/raid1/www/Hosts/bankrupt/TCREUR

/raid1/www/Hosts/bankrupt/TCREUR_Public/190306.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, March 6, 2019, Vol. 20, No. 47 Headlines F R A N C E TEREOS SCA: Fitch Cuts LongTerm IDR to 'BB-', Outlook Stable I R E L A N D BILBAO CLO II: Fitch Gives 'BB-(EXP)' Rating to EUR24MM Cl. D Notes JOHNSON CONTROLS: Fitch Assigns B+ First-Time IDR, Outlook Stable L U X E M B O U R G ROSSINI ACQUISITION: S&P Assigns 'B' Long-Term ICR, Outlook Stable R U S S I A ACCEPT LLC: Assets Insufficient to Meet Liabilities TAGILANK JSC: Liabilities Exceed Assets, Assessment Shows U N I T E D K I N G D O M ALTE LIEBE 1: S&P Withdraws 'CC' Rating on EUR102MM Sec. Notes BETTER BATHROOMS: Cashflow Difficulties Prompt Administration DEBENHAMS PLC: Issues Another Profit Warning Amid Rescue Talks FINSBURY SQUARE 2019-1: Fitch Gives 'B(EXP)' Rating on Cl. X Notes GOSTLING LTD: Put Up for Sale, Administrators Appointed JAMES DOLAN: Enters Into CVA After Losing Major Customer - - - - - =========== F R A N C E =========== TEREOS SCA: Fitch Cuts LongTerm IDR to 'BB-', Outlook Stable ------------------------------------------------------------ Fitch Ratings has downgraded Tereos SCA's (Tereos) Long-Term Issuer Default Rating (IDR) to 'BB-' from 'BB'. The Outlook is Stable. The senior unsecured ratings of the bonds issued by subsidiary Tereos Finance Groupe 1 (FinCo), guaranteed by Tereos, have been downgraded to 'B+' from 'BB-'. The downgrade reflects Fitch's view of a deeper contraction in profitability in the financial years to March 2019 and 2020 than anticipated in its previous rating review, due to a worse sugar price environment compared with its previous assumptions. This will delay the company's ability to return to positive free cash flow (FCF) and to deleverage towards levels commensurate with the previous rating. The Stable Outlook captures Fitch's confidence in the company's cost rationalisation and diversification efforts and its view of through-the-cycle sugar prices, which should lead to credit metrics being more compatible with a 'BB-' rating by FY21. KEY RATING DRIVERS Hit by Low Sugar Prices: Fitch projects Tereos's FY19 revenue and profit to suffer materially due to the record low world sugar prices observed since 2H18. This was confirmed by the company's 9MFY19 results, which showed EBITDA falling 57% yoy and EBITDA margin dropping to just 6.1% (9MFY18: 12.9%). This is below Fitch's previous estimate for the year of 7.1%. The Sugar Europe division suffered the most (EBITDA margin dropped to 2.2% in 9M19) as procurement prices for sugar beet had been fixed in 2017 for two years, thus limiting Tereos's ability to adjust its cost structure in FY18 and FY19. In addition, Fitch expects low sugar prices to pressure 1HFY20 performance as a high share of sales in EU for the 2018/19 sugar campaign were contracted at previously lower levels, with a more severe impact on profits than it had estimated. Slower Deleveraging than Expected: The 'BB' rating category continues to capture the profit volatility inherent in commodities processing. However, the extent of the profit hit forecast for FY19-FY20 now results in a much slower deleveraging pace than Fitch's previous expectations, thus resulting in the rating downgrade to 'BB-'. Fitch expects that Tereos will have stretched leverage ratios during FY19-FY20 and expect a return of its consolidated funds from operations (FFO) readily marketable inventories (RMI)-adjusted net leverage to below 5x only from FY21. Sugar Prices Past Trough: Fitch expects a recovery of 15% to 20% in global sugar prices from their historical lows in 3Q18. This is based on a smaller global sugar surplus projected for the sugar beet campaign of 2018/19 after the record high levels of 2017/18 that caused a material contraction of international prices last year. However, there is also scope for a higher price growth if a global sugar deficit, as predicted by many market participants, materialises for the next campaign of 2019/20. While this is not its rating case, the current market supports Fitch's confidence that the trough in sugar prices is now behind. Improving Stability from FY20: Starting from the 2019/20 sugar campaign Tereos plans to make sugar beet procurement prices in France more aligned with market prices. Fitch believes that this will allow the company to increase the stability of profit margins in the Sugar Europe division. Fitch sees this as an important risk-mitigating factor for the business profile, which would position Tereos more firmly in the 'BB' rating category in the future. In addition, Tereos is launching a new efficiency programme with a targeted EBITDA improvement of EUR200 million. Fitch only factors in a small portion of such gains into its forecasts, but it should further improve profitability for Tereos by FY22. Large FCF Outflow for FY19-FY20: Fitch expects both FY19 and FY20 to result in major FCF outflows (EUR250 million and around EUR190 million respectively), due to decline in profits and capex remaining high as the company continues to invest in the development of its starch and sweeteners operations (also as part of a new efficiency programme). Fitch understands from management that for FY19-FY20 half the capex will be for expansionary investments, which puts extra pressure on FCF during this period. Nevertheless, up-scaling the growing Starch and Sweeteners division is important for profitability growth and further supports operational diversification, thus reducing volatility from core sugar operations. Good Financial Flexibility: Tereos maintains good financial flexibility, due to financial discipline in shareholder distributions and M&A spending, and adequate liquidity and FX risk management. During periods of low sugar prices, cooperative owners have historically shown their support for Tereos by accepting a sharp reduction in "price complements", which Fitch views as being akin to dividend distributions. Fitch expects the company's RMI-adjusted FFO fixed-charge cover to decrease temporarily to close to 2x before recovering to above 2.5x from FY20 (FY18: 3.5x), and remaining at solid levels throughout the commodity cycle. Strong Business Profile: The IDR of Tereos remains underpinned by a strong business profile for the 'BB' category, both in operational scope and its position in commodity markets with potential for long-term growth. Tereos is the second-largest sugar company in the world due mainly to its production in the EU and Brazil. Moreover, it enjoys solid product diversification on continued investments to build a global starches and sweeteners business. Tereos also has the ability to shift processing across from sugar to ethanol to take advantage of better market prices. Weak Bond Recovery Prospects: The rating on the senior unsecured notes issued by the financial vehicle Finco is derived from the consolidated company's IDR of 'BB-'. However, prior-ranking debt at the operating entities constitutes more than 2.5x of consolidated EBITDA and Fitch projects this to remain largely unchanged for the next four years. Under Fitch's Recovery Rating and Notching methodology this indicates a high likelihood of subordination and lower recoveries for unsecured debt raised by FinCo. As a result, following the downgrade of the IDR, Fitch has also downgraded the rating of