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       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

          Tuesday, October 15, 2019, Vol. 20, No. 206

                           Headlines



B E L A R U S

EUROTORG LLC: Fitch Affirms 'B' LT Issuer Default Rating


C R O A T I A

3 MAJ: Accounts Temporarily Blocked Over Enforcement Proceedings
ULJANIK GROUP: Zagreb Stock Exchange to Delist Shares on Nov. 9


F R A N C E

ANDROMEDA INVESTISSEMENTS: S&P Assigns 'B' ICR, Outlook Stable
ELECTRICITE DE FRANCE: S&P Alters Outlook to Neg. on Operating Woes
RAMSAY GENERALE: S&P Affirms 'BB-' LongTerm ICR, Outlook Stable
VERALLIA SA: S&P Assigns BB- ICR on Successful IPO & Refinancing


G E O R G I A

GEORGIA: S&P Raises Sovereign Credit Ratings to BB


G E R M A N Y

IREL BIDCO: S&P Assigns 'B+' Issuer Credit Rating, Outlook Stable


L U X E M B O U R G

CURIUM BIDCO: Fitch Assigns B+ LongTerm IDR, Outlook Stable
TIGERLUXONE SARL: Moody's Withdraws B2 CFR on Debt Refinancing


N E T H E R L A N D S

ESPERITE NV: Board of Directors to Appeal Bankruptcy Verdict
[*] NETHERLANDS: Corporate Bankruptcies Barely Changed in September


P O L A N D

URSUS SA: Lublin Court Resumes Enforcement Proceedings


P O R T U G A L

ARES LUSITANI: Moody's Assigns Ca Rating on EUR7.6MM Cl. B Notes
BANCO COMERCIAL PORTUGUES: S&P Alters Outlook on ICRs to Positive
HAITONG BANK: S&P Raises ICR to 'BB' on Improving Capitalization


S P A I N

CAJAMAR PYME 2: Moody's Raises Rating on EUR240M Cl. B Notes to B2
CELLNEX TELECOM: S&P Affirms BB+ ICR on Sizable Equity Injection
OBRASCON HUARTE: Fitch Lowers LT IDR to CCC+, Outlook Stable


S W E D E N

IGT HOLDING IV: S&P Assigns 'B-' Long-Term ICR, Outlook Stable


S W I T Z E R L A N D

SIG COMBIBLOC: Moody's Raises CFR to Ba2, Outlook Stable
WALNUT BIDCO: S&P Assigns B+ Issuer Credit Rating, Outlook Stable


U N I T E D   K I N G D O M

BLERIOT MIDCO: Moody's Assigns B3 CFR, Outlook Stable
FINASTRA LIMITED: Fitch Lowers IDR to B & Alters Outlook to Stable
FINASTRA: S&P Affirms 'B-' ICR on Solid Operating Performance
SOLENIS UK: S&P Assigns B- Issuer Credit Rating, Outlook Negative
THOMAS COOK: EU Approves EUR380 Million Condor Rescue Loan


                           - - - - -


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B E L A R U S
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EUROTORG LLC: Fitch Affirms 'B' LT Issuer Default Rating
--------------------------------------------------------
Fitch Ratings affirmed LLC Eurotorg's Long-Term Issuer Default
Rating at 'B' with Stable Outlook.

The rating is underpinned by Eurotorg's strong market position in
Belarus's food retail market, moderate leverage and consistently
positive free cash flow generation. At the same time, the 'B' IDR
incorporates the company's small scale, limited diversification
outside its domestic market and high FX risks, which weigh on
Eurotorg's financial flexibility, balancing its conservative
capital structure relative to peers.

The Stable Outlook reflects its expectation that the company will
be able to resume growth in like-for-like (LfL) sales and stabilise
its EBITDA margin over 2020-2023 after a volatile operating
performance so far in 2019.

KEY RATING DRIVERS

New Stores Cannibalise Sales: Its rating case assumes that
Eurotorg's expansion is likely to continue to negatively affect
footfall at its existing stores as new stores cannibalise their
sales. Eurotorg's LfL sales have been falling since 4Q18 but some
stabilisation is likely from 2020 due to easier comparables and
more focused store roll-outs. Furthermore, Fitch expects LfL sales
to be supported by greater alignment of growth in average shopping
basket with food inflation than in 2019 when consumer spending was
affected by growth in utilities tariffs.

