revision of the outlook to negative from stable reflects the
possibility that following S+B's acquisition of most of Asco
Industries' plants (all except Ascoval), S+B's leverage could
increase to about 5x in 2018 compared with our target of about 4x
for the rating. This is despite the potential synergies between
the two companies and S+B's strong performance in 2017, with
estimated adjusted EBITDA of EUR220 million and debt to EBITDA
falling to 3.7x from 7.4x in 2016. We continue to assess S+B's
liquidity as strong, albeit with reduced covenant headroom under
our revised base case."
The expected negative impact on credit metrics results from S+B
having to bear Asco's losses while investing substantially in its
operating assets, hoping to reap the benefits of cost synergies
and a wider sales network within the next two to three years. To
cover the additional cash outflows, the company will initially
draw on available revolving credit facility (RCF) lines and
include Asco's receivables in its asset-backed securities (ABS)
financing program. As a result, under S&P's base case, leverage
will peak in 2018 at nearly 5x.
S&P said, "For 2018, we are assuming broadly stable market
conditions, with GDP growth in S+B's key European markets at
about 2% compared with approximately 2.3% in 2017. Nevertheless,
volatile electrodes and refractories prices could hurt the
company's operating performance. Furthermore, raw material prices
remain volatile. Although the company expects to incur no more
restructuring costs (excluding those in relation to the Asco
acquisition), its cost-savings efforts are still ongoing (at DEW
and Steeltec in particular), with a further EUR20 million of cost
savings expected in the medium term after EUR70 million achieved
in 2016-2017. Our base case points to 2018 pro forma adjusted
EBITDA of about EUR190 million.
"Our view of S+B's business risk profile as weak is constrained
by the inherent volatility of the steel industry and the
company's exposure to cyclical end-markets. We continue to factor
in limited visibility on prices and earnings as well as the
industry's inherently high fixed-cost base, which is currently
one of S+B's key strategic focuses. Measures to decrease the
fixed-cost base have included reducing headcount through various
means, relocating and closing assets, decreasing bottlenecks, and
optimizing capacity. Although we capture these costs in our
adjusted EBITDA figure, we anticipate that a large proportion
will be nonrecurring and will contribute to improving S+B's
operating efficiency in the long term. The acquisition of Asco
Industries' assets is expected to contribute to this further
through cost synergies and improved capacity utilization while
also providing growth opportunities."
S+B's free operating cash flow (FOCF) is expected to come out
slightly negative in 2017, in particular due to price and volume
growth increasing working-capital requirements. Its FOCF should
be deeper into negative territory in 2018, as the acquisition
will significantly affect its cash position. On a stand-alone
basis, capex is due to increase to about EUR130 million from
close to EUR100 million in 2017, owing to strategic investments
such as the walking beam furnace at Swiss Steel. A further EUR30
million related to Asco Industries is expected. Overall, the
company expects to invest EUR80 million in capex over 2018-2021
in connection to Asco asset integration. Similarly, S+B's
investment in working capital is estimated at EUR85 million,
while a EUR50 million cash consideration is intended to cover
payments to leasing companies and Asco's bondholders. S&P expects
S+B to finance these cash outflows through its RCF and working
capital bridge loan, while also using the ABS financing program
for inclusion of Asco's receivables.
S&P said, "We revised our assessment of S+B's financial risk
profile to highly leveraged from aggressive on account of the
higher leverage and our view of current market conditions as very
strong in a highly cyclical industry. We continue to adjust
reported debt for pensions of about EUR300 million and operating
leases of about EUR19 million."
S&P's base case (stand-alone S+B for 2017 and pro forma the
acquisition for 2018) assumes:
-- Volume growth of 4% in 2017 and 28% in 2018;
-- High-single-digit percent growth in the realized average
steel price in 2017 versus 2016 and slight growth thereafter;
-- Nickel price assumption of $10,500/ton in 2017 and
$11,000/ton in 2018;
-- Restructuring costs of EUR8 million in 2017 and EUR25 million
in 2018;
-- Significant working capital build-up in both years; and
-- Capex of EUR105 million in 2017 and EUR160 million in 2018.