the unsecured bonds by one notch to 'B+'. DERIVATION SUMMARY Tereos's 'BB-' IDR is positioned between the credit quality of larger and significantly more diversified commodity trader and processor Bunge Limited (BBB-/Stable) and the 'B' category- Kernel Holding S.A. (B+/Stable) and Biosev S.A. (B+/Stable). The ratings of the latter two discount the heavy concentration on a single country that originates the commodities these companies process and sell. Tereos enjoys moderate geographic diversification with materials sourced mainly from Europe and Brazil as well as from combining production of beet sugar, cane sugar, sweeteners, ethanol and starches. Tereos's business profile is also much stronger than 'B+'-rated Corporacion Azucarera del Peru S.A.'s due to a much greater scale and wider geographic diversification; this is however balanced by the higher leverage of Tereos than the Peruvian company's. KEY ASSUMPTIONS Fitch's Key Assumptions Within Its Rating Case for the Issuer - Reduction in revenue in FY19 by low teens in percentage terms, mainly due to low sugar prices this year. Mid-to-high single-digit annual growth over FY20-21, supported by higher volumes and world sugar price recovery from 2HFY20. Low-to-mid single digit annual growth afterwards. - EBITDA margin to drop to around 6.5% in FY19, mainly due to material EBITDA contraction in the Sugar Europe division before gradually recovering toward 12.5% by FY22 on the back of recovering sugar prices and procurement prices for sugar beet in France becoming more aligned with market prices from FY20. Fitch also assumes some efficiency gains from the initiatives undertaken over FY15-FY18 and under the new "Ambitions 2022" plan. - Capex at around EUR400 million in FY19 and at around 7%-8% of revenue over FY20-22 as the company continues to invest in higher efficiency and capacity. - Dividend payments (or price complements) of around EUR20 million-EUR30 million per year. - No material M&A. RATING SENSITIVITIES Developments That May, Individually or Collectively, Lead to Positive Rating Action - Strengthening of profitability (excluding price fluctuations), as measured by RMI-adjusted EBITDAR/gross profit returning to above 30%, reflecting reasonable capacity utilisation rates in the sugar beet business and overall increased efficiency. - At least neutral FCF while maintaining strict financial discipline. - Consolidated FFO net leverage (RMI-adjusted) consistently below 4.0x (FY18: 4.0x). Developments That May, Individually or Collectively, Lead to Negative Rating Action - Inability to sustainably maintain cost savings derived from its efficiency programmes or excessive idle capacity in different market segments, leading to RMI-adjusted EBITDAR/gross profit remaining weak. - Inability to return consolidated FFO to approximately EUR400 million (FY18: EUR439 million) and to improve profitability and cash flow generation following FY19 and FY20 cyclical downturns. - Reduced financial flexibility as reflected in FFO fixed-charge cover (RMI-adjusted) falling permanently below 2.0x (FY18: 3.5x). - Consolidated FFO net leverage (RMI-adjusted) above 5.0x on a sustained basis. LIQUIDITY AND DEBT STRUCTURE Adequate Liquidity: Tereos had EUR417 million of undrawn committed long-term facilities as of end-2018, which together with EUR414 million of available cash, was sufficient to cover short-term debt of EUR691 million (including EUR240 million of factoring utilisation). SUMMARY OF FINANCIAL ADJUSTMENTS Fitch adjusted debt by adding a multiple of 6x of yearly operating lease expense related to long-term assets (EUR50 million for FY18). The multiple of 6x reflects operating lease expenses related to the company's Brazilian operations. Fitch calculates Tereos's financial ratios by excluding the debt and the interest costs used to finance those RMIs for which the agency has reasonable assurance from management that they are protected against price risk. In FY18 Fitch judged EUR470 million of Tereos's inventories as readily marketable, based on EUR595 million of inventories of finished products. Therefore Fitch adjusted the company's debt and gross cash interest down by EUR334 million and EUR29 million respectively. Cash interest costs are reclassified as operating costs for the purpose of RMI-adjusted FFO fixed charge cover. Fitch views the company's factoring programme as an alternative to secured debt, and therefore adjusts Tereos's FY18 total debt by the amount of receivables sold and de-recognised at end-FY18 (EUR162 million). Fitch has also decreased the group's working capital inflow (included in Fitch's FCF calculation) by the year-on-year increase in outstanding factoring funding at closing, i.e. EUR14 million. Cash flow from financing (excluded from Fitch's FCF calculation) has been increased by the same amount. ============= I R E L A N D ============= BILBAO CLO II: Fitch Gives 'BB-(EXP)' Rating to EUR24MM Cl. D Notes ------------------------------------------------------------------- Fitch Ratings has assigned Bilbao CLO II Designated Activity Company expected ratings, as follows: EUR1.4 million Class X: 'AAA(EXP)sf'; Outlook Stable EUR233 million Class A-1A: 'AAA(EXP)sf'; Outlook Stable EUR15 million Class A-1B: 'AAA(EXP)sf'; Outlook Stable EUR23 million Class A-2A: 'AA(EXP)sf'; Outlook Stable EUR5 million Class A-2B: 'AA(EXP)sf'; Outlook Stable EUR27 million Class B: 'A(EXP)sf'; Outlook Stable EUR29.5 million Class C: 'BBB- (EXP)sf'; Outlook Stable EUR24.5 million Class D: 'BB-(EXP)sf'; Outlook Stable EUR51.4 million subordinated notes: 'NR(EXP)sf' The assignment of final ratings is contingent on the receipt of final documents conforming to information already reviewed. Bilbao CLO II Designated Activity Company is a securitisation of mainly senior secured loans (at least 90%) with a component of senior unsecured, mezzanine, and second-lien loans. A total expected note issuance of EUR409.8 million will be used to fund a portfolio with a target par of EUR400 million. The portfolio will be managed by Guggenheim Partners Europe Limited . The CLO envisages a 4.5-year reinvestment period and an 8.5-year weighted average life. KEY RATING DRIVERS 'B'/'B-' Portfolio Credit Quality Fitch places the average credit quality of obligors in the 'B' range. The Fitch-weighted average rating factor (WARF) of the identified portfolio is 32.33, while the indicative covenanted maximum Fitch WARF for assigning the expected ratings is 34.25. High Recovery Expectations At least 90% of the portfolio comprises 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 (WARR) of the identified portfolio is 66.06%,while the indicative covenanted minimum Fitch WARR for assigning expected ratings is 63%. Limited Interest Rate Exposure Up to 5% of the portfolio can be invested in fixed-rate assets, while fixed-rate liabilities represent 5% of the target par. Fitch modelled both 0% and 5% 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 expected ratings is 20% of the portfolio balance. The transaction also includes limits on maximum industry exposure based on Fitch's industry definitions. The maximum exposure to the three largest (Fitch-defined) industries in the portfolio is covenanted at 40%. These covenants ensure that the asset portfolio will not be exposed to excessive concentration. Adverse Selection and Portfolio Management The transaction features a 4.5-year reinvestment period and includes reinvestment criteria similar to other European transactions. Fitch's analysis is based on a stressed-case portfolio with the aim of testing the robustness of the transaction structure against its covenants and portfolio guidelines. Cash Flow Analysis Fitch used a customised proprietary cash flow model to replicate the principal and interest waterfalls and the various structural features of the transaction, and to assess their effectiveness, including the structural protection provided by excess spread diverted through the par value and interest coverage tests. 