Customer Value Proposition Adjustment: Fitch observes that
Belarusian food retail competition continues to intensify as a
result of greater availability of funding for Belarusian
corporates. As a result Fitch concludes that Eurotorg needs to
reinforce the attractiveness of its customer value proposition to
protect its market leadership and brand strength. Eurotorg's
profitability in 1H19 was negatively affected by increased
promotional activity and launch of new discounter format Hit! as
the company aims to keep the distance in prices with its
competitors. Eurotorg's market position is already superior to
other Belarusian retailers as its market share is five times higher
than its largest competitor.

Drop in EBITDA: Eurotorg's Fitch-adjusted EBITDA fell by around 15%
in 1H19 and Fitch projects in its rating case that its recovery
will take time and will be conditioned upon resumption of LfL sales
growth, optimisation of in-store personnel and achievement of
targeted profitability by the new discounter format. Fitch also
assumes that Eurotorg may benefit from changes in product mix
(private label, own-production and non-food categories), which will
allow it to partly offset expansion-related growth in operating
lease expenses.

Moderate Leverage: Fitch anticipates an increase in the company's
funds from operations (FFO) adjusted gross leverage up to 4.5x
(2018: 3.8x) and then gradual deleveraging once its operating
performance stabilises. Its updated rating case demonstrates a
higher leverage profile but Eurotorg's capital structure remains
conservative and aligned with higher-rated peers. This balances the
company's exposure to FX risks and volatility of operating
performance.

Small Scale, Limited Diversification: The ratings take into account
the company's limited geographic diversification as it operates
only in Belarus. Eurotorg's presence across different regions of
the country puts it in a better position than competitors, but does
not reduce concentration risks, as Belarus is a small economy. The
small size of the reference market also leads to Eurotorg's
substantially lower business scale (2018 EBITDAR of around USD242
million equivalent) than other Fitch-rated food retailers, such as
Russian retailers X5 Retail Group N.V. (BB+/Stable) and Lenta LLC
(BB/Stable).

Positive FCF Despite Expansion: In its view, Eurotorg's ability to
generate consistently positive FCF, despite store roll-outs is
positive for the rating. Fitch projects the company to preserve a
positive FCF margin at 1%-2% (2018: 4.1%) as it pursues capex-lite
expansion strategy and opens primarily small leasehold stores. By
increasing its selling space, Eurotorg captures growth
opportunities for modern retail formats in Belarus as the market
remains dominated by traditional retail (2017: 54%).

High but Reducing FX Risks: Fitch views Eurotorg's financial
flexibility as improving as a result of the recent refinancing in
Russian roubles. Nevertheless, Fitch believes that the mismatch
between the currencies of Eurotorg's profits and debt will continue
to weigh on its credit profile, despite Belarusian and Russian
roubles having shown some correlation in the past.

In addition, part of Eurotorg's costs (2018: 2.6% of revenue)
remains exposed to FX risk as operating lease agreements are
primarily in hard currency. Fitch also assumes that financial
market development in Belarus will not allow the company to fully
switch the currency of its debt and operating lease agreements to
Belarusian roubles over the medium term.

Country Ceiling Constraint: In its rating analysis, Eurotorg's
Foreign-Currency IDR is constrained by Belarus' Country Ceiling of
'B' due to the absence of export earnings and foreign assets and
lack of financial support from foreign parent or strategic
partners. Should Belarus's Country Ceiling be raised, Fitch would
considers upgrading Eurotorg's Foreign-Currency IDR.

DERIVATION SUMMARY

Fitch applies its Food-Retail Navigator framework to assess
Eurotorg's rating and its position releative to peers. As a result
Fitch views Eurotorg's market position and bargaining power in
Belarus as stronger than those of Russian peers X5 Retail Group
N.V. and Lenta LLC in their respective market. This is due to the
large distance in market shares between Eurotorg and its next
competitor, and significant price advantage. However, in absolute
terms based on annual EBITDAR, Eurotorg is substantially smaller
than Russian peers and has material exposure to FX risks.
Furthermore, Eurotorg's rating is constrained by Belarus' Country
Ceiling of 'B'. As a result, Eurotorg is rated lower than Russian
peers, despite projected similar FFO adjusted leverage.

Eurotorg's ratings take into consideration higher-than-average
systemic risks associated with the Belarusian business and
jurisdictional environment.

No parent-subsidiary linkage aspects were in effect for these
ratings.