Based on these assumptions, S&P arrives at the following credit
measures (again, stand-alone S+B for 2017 and pro forma the
acquisition for 2018):
-- Adjusted EBITDA of about EUR220 million in 2017 and EUR190
in 2018 compared with EUR110 million (after EUR40 million
restructuring) in 2016;
-- Adjusted debt to EBITDA of about 3.7x in 2017 and
approximately 4.9x in 2018 compared with 7.4x in 2016;
-- FFO to debt of about 22% in 2017 and approximately 15% in
2018 compared with 7% in the previous year; and
-- Slightly negative free cash flow in 2017, becoming more
clearly negative in 2018.
The negative outlook reflects the risk that following the Asco
acquisition, S+B's leverage might not revert back to about 4x
over the coming two years, the target for the given rating. S&P
expects that despite the favorable industrial rationale and
potential synergies, S+B's EBITDA and cash generation will likely
decline over the next two years. Together with a moderate
increase in financial debt, this would lead to significantly
weaker credit metrics in 2018, improving from 2019 onwards.
S&P said, "We also view the acquisition as bearing some execution
risk, as the assets require restructuring, and all the expected
synergies might not be achieved. Furthermore, we could downgrade
S+B if we no longer viewed its liquidity as strong.
"We could consider revising the outlook back to stable if the
company demonstrates a clear path to achieving debt to EBITDA of
about 4.0x and FFO to debt of approximately 20%. We would also
expect the company to maintain strong liquidity and show positive
free cash flow generation."
===========================
U N I T E D K I N G D O M
===========================
CARILLION PLC: Accountancy Firms Face Questions Over Audits
-----------------------------------------------------------
Alistair Smout at Reuters reports that British lawmakers on
Feb. 13 said KPMG and other leading accountancy firms face
serious questions over their work with failed construction firm
Carillion after making millions of pounds out of their
relationships with the company.
Lawmakers from two parliamentary committees examining the
collapse of Carillion said that KPMG had earned GBP29.4 million
(US$41 million) from auditing the contractor's accounts since the
company was founded in 1999, Reuters relates.
The firm signed off on Carillion's 2016 accounts, shortly before
the construction and outsourcing company announced a string of
profit warnings, Reuters notes. Carillion collapsed last month
with debts of over GBP2 billion, Reuters recounts.
"KPMG has serious questions to answer about the collapse of
Carillion. Either KPMG failed to spot the warning signs, or its
judgment was clouded by its cozy relationship with the company
and the multi-million pound fees it received," Reuters quotes
Rachel Reeves, chair of the Business, Energy and Industrial
Strategy (BEIS) Committee, as saying. "KPMG should, as a bare
minimum, review its processes and explain what went wrong."
KPMG, as cited by Reuters, said it would assist the inquiry into
the failure of Carillion, and will be questioned by the lawmakers
on Feb. 22.
According to Reuters, lawmakers published responses from the "Big
Four" accountancy firms to inquiries on their involvement with
Carillion on Feb. 13, saying that PwC, KPMG, Deloitte and EY had
earned GBP71 million since 2008 on work related to the firm.
Headquartered in Wolverhampton, United Kingdom, Carillion plc --
http://www.carillionplc.com/-- is an integrated support services
company. The Company operates through four business segments:
Support services, Public Private Partnership projects, Middle
East construction services and Construction services (excluding
the Middle East).
ENTERTAINMENT ONE: Moody's Affirms Ba3 CFR, Outlook Stable
----------------------------------------------------------
Moody's Investors Service has affirmed the Ba3 Corporate Family
Rating (CFR) and Ba3-PD Probability of default Rating (PDR) of
Entertainment One Ltd. ("Entertainment One" or "the company") as
well as the B1 rating of the GBP355 million Senior Secured Notes
due 2022. The outlook on all ratings is stable.
The rating action follows the announcement that the company is to
acquire the 49% minority interest it does not yet own in The Mark
Gordon Company. Total consideration of USD209 million is to be
funded by approximately GBP89 million of equity, including GBP53
million of new equity already successfully placed, and the
proceeds of a tap issue of GBP70 million on the Senior Secured
Notes due 2022. The tap issue on the existing Senior Secured
Notes will take the total amount outstanding to GBP355 million
from GBP285 million.