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 four notches for the rated notes. A 25% reduction in recovery rates would lead to a downgrade of up to five notches for the rated notes. JOHNSON CONTROLS: Fitch Assigns B+ First-Time IDR, Outlook Stable ----------------------------------------------------------------- Fitch Ratings has assigned First-Time, Long-Term Issuer Default Ratings (IDRs) of 'B+' to Johnson Controls Power Solutions (JCPS) and its Panther BF Aggregator 2 LP subsidiary (Panther). In addition, Fitch has assigned a rating of 'BB+'/'RR1' to Panther's secured asset based lending (ABL) revolving credit facility and ratings of 'BB'/'RR2' to Panther's first lien secured revolving credit facility, first lien secured U.S. Dollar Term Loan B, first lien secured Euro Term Loan B and first lien secured notes. Fitch has also assigned a rating of 'B-'/'RR6' to Panther's senior unsecured notes. The ratings apply to a $500 million ABL revolver, a $750 million first lien revolver, $8.2 billion in first lien secured debt and $1.95 billion in senior unsecured debt. The Rating Outlook is Stable. KEY RATING DRIVERS Ratings Overview: JCPS's ratings reflect the company's relatively strong business profile balanced against the highly levered capital structure that Fitch expects the company to have following its upcoming acquisition by Brookfield Business Partners L.P. (Brookfield, the primary investor) and Caisse de depot et placement du Quebec (CDPQ). JCPS's top market position as the world's largest manufacturer of low-voltage vehicle batteries, its consistently high profitability and the non-discretionary nature of its products, with 75% of its revenue derived from the less cyclical vehicle aftermarket, are all strong credit positives. However, Fitch expects pro forma EBITDA leverage to be close to 7.0x when the acquisition closes and to remain above 5.0x even two years after the transaction closes. Future Business Prospects: Fitch's believes JCPS will have strong business prospects moving forward. Virtually all motor vehicles use a low-voltage battery for certain functions, including fully electric vehicles. As such, Fitch expects battery demand will continue to grow along with the number of global vehicles in service, regardless of how those vehicles are powered. Vehicle batteries are also non-discretionary items, making demand somewhat resistant to changes in the economic cycle. As vehicles become more technologically complex, vehicle manufacturers are also increasingly shifting toward the use of more advanced absorbent glass mat (AGM) and enhanced flooded (EFB) batteries that generally carry higher margins, which will benefit JCPS over the intermediate term. Rating Risks: Aside from its high financial leverage, other rating concerns include heavy industry competition, volatile raw material costs, possible technological change and potential environmental concerns related to the lead and sulfuric acid that are primary ingredients in most low-voltage vehicle batteries. However, JCPS has a relatively good track record managing most of these concerns. The company has strong relationships with many global aftermarket battery distributors and most global vehicle manufacturers, and its top market position provides it with advantages over its smaller competitors. JCPS also has generally been able to pass through higher raw material costs to its customers via changes in pricing, although it may not always be able to fully offset the change in material costs. The company's environmental record has also been relatively good, especially compared with certain other battery manufacturers with spottier records, although there is always a degree of risk associated with the substances used in battery manufacturing. Cost Savings Initiatives: JCPS and Brookfield have identified between $300 million and $400 million of detailed cost savings opportunities that the company plans to undertake following the acquisition. The company estimates the savings plans will take about three to four years to fully implement. Fitch views the savings as largely achievable, and it has incorporated the low end of the range into its forecasts. The largest cost savings opportunity, which accounts for over half the total, involves improving the efficiency of the company's operations by optimizing its manufacturing and distribution footprint and reducing complexity in the number of products offered. Other cost savings targets involve procurement savings, as well as transportation and logistics cost improvements. Solid FCF: Fitch also expects JCPS to produce consistently positive FCF going forward. FCF in the near term will be pressured somewhat by elevated capex, which Fitch estimates will run at a little over 4% of revenue over the next couple of years as the company continues to make investments related to new products and expanding its manufacturing footprint. As those investments are completed, Fitch expects capex to trend down toward 3% of revenue over the following years. As the company's capex investments wind down, Fitch expects FCF margins to strengthen toward the mid-single-digit range from the low-single-digit range over the next couple of years. Debt and Leverage: Fitch expects JCPS to have close to $11 billion in debt, including off-balance-sheet factoring, when the acquisition closes. This is expected to include about $8.2 billion in first lien secured debt, consisting of U.S. dollar- and Euro-denominated term loans and secured notes, as well as $1.95 billion in senior unsecured notes. The remaining debt will largely consist of off-balance sheet factoring. Fitch expects at least a portion of the term loan debt to be amortizing, which, along with prepayment flexibility, will allow the company to reduce debt over the next few years. However, the company is likely to have a substantial amount of non-amortizing debt that may lead to significant refinancing risk over the longer term. As a result of its substantial debt load, Fitch expects JCPS's gross EBITDA leverage to be high for at least the next several years. Including estimated off-balance-sheet factoring, Fitch expects pro forma EBITDA leverage to be close to 7.0x at the close of the acquisition. Fitch expects the company will target available FCF toward debt reduction over the next several years, and declining debt, along with an expected rise in EBITDA, will lead to EBITDA leverage declining to the low-5x range over the intermediate term. This will still be relatively high, as most Fitch-rated auto suppliers with IDRs in the 'B' range have typically had EBITDA leverage in the 3.5x to 5.0x range. However, as noted earlier, Fitch views JCPS's strong business profile as a partial offset