KEY ASSUMPTIONS

Fitch's Key Assumptions Within Its Rating Case for the Issuer

  - BYN/USD at 2.2 in 2019, 2.3 in 2020 and 2.5 in 2021

  - 7% growth in selling space in 2019 and 5% CAGR over 2020-2022

  - Decline in LfL sales due to sales cannibalisation offsetting
    increasing average ticket over 2019-2020 followed by a low
    single-digit growth in 2021-2022

  - EBITDA margin reduction to 6.7% in 2019; slight improvement in
    EBITDA margin over 2020-2022

  - Capex at BYN75 million-BYN80 million a year

  - Dividends at 50% of net income

  - No M&A

KEY RECOVERY RATING ASSUMPTIONS

Average Recoveries for Noteholders: Fitch rates Eurotorg's USD350
million loan participation notes (LPNs) in line with Eurotorg's 'B'
IDR, reflecting average recoveries in case of default under its
going concern scenario. The LPNs were issued by an SPV, which is
restricted in its ability to do business other than issue notes and
provide a loan to Eurotorg. The notes are secured by a loan to
Eurotorg, which ranks equally in ranking with the company's other
senior unsecured obligations. Eurotorg is the major operating
company within the group accounting for most of the group's assets
and EBITDA.

Key Recovery Rating Assumptions:

Its recovery analysis assumes that Eurotorg would be considered a
going-concern in bankruptcy and that the company would be
reorganised rather than liquidated. Fitch has assumed a 10%
administrative claim.

Eurotorg's going concern EBITDA is based on 2019 projected EBITDA,
discounted by 25%, reflecting FX risks, which are partly mitigated
by rising inflation in a currency devaluation scenario. It reflects
Fitch's view of a sustainable, post-reorganisation EBITDA level,
upon which Fitch based the valuation of the company.

An enterprise value (EV)/EBITDA multiple of 4.0x is used to
calculate a post-reorganisation valuation and reflects a mid-cycle
multiple. It is in line with EV multiples Fitch uses for Ukrainian
agricultural commodity processor Kernel and Ukrainian poultry
producer MHP.

For the debt waterfall assumptions Fitch used the group's debt at
June 30, 2019 pro forma for the issuance of RUB10 billion of
unsecured bonds and RUB3.5 billion of unsecured syndicated loan in
3Q19. Financial lease liabilities were not included in the debt
waterfall in line with its criteria.

The waterfall analysis generated a ranked recovery for senior
unsecured LPNs in the 'RR3' band, indicating a higher rating than
the IDR as the waterfall analysis output percentage on current
metrics and assumptions was 54%. However, the LPNs are rated in
line with Eurotorg's IDR of 'B' as upwards notching is not possible
due to the Belarusian jurisdiction. Therefore the waterfall
analysis output percentage remains capped at 50%.

RATING SENSITIVITIES

Developments That May, Individually or Collectively, Lead to
Positive Rating Action

An upward revision of the Belarus Country Ceiling (currently 'B')
would be a pre-requisite for any upgrade.

  - Successful execution of expansion strategy as evidenced by
    growing LfL sales and stable profitability, leading to

FFO adjusted leverage sustainably below 4.0x and FFO fixed charge
coverage above 2x.

  - Sustained positive FCF and maintenance of conservative
    financial policy.

  - Adequate access to external liquidity.

Developments That May, Individually or Collectively, Lead to
Negative Rating Action

  - Sustained operating underperformance, including declining LfL
    sales and profitability leading to FFO adjusted leverage
    sustainably above 5.0x and FFO fixed charge coverage below 2x.

  - Negative FCF or deterioration in access to external liquidity.

  - Downward revision of Belarus Country Ceiling.

LIQUIDITY AND DEBT STRUCTURE

Comfortable Liquidity: At end-June 2019, Fitch views the liquidity
available for Eurotorg as adequate as its cash (BYN158 million) and
expected positive FCF is sufficient to cover short-term debt of
BYN101 million. Liquidity was further supported by BYN249 million
availability under the company's undrawn committed credit lines.
Fitch does not expect any major refinancing needs as proceeds of
the recently issued RUB10 billion (BYN323 million) bonds and RUB3.5
billion (BYN109 million) syndicated loan will be used to repay
existing debt.




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C R O A T I A
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3 MAJ: Accounts Temporarily Blocked Over Enforcement Proceedings
----------------------------------------------------------------
SeeNews reports that Croatian shipyard 3. Maj said on Oct. 14 its
accounts have been temporarily blocked over enforcement proceedings
launched by an unnamed company.