"Full ownership of The Mark Gordon Company is in line with
management strategy as the business transitions steadily from
distribution to content production and intellectual property
monetization. In addition, the transaction has been
conservatively financed, with a very limited impact on leverage,
and post transaction, Entertainment One remains well-positioned
in the Ba3 rating category," says Colin Vittery, a Moody's Vice
President -- Senior Credit Officer, and lead analyst for
Entertainment One.
RATINGS RATIONALE
The affirmation of Entertainment One's Ba3 CFR follows improved
performance through 2017 and the announcement of the acquisition
of the 49% minority interest in The Mark Gordon Company, which is
to be funded with a mix of equity, cash and a tap issue of GBP70
million on the existing GBP285 million Senior Secured notes due
2022. Post transaction, Moody's expects the company's debt /
EBITDA (as adjusted) for fiscal 2018 to be 3.5x, well within the
triggers for the current Ba3 rating of between 3.0x and 4.0x.
Entertainment One's Ba3 rating reflects (1) the market-leading
position in independent film distribution with strong
counterparty relationships; (2) the increasing value of its
intellectual property across film, television and family brands
(including the valuable, high margin, Peppa Pig), with a current
library valuation of USD1,700 million; (3) revenue diversity and
portfolio production strategies limit content investment risk;
(4) exposure to growth markets and increased digital revenues;
and (5) its predictable financial policy.
Entertainment One's Ba3 rating also reflects (1) the limited
scale of the business relative to major US film and television
content producers; (2) the industry-wide challenge to create new
film and television content and refresh existing formats; (3) the
retention of creative talent; (4) risk of investment loss in
development of content; (5) the potential volatility in earnings
due to the film slate and television commissioning, as well as
the seasonality in the business, which weights earnings to the
second half of the fiscal year; (6) the current, albeit reducing,
concentration of family brand earnings from the Peppa Pig asset
and (7) limited free cash flow generation given increasing
investment in production.
Moody's consider that Entertainment One has adequate liquidity.
The weighting of cash flow generation to fiscal Q4 means that
there is seasonality in working capital, which is addressed by
cash on balance sheet of GBP45 million (pro forma for The Mark
Gordon Company acquisition as of September 30, 2017) and through
access to a GBP150 million super-senior revolving credit
facility, due December 2020.
RATIONALE FOR THE STABLE OUTLOOK
The stable outlook is based on Moody's expectation that the
company will maintain strong operating momentum with credit
metrics comfortably positioned for the Ba3 rating and that the
level of restructuring costs incurred by the company will reduce
significantly in fiscal 2018.
WHAT COULD CHANGE THE RATING UP/DOWN
Upward rating pressure may arise should Entertainment One deliver
(1) Gross debt / EBITDA (as adjusted by Moody's) sustainably
below 3.0x; and (2) free cash flow (after capital spending and
dividends) is positive, also on a sustained basis.
Negative rating pressure may develop should (1) there be a marked
deterioration in operating performance; (2) gross Debt / EBITDA
be sustained above 4.0x due to debt-financed acquisitions or weak
operating results; or (3) there is continuing negative free cash
flow generation.
LIST OF AFFECTED RATINGS
Issuer: Entertainment One Ltd.
Affirmations:
-- BACKED Senior Secured Regular Bond/Debenture, Affirmed B1
-- LT Corporate Family Rating, Affirmed Ba3
-- Probability of Default Rating, Affirmed Ba3-PD
Outlook Actions:
-- Outlook, Remains Stable
PRINCIPAL METHODOLOGY
The principal methodology used in these ratings was Business and
Consumer Service Industry published in October 2016.
Entertainment One is a media content acquirer and producer, with
the aim of monetizing distribution from a global footprint and
from all major English-speaking territories. The company's
library of rights includes 80,000 hours of film and television
content and 40,000 music tracks. The company also owns 85% of the
global rights to Peppa Pig. The content library is independently
valued at USD1,700 million (as at March 31, 2017). The company is
listed on the London Stock Exchange and is a member of the FTSE
250 Index. The company's largest shareholder, Canada Pension Plan
Investment Board, holds 19.7% of the outstanding shares. In
FY2017, Entertainment One reported revenues of GBP1,083 million
and Underlying EBITDA (as calculated by management) of GBP160
million.