to the company's high leverage. Fitch expects FFO-adjusted leverage to also be high over the intermediate term. Fitch expects pro forma FFO-adjusted leverage to be in the low-8x range at the close of the acquisition, falling to the low-6x range over the next several years. Ratings Notching: The rating of 'BB+'/'RR1' on JCPS's ABL revolver reflects its full collateral coverage and the likelihood of a recovery in the 91%-100% range in a distressed scenario. The ratings of 'BB'/'RR2' on JCPS's first lien secured credit facility (which includes the cash flow revolver and the Term Loan Bs) and first lien secured notes reflect their substantial collateral coverage and superior recovery prospects in the 71%-90% range in a distressed scenario. The recovery prospects are weighed down somewhat by the substantial amount of first lien debt in JCPS's capital structure, as well as the higher priority of the ABL and the off-balance sheet factoring. The rating of 'B-'/'RR6' on JCPS's senior unsecured notes reflects Fitch's expectation that recovery would be poor in a distressed scenario, with recovery in the 0%-10% range due to the substantial amount of higher-priority secured debt in the capital structure. DERIVATION SUMMARY JCPS has a very strong competitive position as the largest low-voltage vehicle battery manufacturer in the world, with the company responsible about one-third of the industry's total production. Although the company counts many of the global original equipment manufacturers (OEMs) as its customers, roughly three-quarters of its sales are into the global vehicle aftermarket. As batteries are a non-discretionary replacement item, JCPS's strong aftermarket presence provides the company with a more stable revenue stream through the cycle than auto suppliers that are predominantly tied to new vehicle production, such as BorgWarner, Inc. (BBB+/Stable) or Delphi Technologies PLC (BB/Stable). The company's heavy aftermarket weighting makes it more comparable with global tire manufacturers, such as Compagnie Generale des Etablissements Michelin (A-/Stable) and The Goodyear Tire & Rubber Company (BB/Stable), or other suppliers with a significant aftermarket concentration, such as Tenneco Inc. (BB-/Stable). JCPS's margins are strong for an auto supplier, with forecast EBITDA margins running in the high-teens to low-20% range over the next several years, which is stronger than some investment-grade auto suppliers, such as BorgWarner or Aptiv PLC (BBB/Stable), while forecast FCF margins in the low- to mid-single-digit range are consistent with the pre-dividend FCF margins of those same investment-grade issuers. However, forecast post-closing EBITDA leverage of nearly 7x is very high compared with the rated auto suppliers, and forecast leverage over 5x at year-end 2020 is still quite high. By comparison, Fitch estimates Tenneco's leverage will be in the mid-3x range about one year following the closing of its acquisition of Federal-Mogul LLC, which took place in late 2018. Over the longer term, Fitch expects JCPS's leverage to decline due a combination of ongoing sales growth on a rise in the number of global vehicles in use, increasing margins, and post-acquisition debt reduction. KEY ASSUMPTIONS Fitch's Key Assumptions Within Its Rating Case for the Issuer -- Fitch's forecast is on a standalone pro forma basis and assumes the acquisition is completed as envisioned; -- Global replacement battery demand grows in the low- to mid-single digit range though the forecast, principally due to a continued rise in the number of global vehicles in use; -- OEM battery demand is flat to down slightly in the near term on weaker global production levels, then rises in the low-single-digit range in the later years of the forecast; -- In addition to aftermarket and OEM demand, revenue increases on positive mix shifts to higher priced AGM and EFB batteries and modest price increases on traditional batteries; -- Margins improve through the forecast as a result of operating leverage on higher production levels, as well as improving price and mix and the attainment of the $300 million of cost savings; -- Capital spending declines through the forecast as the company completes its near-term investments; -- The company uses available FCF to accelerate debt reduction. Recovery Analysis The recovery analysis assumes JCPS would be considered a going concern and would be reorganized rather than liquidated. Fitch has assumed a 10% administrative claim in the recovery analysis. JCPS's recovery analysis reflects a potential severe downturn in vehicle battery demand and assesses the going concern pro forma EBITDA at approximately $1.6 billion based on the company's stable operations, high operating margins, significant percentage of aftermarket revenue, and the non-discretionary nature of its products. The $1.6 billion ongoing EBITDA assumption is roughly in-line with Fitch's forecast pro forma EBITDA for 2019 and 2020. Fitch has used a 6x multiple to calculate a post-reorganization valuation. According to the "Automotive Bankruptcy Enterprise Values and Creditor Recoveries" report published by Fitch in September 2018, about 44% of auto-related defaulters had exit multiples above 5x, with about 28% in the 5x to 7x range. However, the median multiple observed across 18 issuers was only 4.7x. Within the report, Fitch observed that 92% of the bankruptcy cases analyzed were resolved as a going concern. Automotive defaulters were typically weighed down by capital structures that became untenable during a period of severe demand weakness, due either to economic cyclicality or the loss of a significant customer, or they were subject to significant operational issues. While JCPS has a highly leveraged capital structure, Fitch believes the company's business profile is stronger than most of the profiles included in the automotive bankruptcy observations. Fitch utilizes the 6x EV multiple based on JCPS's strong global market position and the non-discretionary nature of the company's replacement batteries. In addition, Brookfield's acquisition of JCPS currently values the company at an EV over 8x (excluding expected post-acquisition cost savings). All of JCPS's debt will be guaranteed by certain foreign and domestic subsidiaries. Consistent with Fitch's criteria, the recovery analysis assumes that about $720 million in estimated of off-balance-sheet factoring is replaced with a super-senior facility that has the highest priority in the distribution of value. Fitch also assumes a full draw on the $500 million ABL, which receives the second priority in the distribution of value after the factoring. The assumed full draw is based on the relatively low limit on the facility relative to the collateral backing it, especially the accounts receivable. Due to the ABL's first-lien claim on ring-fenced collateral, the facility receives a Recovery Rating of 'RR1' with an expected recovery in the 91%-100% range. The analysis also assumes a full draw on the $750 million cash flow revolver. As such, the first lien secured debt totals $8.95 billion outstanding and receives a lower priority than the ABL in the distribution of value hierarchy, in part due to its second lien claim on the ABL's collateral. This results in a Recovery Rating of 'RR2' with an expected recovery in the 71%-90% range. The $1.95 billion of senior unsecured notes have the lowest priority in the distribution of value. This results in a Recovery Rating of 'RR6' with an expected recovery in the 0%-10% range, owing to the significant amount of secured debt positioned above it in the hierarchy. RATING SENSITIVITIES Developments That May, Individually or Collectively, Lead to Positive Rating Action -- Maintaining Fitch-calculated EBITDA margins in the high-teens; -- Reducing gross EBITDA leverage to 5.0x; -- Reducing lease-adjusted FFO gross leverage to 6.0x; -- Increasing the FCF margin to 3.0%. Developments That May, Individually or Collectively, Lead to Negative Rating Action -- A decline in the Fitch-calculated EBITDA margin to the low-teens for a prolonged period; -- Gross EBITDA leverage remaining above 6.5x without a clear path to de-levering; -- Lease-adjusted FFO gross leverage remaining above 7.5x without a clear path to de-levering; -- FCF margins remaining near 1.5% for a multiyear period. LIQUIDITY Fitch expects JCPS's liquidity to remain sufficient for its operating and investing needs over the intermediate term. However, liquidity will primarily be in the form of revolver capacity, as Fitch expects the company's cash balances to average only about $20 million to $30 million at most times. That said, revolver capacity, which is expected to include both the $500 million ABL facility and the $750 million secured cash flow revolver, will provide the company with good financial flexibility over the intermediate term. Excluding factoring-related debt, Fitch expects debt-related obligations to be light over the next several years, consisting primarily of Term Loan B amortization payments that Fitch estimates at $32 million per year. Pension contributions are also expected to be relatively low, with estimated contributions of about $1 million in 2019. Fitch expects JCPS's FCF to generally be sufficient to cover its seasonal cash needs. As a result, based on its criteria, Fitch has treated all of JCPS's cash as readily available in its forecasts. FULL LIST OF RATING ACTIONS Fitch has assigned the following ratings with Stable Outlooks: Johnson Controls Power Solutions -- Long-Term IDR 'B+'. Panther BF Aggregator 2 LP -- Long-Term IDR 'B+'; -- ABL Revolver Rating 'BB+'/'RR1'; -- First Lien Secured Revolver Rating 'BB'/'RR2'; -- First Lien Secured Term Loan B Rating 'BB'/'RR2'; -- First Lien Secured Notes Rating 'BB'/'RR2'; -- Senior Unsecured Notes Rating 'B-'/'RR6'. =================== L U X E M B O U R G =================== ROSSINI ACQUISITION: S&P Assigns 'B' Long-Term ICR, Outlook Stable ------------------------------------------------------------------ S&P Global Ratings is assigning its 'B' long-term issuer credit rating to Rossini Acquisition Sarl, the holding company of FIMEI SpA. S&P is assigning its 'B' issue rating to the senior secured notes issued by Rossini Sarl. S&P's rating on Rossini follows CVC Capital Partners' and co-investors' acquisitions of FIMEI SpA, the holding company that controls about 53.1% (net of treasury shares) interest in Recordati. The remaining shares are publically listed on the Milan Stock Exchange. The debt package that Rossini Sarl issued to finance the acquisition includes: -- EUR225 million revolving credit facility (RCF) due 2025. -- EUR1,300 million senior secured notes due 2025 (split EUR650 million floating rate notes priced at E+625 basis points (bps) and EUR650 million fixed rate notes priced at 675 bps. -- EUR750 million deferred payment subordinated notes. S&P has assigned its 'B' issue level to the EUR1,300 million senior secured notes and its '4' recovery ratings indicate that it sees recovery prospect of 30%-50% (rounded estimate: 30%). In early January 2019, Rossini launched a mandatory tender offer (MTO) for the remaining shares outstanding, with purchase price set at EUR27.55 per share (below the trading price of about EUR30 per share in early January 2019). The MTO ended in early February 2019 with a very low acceptance rate given the difference between offer price and current trading price (about 0.06% of the offer shares and about 0.029% of Recordati shares). The purchase of the shares for a value of EUR1.65 million was settled on Feb. 8, 2019, using cash on balance sheet. In S&P's view, the result of the MTO does not change Rossini's owner's strategy as it will continue to have control of Recordati through FIMEI. For financial year (FY) 2018, the group generated reported revenues of about EUR1.35 billion (EUR1.29 billion in FY2017), up 5% on 2017 and reported EBITDA of about EUR499 million (EUR454.7 million in FY2017). The group's EBITDA margin improved to about 36.9% from 35.3% in FY2017. FY2018 results include the impact of six months of the Natural Point acquisition in Italy. S&P acknowledges that Recordati completed the acquisition of France-based Tonipharm SAS at the end of 2018 and results are not consolidated in 2018 accounts. S&P's business risk profile reflects Recordati's well-diversified portfolio of products in different therapeutic areas, such as cardiovascular (which generated about 28% of total 2017 revenues); gastro and metabolic (about 15%); and urology (10%). These are considered niche categories that do not attract as much interest from big pharmaceuticals. Recordati's orphan drugs portfolio comprises 10 products, mainly in the metabolic disorders therapeutic area. Recordati enjoys a fully vertically integrated business model from API to finished products, ensuring cost competitiveness and high product quality. This model drives margins and protects the supply chain because about 60% of the group's net revenue is derived from internally sourced and manufactured products. S&P said, "Despite Recordati's limited size compared with big pharma companies like Pfizer, Roche, and Sanofi, we take a positive view of the group's global footprint. Its products are in about 140 markets, both directly through its on-the-ground sales force and through distribution agreements. The company operates principally in Western Europe (the source of about 55% of 2018 total revenue), where its main market of Italy accounts for 20% of total revenue. The next largest single markets are France and Germany (10% of 2018 total revenue) and the U.S. (7.7%; limited to orphan drugs products only). We also take into account Recordati's good exposure to emerging markets including Russia, Turkey, and other Central and Eastern European countries. "We view the European generics market as fragmented and price-competitive, with growth trends driven by volume rather than pricing as governments are carefully reviewing health care spending. We expect the market to grow at a compound annual rate of about 4% in 2017-2022, fueled by new molecule launches and low price erosion. It also benefits from aging populations and increasing chronic diseases amid a stable regulatory environment. "In the off-patent branded industry specifically we anticipate more acquisition opportunities given the growing number of drugs with patents expiring in 2018-2022. However, there is some uncertainty about the price of these off-patent drugs given the increase in competition in that space." S&P expects global orphan drugs market sales to grow by the double digits in the next few years, reaching above $200 billion by 2022. Orphan drugs have some advantages over prescription