EXTERION MEDIA: Moody's Lowers CFR to Caa1, Outlook Negative
------------------------------------------------------------
Moody's Investors Service has downgraded Exterion Media's (rated
at Doubleplay I Ltd) corporate family rating (CFR) to Caa1 from
B3, its probability of default rating (PDR) to Caa2-PD from Caa1-
PD and the rating on the senior secured bank credit facilities
issued by Exterion Media Holdings Limited to Caa1 from B3.
Concurrently, Moody's has changed the outlook on the ratings to
negative from rating under review.
The rating action concludes the review initiated in November
2017, following the downgrade of the company's CFR to B3 from B1.
"The ratings downgrade reflects the lack of a clear and
sustainable solution to Exterion Media's very limited headroom
under the net leverage financial covenant included in its credit
facilities," says Christian Azzi, a Moody's AVP -- Analyst and
lead analyst for Exterion Media.
"While Exterion Media's performance has improved over the last
two months, visibility on operating performance of its UK
business in 2018 and demand for the company's French billboard
assets remain low. With a scheduled covenant step-down in June
2018 looming, the long-term sustainability of the current capital
structure, including maintaining access to the revolving facility
for liquidity needs, remains uncertain," says Christian Azzi, a
Moody's AVP -- Analyst and lead analyst for Exterion Media.
RATINGS RATIONALE
The downgrade of Exterion Media's CFR to Caa1 reflects the lack
of progress to date in finding a long term solution to what
Moody's perceives to be an unsustainable covenant schedule in the
company's credit facilities.
Under the current senior facilities agreement, the company has to
comply with a financial net leverage covenant of 4x in March
2018, 3.75x in June 2018 and 3.50x in December 2018. At the end
of December 2017, the company had GBP27 million of cash and GBP12
million of availability under its revolving credit facility.
There has been no change to the required covenant schedule since
the review process was initiated and while the company's
performance has stabilised over the last two months of 2017,
visibility on demand for Exterion Media's products remains very
low and subject to client's budgeting. In turn, this raises
concerns over Exterion Media's ability to comfortably meet its
covenants over the next six months and on a consistent basis
going forward. Failure to meet the covenants could restrict the
access to the company's revolving credit facility and Moody's
believes that this could lead to a restructuring of the debt that
could amount to a distressed exchange under Moody's definition.
The improvement in the company's performance in November and
December 2017 means that Moody's now expects Exterion Media's
adjusted leverage to reach around 4.3x from previous expectations
of 4.6x at year end 2017. Given the size of the company and the
concentration of UK revenue generated from four specialist OOH
buying agencies, fluctuations in overall spend by one of these
specialists could have a pronounced effect on Exterion Media's
performance and lead to a rapid deterioration of metrics. In
addition, given the decline in traditional OOH to the benefit of
digital OOH assets, delays in inventory can also have a material
effect on performance.
Exterion Media's Caa1 CFR reflects the company's (1) limited
scale and high contract concentration which make it vulnerable to
declines in demand; (2) weak performance in 2017 which will lead
to declining EBITDA margins and an increase in Moody's adjusted
leverage to 4.3x at year end compared to 3.9x in 2016; (3)
exposure to the cyclical advertising industry and
underperformance compared to the wider UK out-of-home (OOH)
advertising sector; (4) high concentration in the UK and in
London in particular through the London Underground contract; and
(5) weak liquidity profile as continued long-term access to the
revolving credit facility is uncertain in light of the very thin
covenant headroom.
The Caa1 CFR also reflects (1) Exterion Media's good position in
its key markets, specifically the UK transport OOH advertising
segment; (2) the long-standing relationships and long-term
contracts the company maintains with site owners, landlords and
supply partners and which is evidenced by the high contact
renewal rates achieved; and (3) potential for the company's
performance to improve as the London Underground inventory is
updated and Crossrail stations open -- although the timing of
these remains uncertain and out of the company's control.
RATIONALE FOR NEGATIVE OUTLOOK
The negative outlook reflects Moody's view that, given the lack
of a clearly stated strategy to alleviate covenant headroom
pressure, the company could lose access to its revolving credit
facility or engage in a restructuring transaction that could
constitute a distressed exchange under Moody's definition.