drugs, in terms of development (estimated at under five years from Phase II compared with six-to-eight years for prescription drugs), approval time (about 11 months compared with about 16.5 months for prescriptions), and approval success. Additionally, the orphan drugs have a faster initial uptake due to large unmet need. Although they are slower to reach peak sales (generally there are fewer sales resources and it is more difficult to capture the full patient population), the orphan drugs category is also slower to see a decrease in sales because there is less generic pressure. Growth prospects reflect the large number of unmet diseases given that only about 500 treatments exist for more than 6,800 rare diseases that have been identified. The new products in this category are often more effective than existing products, have lower competition given the small spectrum of cases, and present a relatively low burden to payors given that they remain small in relation to total health care spending. S&P's assessment of Recordati's business risk profile is constrained by the maturity of its product portfolio, mainly in the specialty and primary care division. Only 10% of revenues are protected by patents or regulatory exclusivity. Positively, this means that the "patent cliff" is only a risk for a limited proportion of Recordati's sales, the affected drugs being Urorec (for treating prostatic hyperplasia) expiring in 2020 (patented in Europe until 2018, with clinical data exclusivity until 2020) and Livazo (for hypercholesterolaemia) expiring in 2021. S&P expects the resulting decline in sales will likely be partially offset by the launch of new products such as Reagila in a new therapeutic area, schizophrenia, together with Fortacin and notably Seloken (in the cardiovascular area, following an acquisition Recordati made in mid-2017). Growth will also come from the expansion of existing products into new markets. The orphan drugs portfolio currently features 10 treatments for rare and hard-to-treat diseases. For this division, Recordati develops products in-house and acquires them at a late stage, where some clinical evidence already exists that can limit the possible failure in the development process. In this division, growth will be fueled by the launch of Cystadrops (for nephropathic cystinosis), the U.S. launch of Carbaglu, the acquisition of the marketing rights in North America for Cystadane, and the launch of Legada, which Recordati acquired from Helsinn in December 2018. The underlying market for orphan drugs has great potential and Recordati has been able to create a track record in developing new products and building good relationships with patients associations and leading clinicians, providing a unique global platform able to sell and market rare disease products around the world. The OTC division also provides business stability. Growth in this division will partially derive from three new products Recordati has bought from Bayer's consumer health division for the French market: Transipeg, TransipegLIB (both macrogol-based laxatives for the treatment of symptomatic constipation in adults), and Colopeg, which is a large volume bowel cleanser indicated in preparation for endoscopic exploration. In the specialty and primary care division, Recordati's strategy is to focus mainly on manufacturing and marketing products licensed from third parties or bought via mergers or acquisitions. In S&P's view, this allows the group to be less capital-intensive than competitors as it requires less in-house research and development (R&D). This will bolster profitability but still requires the company to cover licensing and royalty costs. Recordati has a good reputation in the pharma industry, which enables it to in-license products thanks to its well-developed distribution platform and geographical reach. That said, this model limits the group's growth, which in S&P's view is too closely linked to the successful identification of acquisition targets among third-party products. This exposes the group to a potential lack of targets in the market, or expensive acquisitions with a long payback period. S&P said, "We understand that internal R&D is mostly used for the development of the orphan drugs division. In our view, Recordati's R&D investment is currently below market average; its R&D ratio was 8% of revenues in 2018. As a result, the pipeline in this division is not strong." Although company growth somewhat depends on externally sourced products, Recordati has demonstrated a track record in delivering organic growth and increasing profitability every year. Its reported EBITDA margin was 36.9% in FY2018. Margin growth is related to top-line growth, which is fueled primarily by Urorec and Livazo, the orphan drugs division, and successful in-licensing and acquisition activities. The group is well-diversified geographically, with no country accounting for more than about 20% of total revenues, no major concentration in one therapeutic area (the top exposure, cardiovascular, represents 28% of total revenues), and no single products that represent more than 10% of revenues (Zanidip generates about 9%). The main strengths of the business are its established track record in in-licensing products (27% of total products are licensed, by revenue in 2017; the rest are owned), careful selection of targets that suit the current portfolio, and its growth potential. The latter will come from expanding current products into new markets. The company can use its good relationships with the big pharma companies that are willing to collaborate with a reliable partner such as Recordati. The biggest cost for the company is staff; they are crucial to the business model--particularly the sales force. S&P said, "Our highly leveraged assessment of the financial risk profile reflects Rossini's 100% ownership by financial sponsor CVC Capital Partners and co-investors. It also reflects the fact that CVC and co-investors have 53.1% (net of treasury shares held by Recordati as of December 2018) ownership of Recordati (through Rossini and Rossini Sarl) after acquiring FIMEI, giving the private equity fund full control of Recordati, its dividend policy, and therefore access to 53.1% of dividends. We expect Rossini to post an S&P Global Ratings-adjusted ratio of funds from operations (FFO) to debt of about 6% and FFO cash interest coverage (including a dividend to minorities as a fixed charge) slightly below 2x over 2019-2020. "Our adjusted debt at transaction-closing primarily includes about EUR1,300 million senior secured notes due 2025 (split between EUR650 million fixed-rate notes and EUR650 million floating-rate notes), and EUR750 million deferred payment notes. "Our FFO calculation includes full EBITDA at Recordati and our treatment of the dividend to minorities as fixed financial charges given that Rossini has to fulfil its debt obligation. "We expect Rossini to generate discretionary cash flow of about EUR140 million-EUR150 million in 2019-2020 (after payment of interests and dividends to minorities). The rating is also supported by Recordati's healthy free operating cash flow (FOCF) generation, which we expect to be above EUR300 million in 2019. It will support Recordati's ability to distribute enough dividends to Rossini (53.1% of total dividend) to ultimately fund Rossini's