WHAT COULD CHANGE THE RATING UP/DOWN
Exterion Media's ratings could be downgraded further if a longer-
term solution to the company's very limited covenant headroom is
not agreed or should the company engage in any distressed
exchange transaction. The ratings could be upgraded should the
company successfully resolve the very limited headroom under its
covenant schedule on a sustainable basis, while continuing to
perform in line with its budget.
LIST OF AFFECTED RATINGS
Issuer: Doubleplay I Ltd
Downgrades:
-- LT Corporate Family Rating, Downgraded to Caa1 from B3
-- Probability of Default Rating, Downgraded to Caa2-PD from
Caa1-PD
Outlook Actions:
-- Outlook, Changed To Negative From Rating Under Review
Issuer: Exterion Media Holdings Limited
Downgrades:
-- BACKED Senior Secured Bank Credit Facility, Downgraded to
Caa1 from B3
Outlook Actions:
-- Outlook, Changed To Negative From Rating Under Review
PRINCIPAL METHODOLOGY
The principal methodology used in these ratings was Media
Industry published in June 2017.
Headquartered in the UK, Exterion Media is an out-of-home (OOH)
advertising company operating in five countries in Western
Europe. The company operates a portfolio of over 425,000 faces
consisting of billboards and displays on buses, the London
Underground, national railways, transit shelters and shopping
malls. In the year ending December 2016 the company reported
revenue of GBP381 million and EBITDAR (excluding restructuring
costs and exceptional items) of GBP52.7 million.
GRORUD ENGINEERING: Enters Liquidation After Missing Payments
-------------------------------------------------------------
Jonathon Manning at ChronicleLive reports that car parts
manufacturer Grorud Engineering has officially entered
liquidation after failing to keep up with payments to creditors.
The Consett company closed last year after losing a major
contract with Japanese airbag manufacturer Takata, a move which
led to the loss of 130 jobs, ChronicleLive recounts.
Grorud's factory gates were shut after it entered a Compulsory
Voluntary Arrangement (CVA), a form of insolvency that means
firms do not have to pay redundancies, ChronicleLive relays.
Instead, redundancy payments to staff are paid by the Government,
ChronicleLive relates.
The arrangement was supported by Grorud's managing director
George Lambert, who wrote to staff to tell them that entering
into a CVA was "the best option to expediate payment of monies
owed" to those made redundant, ChronicleLive discloses.
According to ChronicleLive, documents published on Companies
House show Grorud has gone into liquidation, having failed to
keep up its CVA commitments because it was no longer trading.
When the liquidation was filed Grorud owed creditors a total of
GBP1.77 million, with the list of company creditors including
GBP114,000 owed to HMRC and GBP663,886 owed to 98 former
employees, ChronicleLive notes.
Andy Whelan -- Andy.Whelan@wsm.co.uk -- a partner at business
advisory firm WSM Marks Bloom, has been appointed as the
company's liquidator, ChronicleLive relays.
In a document outlining the termination of the voluntary
arrangement, Mr. Whelan, as cited by ChronicleLive, said: "The
CVA, as approved by creditors on April 10 2017, anticipated that
the company would pay monthly contributions for five years from
May 2017, starting at GBP3,000 per month for the first year.
"The anticipated return to creditors was 100p in the pound on
preferential claims and 13.3p in the pound on unsecured claims.
"Contributions fell more than three months in arrears on October
31, 2017. I therefore issued a Notice of Breach to the Company
on November 2, 2017, which gave it 60 days to remedy the breach.
In fact, by that stage the Company had ceased trading, and was
unable to remedy the breach.
"The director of the company ultimately instructed me on December
20, 2017, to assist with placing the Company into creditors'
voluntary liquidation, and the company entered the liquidation on
January 23, 2018.
"Consequently, I am terminating the CVA.
"Two month contributions of GBP3,000 were paid into the CVA. The
last contribution was received on July 5, 2017, in respect of the
June 2017 contribution."
JAMIE'S ITALIAN: Owed $125MM to Creditors, CVA Saves 1,800 Jobs
---------------------------------------------------------------
News.com.au reports that world renowned chef Jamie Oliver's
company has cooked up more than $125 million in debt, with his
Italian restaurant chain forced to shut down a number of its
eateries.
The TV star begged landlords to cut his rent at a number of his
underperforming restaurants to avoid his business going bust,
News.com.au relates.
In a crucial meeting on Feb 9, his creditors voted to cut rent at
some restaurants by 30%, News.com.au discloses.
The Company Voluntary Arrangement means the firm can still trade
but 12 of 25 sites in the UK will shut with 450 jobs lost as the
business undergoes a massive restructure, News.com.au notes.
Mr. Oliver also has 28 restaurants overseas, including a number
in Australia, but at this stage it is understood they will not be
affected, News.com.au states.
High Court documents, obtained by The Sun, revealed Jamie's
Italian Limited owes about $53 million (GBP30.2 million) to
financial services company HSBC in overdrafts and loans,
News.com.au relays.
It is also about $73 million (GBP41.3million) in the red with
creditors such as the taxman, landlords and suppliers -- with
staff owed $3.89 million (GBP2.2 million).
The news of a restructure is a massive relief for creditors who
may not have been paid if the company had gone into
administration, News.com.au says.
Legal papers blamed underinvestment, unsuitable new locations and
high costs, News.com.au discloses.
The firm, as cited by News.com.au, said: "We are pleased to have
received the overwhelming support from our creditors for our
proposal to reshape Jamie's Italian restaurants. We have a
strong brand and are focused on continuing to deliver the levels
of service, taste and the experience our loyal customers deserve.
"We are working hard to ensure that our estate is fit for the
current trading environment and we feel confident that this newly
shaped business will provide strong opportunities for growth and
profitability."
"We feel confident this newly shaped business will provide growth
and profitability.
A company spokesman added: "The CVA approval ensures Jamie's
Italian's great staff and suppliers can all get paid and has
saved 1,800 jobs."
According to News.com.au, Simon Bonney --
simon.bonney@quantuma.com -- of administrators Quantuma LLP said:
"Jamie's proposal for a CVA is the latest in a long line of food
and beverage and retail companies who have multiple sites, which
they can no longer afford, often signing up to leases as part of
a strategy to grow, but failing to convert some of those
locations into profitable sites.
"A number of these CVAs fail. Generally this is because the
proposal was not sufficiently well thought out to have a real
effect on the future viability of the company, or represents a
sticking plaster for the company's woes."
Experts doubt the chain will survive in the long-term,
News.com.au notes.
NEWGATE FUNDING 2007-3: S&P Raises Cl. E Notes Rating to B+ (sf)
----------------------------------------------------------------
S&P Global Ratings raised its credit ratings on all of Newgate
Funding PLC's series 2007-3 notes. At the same time, S&P removed
its ratings on the class A2b and A3 notes from CreditWatch with
positive implications.
S&P said, "The upgrades follow our credit and cash flow analysis
of the transaction using information from the December 2017
investor report and loan-level data, and the application of our
relevant criteria.
"On Nov. 10, 2017, we placed on CreditWatch positive our ratings
on the class A2b and A3 notes following our Oct. 17, 2017,
upgrade of Barclays Bank PLC, the collection account provider,
guaranteed investment contract (GIC) account provider,
transaction account provider, and swap counterparty.
"In our opinion, the performance of the loans in the collateral
pool has improved since our Sept. 29, 2016, review. Total
delinquencies have decreased to 14.1% from 15.9%, and 90+ days
delinquencies to 7.8% from 8.7%. The abovementioned decreases are
in line with the evolution observed in our U.K. nonconforming
residential mortgage-backed securities (RMBS) index.
"Prepayments have remained stable since our previous review. As
of December 2017, the prepayment rate in this transaction was
about 6.9%, which is higher than the 6.3% observed in our index.
"The lower arrears levels and greater proportion of the loans in
the pool receiving the maximum seasoning credit benefitted our
weighted-average foreclosure frequency (WAFF) calculations. Our
weighted-average loss severity (WALS) assumptions have decreased
at all rating levels. The transaction has benefitted from the
decrease in the weighted-average current loan-to-value ratios
resulting from the increase in house prices and the amortization
of repayment loans."