interest obligation. "The stable outlook reflects our view that the performance of Rossini's operating subsidiary Recordati should be resilient and the company will be able to generate a stable S&P Global Ratings-adjusted EBITDA margin of 37.5%-38.5% during the next 12 months. In our view, the company's EBITDA margin should be supported by a more favorable product mix, offsetting some price pressures in the industry. Under our base-case scenario, we assume that the company will have a weighted-average adjusted FFO-to-debt ratio of about 6% over 2019-2020 and FFO cash interest coverage of about 2.0x in 2019-2020. "We could lower the rating if Rossini's FFO cash interest coverage falls below 1.5x. This could happen if Recordati suffered an operational setback affecting its top-line or profitability, possibly the result of an unexpected tightening of reimbursement terms, or increasing product competition reducing its ability to replace declining revenues with newly acquired licenses. "We could also consider a negative rating action if FOCF at the Recordati level deteriorates beyond our expectations, affecting its ability to pay dividends to Rossini. "We could consider an upgrade if the company demonstrates a sound track record of adjusted FFO to debt consistently above 12% and FFO cash interest above 2.0x on a sustained basis. Prospects for a higher rating would be supported by Recordati improving its profitability above the market average (40% S&P Global Ratings-adjusted EBITDA margin) due to successfully replenishing its pipeline after the expiry of patents." =========== R U S S I A =========== ACCEPT LLC: Assets Insufficient to Meet Liabilities --------------------------------------------------- Following the failure of Limited Liability Company Insurance Company Accept (further referred to as the Company) to duly comply with Bank of Russia instructions and its breach of financial stability and solvency requirements, the Bank of Russia by force of its Orders Nos. OD-2650 and OD-2651, dated October 12, 2018, suspended the Company's insurance license and appointed a provisional administration. The Company's failure to timely remedy breaches of insurance regulations entailed the revocation of its insurance license, by force of Bank of Russia Order ОD-2773, dated October 24, 2018. Acting within its mandate, the provisional administration established facts suggesting that efforts were made by the Company's executives and other unidentified persons towards withdrawal of corporate assets through purchases of illiquid securities, sale of assets and assignment of credit claims. The provisional administration estimates the value of the Company's property (assets) to be insufficient to meet its liabilities to creditors and mandatory payments obligations. The provisional administration applied to the Court of Arbitration of the Samara Region to declare the Company bankrupt. The Bank of Russia submitted the information on transactions suggesting criminal offence to the Prosecutor General's Office of the Russian Federation, the Investigative Department of the Ministry of Internal Affairs of the Russian Federation and the Investigative Committee of the Russian Federation for consideration and procedural decision making. The current development of the bank's status has been detailed in a press statement released by the Bank of Russia. TAGILANK JSC: Liabilities Exceed Assets, Assessment Shows --------------------------------------------------------- The provisional administration to manage JSC Tagilank (hereinafter, the Bank), appointed by virtue of Bank of Russia Order No. OD-1829, dated July 20, 2018, following the banking license revocation, in the course of the inspection of the Bank's financial standing established that the Bank's management conducted operations to divert funds through lending and disposing immovable property to organizations with dubious creditworthiness or which might deliberately default on their liabilities. The provisional administration estimates the value of the Bank's assets to be no more than RUR1,038 million, vs RUR1,142 million of its liabilities to creditors. On October 3, 2018, the Arbitration Court of the Sverdlovsk Region recognized the Bank as insolvent (bankrupt). The State Corporation Deposit Insurance Agency was appointed as a receiver. The Bank of Russia submitted the information on the financial transactions bearing the evidence of criminal offence conducted by the Bank's executives to the Prosecutor General's Office of the Russian Federation, the Ministry of Internal Affairs of the Russian Federation and the Investigative Committee of the Russian Federation for consideration and procedural decision-making. =========================== U N I T E D K I N G D O M =========================== ALTE LIEBE 1: S&P Withdraws 'CC' Rating on EUR102MM Sec. Notes -------------------------------------------------------------- S&P Global Ratings withdrew its 'CC' long-term issue rating on the EUR102 million senior secured amortizing notes, due 2025, issued by Jersey-based special-purpose vehicle Alte Liebe 1 Ltd. The outlook on the long-term issue rating was negative at the time of the withdrawal. Alte Liebe onlent the proceeds to eight wind farms companies totaling 142 megawatts in Germany. BETTER BATHROOMS: Cashflow Difficulties Prompt Administration ------------------------------------------------------------- Business Sale reports that thought to be the UK's largest independent bathroom retailer, Better Bathrooms has fallen into administration as a result of "severe cashflow difficulties". According to Business Sale, the company was forced to call in business recovery specialists FRP Advisory LLP to handle the administration process, with partners Phil Pierce -- phil.pierce@frpadvisory.com -- and Gary Blackburn -- gary.blackburn@frpadvisory.com -- appointed as joint administrators. Better Bathrooms has since ceased its trading operations, closing its doors to all 13 of its stores and two trade counters, Business Sale discloses. Commenting on the administration process, Mr. Pierce, as cited by Business Sale, said: "The challenges facing the UK retail industry are well known and are putting immense pressure on businesses operating in the sector. "Unfortunately, Better Bathrooms has suffered from severe cashflow difficulties and an extended period of soft trading, which has forced the business into administration. "Without significant investment or the cash to continue trading, the difficult decision was made to cease trading." DEBENHAMS PLC: Issues Another Profit Warning Amid Rescue Talks -------------------------------------------------------------- BBC News reports that struggling department store chain Debenhams has issued another profit warning as its sales continue to fall. According to BBC, in a trading update, the retailer said the forecast it made on January 10, when it said full-year profits were set to hit analysts' expectations of about GBP8.2 million, was "no longer valid". Like-for-like sales at the firm for the 26 weeks to March 2 were down 5.3%, BBC discloses. Debenhams said talks with stakeholders to put it on a firmer footing were "continuing constructively", BBC relates. The retailer, which issued three profit warnings last year, said it would provide a further update with its interim results statement, BBC recounts. "We