Rating WAFF WALS
(%) (%)
AAA 28.96 42.79
AA 23.33 36.11
A 18.78 24.83
BBB 14.94 18.45
BB 10.92 14.27
B 9.28 10.83
Credit enhancement has increased for all rated classes of notes
since S&P's previous review. The notes benefit from a liquidity
facility and a reserve fund that are not amortizing as the
respective cumulative loss triggers have been breached.
The structure started amortizing pro rata in September 2014
because all of the pro rata triggers were met. S&P has considered
this in its cash flow analysis.
S&P said, "We consider the available credit enhancement for the
class Ba, Bb, Cb, D, and E notes to be commensurate with higher
ratings than those currently assigned. We have therefore raised
our ratings on these classes of notes.
"Our credit and cash flow analysis shows that the available
credit enhancement for the class A2b and A3 notes is commensurate
with higher ratings than 'A (sf)'. However, as the bank account
provider (Barclays Bank; A/Stable/A-1) has not remedied the
breach of the 'A-1+' downgrade trigger specified in the
transaction documents following its November 2011 downgrade, our
current counterparty criteria cap the maximum potential rating on
the notes in this transaction at our 'A' long-term issuer credit
rating on Barclays Bank. We have therefore raised to 'A (sf)'
from 'A- (sf)' and removed from CreditWatch positive our ratings
on the class A2b and A3 notes."
Newgate Funding's series 2007-3 is a U.K. nonconforming RMBS
transaction with collateral comprising a pool of first-ranking
mortgages over freehold and leasehold owner-occupied properties.
RATINGS LIST
Class Rating
To From
Newgate Funding PLC EUR485 Million, รบ503.55 Million Mortgage-
Backed Floating-Rate Notes Series 2007-3
Ratings Raised and Removed From CreditWatch Positive
A2b A (sf) A- (sf)/Watch Pos
A3 A (sf) A- (sf)/Watch Pos
Ratings Raised
Ba A- (sf) BBB (sf)
Bb A- (sf) BBB (sf)
Cb BBB (sf) BBB- (sf)
D BBB- (sf) BB (sf)
E B+ (sf) B- (sf)
SEADRILL LTD: Nears Resolution of Dispute Over Restructuring
------------------------------------------------------------
Mikael Holter at Bloomberg News reports that the pressure applied
by disgruntled Seadrill Ltd. bondholders to get better terms in
the offshore driller's restructuring may finally be paying off.
The company controlled by billionaire John Fredriksen believes
all stakeholders -- including new investors, banks, shipyards and
bondholders -- are "close to arriving at a global resolution," it
said in a U.S. court filing on Feb. 9, Bloomberg relates.
Seadrill said it expects to present the agreement, which would
replace a plan backed by Mr. Fredriksen and challenged by
bondholders, to the court on Feb. 16, Bloomberg notes.
According to Bloomberg, the company said a deal would bring the
crucial support of bondholders and shipyards in return for better
restructuring terms.
"Although not all issues are resolved at this time, discussions
have coalesced around a settlement structure that, if
implemented, will increase recoveries to all general unsecured
creditors," Bloomberg quotes Seadrill as saying in its filing,
made in the U.S. Bankruptcy Court for the Southern District of
Texas.
Barclays Plc and a group of 37 investors led by Nine Masts
Capital Ltd. have both submitted alternative plans to obtain a
better recovery for their bonds, Bloomberg discloses. The
Official Committee of Unsecured Creditors, which represents
stakeholders including shipyards that are owed hundreds of
millions of dollars, has criticized the plan and the process
leading to it, Bloomberg states.
About Seadrill Ltd.
Seadrill Limited is a deepwater drilling contractor providing
drilling services to the oil and gas industry. It is
incorporated in Bermuda and managed from London. Seadrill and
its affiliates own or lease 51 drilling rigs, which represents
more than 6% of the world fleet.
As of Sept. 12, 2017, Seadrill employed 3,760 highly-skilled
individuals across 22 countries and five continents to operate
their drilling rigs and perform various other corporate
functions.
As of June 30, 2017, Seadrill had $20.71 billion in total assets,
$10.77 billion in total liabilities and $9.94 billion in total
equity.
Seadrill reported a net loss of US$155 million on US$3.17 billion
of total operating revenues for the year ended Dec. 31, 2016,
following a net loss of US$635 million on US$4.33 billion of
total operating revenues for the year ended in 2015.
After reaching terms of a reorganization plan that would
restructure $8 billion of funded debt, Seadrill Limited and 85
affiliated debtors each filed a voluntary petition for relief
under Chapter 11 of the United States Bankruptcy Code (Bankr.
S.D. Tex. Lead Case No. 17-60079) on Sept. 12, 2017.
Together with the chapter 11 proceedings, Seadrill, North
Atlantic Drilling Limited ("NADL") and Sevan Drilling Limited
("Sevan") commenced liquidation proceedings in Bermuda to appoint
joint provisional liquidators and facilitate recognition and
implementation of the transactions contemplated by the RSA and
Investment Agreement, and Simon Edel, Alan Bloom and Roy Bailey
of Ernst & Young are to act as the joint and several provisional
liquidators.
In the Chapter 11 cases, the Company has engaged Kirkland & Ellis
LLP as legal counsel, Houlihan Lokey, Inc. as financial advisor,
and Alvarez & Marsal as restructuring advisor. Slaughter and May
has been engaged as corporate counsel, and Morgan Stanley served
as co-financial advisor during the negotiation of the
restructuring agreement. Advokatfirmaet Thommessen AS is serving
as Norwegian counsel. Conyers Dill & Pearman is serving as
Bermuda counsel. Prime Clerk serves as claims agent.
The United States Trustee for Region 7 formed an official
committee of unsecured creditors with seven members: (i)
Computershare Trust Company, N.A.; (ii) Daewoo Shipbuilding &
Marine Engineering Co., Ltd.; (iii) Deutsche Bank Trust Company
Americas; (iv) Louisiana Machinery Co., LLC; (v) Nordic Trustee
AS; (vi) Pentagon Freight Services, Inc.; and (vii) Samsung Heavy
Industries Co., Ltd.
Kramer Levin Naftalis & Frankel LLP is serving as lead counsel to
the Committee. Cole Schotz P.C. is local and conflicts counsel
to the Committee. Zuill & Co (in exclusive association with
Harney Westwood & Riegels) is serving as Bermuda counsel.
London-based Quinn Emanuel Urquhart & Sullivan, UK LLP, is
serving as English counsel. Parella Weinberg Partners LLP is the
investment banker to the Committee. FTI Consulting Inc. is the
financial advisor.
*********
Monday's edition of the TCR delivers a list of indicative prices
for bond issues that reportedly trade well below par. Prices are
obtained by TCR editors from a variety of outside sources during
the prior week we think are reliable. Those sources may not,
however, be complete or accurate. The Monday Bond Pricing table
is compiled on the Friday prior to publication. Prices reported
are not intended to reflect actual trades. Prices for actual
trades are probably different. Our objective is to share
information, not make markets in publicly traded securities.
Nothing in the TCR constitutes an offer or solicitation to buy or
sell any security of any kind. It is likely that some entity
affiliated with a TCR editor holds some position in the issuers'
public debt and equity securities about which we report.
Each Tuesday edition of the TCR contains a list of companies with
insolvent balance sheets whose shares trade higher than US$3 per
share in public markets. At first glance, this list may look
like the definitive compilation of stocks that are ideal to sell
short. Don't be fooled. Assets, for example, reported at
historical cost net of depreciation may understate the true value
of a firm's assets. A company may establish reserves on its
balance sheet for liabilities that may never materialize. The
prices at which equity securities trade in public market are
determined by more than a balance sheet solvency test.
Each Friday's edition of the TCR includes a review about a book
of interest to troubled company professionals. All titles are
available at your local bookstore or through Amazon.com. Go to
http://www.bankrupt.com/booksto order any title today.
*********
S U B S C R I P T I O N I N F O R M A T I O N
Troubled Company Reporter-Europe is a daily newsletter co-
published by Bankruptcy Creditors' Service, Inc., Fairless Hills,
Pennsylvania, USA, and Beard Group, Inc., Washington, D.C., USA.
Marites O. Claro, Rousel Elaine T. Fernandez, Joy A. Agravante,
Julie Anne L. Toledo, Ivy B. Magdadaro, and Peter A. Chapman,
Editors.
Copyright 2018. All rights reserved. ISSN 1529-2754.
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