are making good progress with our stakeholder discussions to put the business on a firm footing for the future," BBC quotes Sergio Bucher, the chief executive of Debenhams, as saying. "We still expect that this process will lead to around 50 stores closing in the medium term." He said the business would need the help of landlords and local authorities to address rent and rate levels and lease commitments, BBC notes. A month ago, the department store chain said it had been granted a cash injection of GBP40 million to buy it extra time as it battled to secure a longer-term deal with lenders, BBC discloses. It is also reportedly trying to accelerate plans to close stores and is expected to close around 20 outlets this year, BBC states. According to BBC, Laith Khalaf, from stockbrokers Hargreaves Lansdown, said: "Debenhams' future is hanging in the balance, and with short sellers circling too [share traders who believe the shares have further to fall], we can expect share price movements to be volatile." "The department store needs to stage a Lazarus-like recovery to turn things around from here." FINSBURY SQUARE 2019-1: Fitch Gives 'B(EXP)' Rating on Cl. X Notes ------------------------------------------------------------------ Fitch Ratings has assigned Finsbury Square 2019-1 PLC's notes expected ratings, as follows: Class A: 'AAA(EXP)sf'; Outlook Stable Class B: 'AA+(EXP)sf'; Outlook Stable Class C: 'A+(EXP)sf'; Outlook Stable Class D: 'BBB+(EXP)sf'; Outlook Stable Class E: 'BBB (EXP)sf'; Outlook Stable Class F: 'CCC(EXP)sf'; RE 90% Class X: 'B(EXP)sf'; Outlook Stable Class Z: 'NR(EXP)sf' The assignment of the final ratings is contingent on the receipt of final documents conforming to information already received. Finsbury Square 2019-1 PLC is a securitisation of owner-occupied (OO) and buy-to-let (BTL) mortgages originated by Kensington Mortgage Company in the UK. The transaction features recent originations of both OO and BTL loans originated up to January 2019, and the residual origination of the Finsbury Square 2016-1 plc transaction. KEY RATING DRIVERS Pre-funding Mechanism The transaction contains a pre-funding mechanism through which further loans may be sold to the issuer, with proceeds from the over-issuance of notes at closing standing to the credit of the pre-funding reserves. Fitch has received loan-by-loan information on additional mortgage offers that could form part of the collateral, once advanced by the seller. However, Fitch assumed the additional pool to be based on the constraints outlined in the transaction documents. Product Switches Permitted Eligibility criteria govern the type and volume of product switches, but these loans may earn a lower margin than the reversionary interest rates under their original terms. Fitch has assumed that the portfolio quality will migrate to the weakest permissible under the product switch restrictions. Help-to-Buy, Young Professional Products Up to 10% of the pool after prefunding may comprise loans in which the UK government has lent up to 40% inside London and 20% outside London of the property purchase price in the form of an equity loan. This allows borrowers to fund a 5% cash deposit and mortgage the remaining balance. When determining these borrowers' foreclosure frequency (FF) via debt-to-income (DTI) and sustainable loan-to-value (sLTV), Fitch has taken the balances of the mortgage loan and equity loan into account. In addition, a product targeting young professionals, launched in October 2018, could be included in the pre-funding pool (up to 5%). Self-employed Borrowers Kensington may lend to self-employed individuals with only one year's income verification completed or the latest year's income if profit is rising. Fitch believes this practice is less conservative than other prime lenders. Fitch applied an increase of 30% to the FF for self-employed borrowers with verified income instead of 20%, as per its criteria. CRITERIA VARIATIONS The adjustments applied to help-to-buy equity loans and self-employed borrowers as described above represent variations from Fitch's published criteria. RATING SENSITIVITIES Material increases in the frequency of defaults and loss severity on defaulted receivables producing losses greater than Fitch's base case expectations may result in negative rating action on the notes. Fitch's analysis showed that a 30% increase in the weighted average FF, along with a 30% decrease in the weighted average recovery rate, would imply a downgrade to 'AA-sf' from 'AAAsf'. GOSTLING LTD: Put Up for Sale, Administrators Appointed ------------------------------------------------------- Gostling Limited has been put for sale following the appointment of Henry Shinners -- henry.shinners@smithandwilliamson.com -- and Emma Thompson of Smith & Williamson as joint administrators of the Skipton, North Yorkshire-based accountancy practice. Details: -- GBP1 million turnover business specializing in taxation, start-up advice, compliance and bookkeeping services; -- approximately 300 corporate and 700 individuals (self-assessment) clients; and -- leasehold premises. Interested parties should e-mail jonathan.reason@smithandwilliamson.com or call 020-7131-4000 and ask for Mr. Reason or Mr. Shinners. Expressions of interest are requested as soon as possible and ideally before Wednesday, March 6, 2019. JAMES DOLAN: Enters Into CVA After Losing Major Customer -------------------------------------------------------- Sarah Chambers at East Anglian Daily Times reports that The James Dolan Group, an Ipswich haulage and warehousing group, is shedding 15 jobs and entering an arrangement with its creditors after one of its subsidiaries lost business from a major customer. The James Dolan Group, which employs about 90 staff overall, and has a turnover of GBP8 million, consists of James Dolan Limited (JDL) and its two operating subsidiaries, Green & Skinner (Haulage) Limited (GSH) and Dooley Rumble Group Limited (DRG), East Anglian Daily Times discloses. The business applied to the courts to enter a Company Voluntary Arrangement (CVA) on February 28, 2019, East Anglian Daily Times relates. "DRG was acquired by the group in October 2017. By mid-2018 it was apparent that sales and margins where not at the levels expected. In part this was due to a substantial loss in sales from one of the Export packing division's largest customer. This in turn impacted the freight forwarding division," East Anglian Daily Times quotes director James Dolan as saying. "Since then the group made various efforts to revive both divisions, but without success. This resulted in the difficult decision to close firstly the freight forwarding division and subsequently the Export Packing division, with the loss of 15 jobs. "The decision to try and trade out the poor performance has had a severely negative impact on cashflow, a situation that can only be resolved by restructuring the whole group. This restructure is expected to be resolved through the use of the CVA which will be overseen by specialist restructuring professionals." ********* 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 2019. All rights reserved. ISSN 1529-2754. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. The TCR Europe subscription rate is US$775 per half-year, delivered via e-mail. 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