According to SeeNews, 3. Maj said in a filing with the Zagreb Stock
Exchange the shipyard has taken the appropriate legal action
against the proceedings since it does not recognize the respective
claims as overdue and expects the issue to be resolved within a
reasonable period of time.

The announcement comes several weeks after the commercial court in
Riejka decided not to launch bankruptcy proceedings against 3. Maj
because the company had proved it had settled all overdue debt and
submitted evidence showing its account was no longer blocked over
unpaid debt, SeeNews discloses.

The court's decision came after the government decided to issue
guarantees for a HRK150 million (US$22 million/EUR20 million)
life-saving loan from the state-owned development bank HBOR, aimed
at helping 3. Maj pay wage arrears and restart production, SeeNews
notes.

A condition for the loan approval was that all 3. Maj creditors,
including the state, had to agree to postpone until September 1,
2021 the repayment of debt owed to them by the shipyard.  3 Maj is
part of troubled shipbuilding group Uljanik, SeeNews states.

In May, a Croatian court launched bankruptcy proceedings against
Uljanik Shipyard and the Uljanik Group on a request by the
country's financial agency, citing the firms' overdue debt, SeeNews
recounts.


ULJANIK GROUP: Zagreb Stock Exchange to Delist Shares on Nov. 9
---------------------------------------------------------------
SeeNews reports that the Zagreb Stock Exchange (ZSE) said it will
delist the shares of local shipbuilding group Uljanik, which is
undergoing bankruptcy proceedings.

According to SeeNews, the bourse said in a statement on Oct. 9
Uljanik Group's shares will be delisted on Nov. 9 and their last
trading day will be Nov. 8.

The ZSE said it has taken the decision to delist the company after
receiving on Oct. 7 a request for the move from the group's
bankruptcy trustee, SeeNews notes.

In May, the commercial court in Pazin decided to launch bankruptcy
proceedings against Uljanik Group, several days after opening such
proceedings against its key member Uljanik Shipyard, SeeNews
recounts.

Uljanik Group has been in financial trouble in the past years due
to the adverse effects of the global financial crisis on the
shipbuilding sector with the government declining to endorse
earlier this year a proposed restructuring of the two shipyards,
considering the risk for the country's economy as too big, SeeNews
discloses.

In late 2018, the government had to pay state guarantees worth
HRK2.54 billion on behalf of the troubled Uljanik Group, after the
group failed to meet contractual obligations, SeeNews relays.




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F R A N C E
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ANDROMEDA INVESTISSEMENTS: S&P Assigns 'B' ICR, Outlook Stable
--------------------------------------------------------------
S&P Global Ratings assigned its 'B' ratings to Andromeda
Investissements and its senior secured debt, as well as its '3'
recovery rating to the debt.

Andromeda Investissements initial acquisition of 65.13% of APRIL's
share capital triggered a mandatory tender offer for the remaining
34.87% held by minority interests. This saw CVC successfully
increase the holding to 88.9% and gain majority voting rights,
however, S&P does expect the firm to try to achieve 100% ownership
in the future. The outcome has no effect on S&P's ratings.

The ratings reflect the company's leading market position in France
as a wholesale insurance broker for a number of niche segments,
primarily health insurance, credit protection, disability and death
protection, and some property and casualty niche products. In S&P's
view, the group's market positions are supported by its
well-recognized brand, and its large network of 12,000 active
brokers.

S&P believes APRIL benefits from its mix of end customers -- small
businesses, senior citizens, and self-employed workers -- as well
as the favorable underlying growth prospects of its key health and
credit protection segments. A general increase in health care
spending, France's ageing population, and political and regulatory
decisions that have increased the share of private health insurance
compared with public health care benefit APRIL's health insurance
business. Furthermore, credit protection insurance growth is
expected to be boosted by the "Bourquin" law, implemented in
January 2018, which allows creditors to change their insurance
policy on each anniversary date. This should support growth in
individual delegated credit protection insurance, APRIL's target
segment.

Furthermore, APRIL's good revenue visibility thanks to its
medium-to-long-term contracts (five years for health insurance, on
average, and eight years for credit protection), and its
well-diversified broker and end-client bases, provide additional
support to the business risk profile. This protects the group from
significant volatility in revenue and earnings, even in the case of
client or distributor losses.

These strengths are, however, constrained by the group's relatively
small size compared with large international insurance brokers such
as Willis Towers Watson PLC (BBB/Stable/--) or Marsh & McLennan
Cos. (A-/Negative/A-2); and its narrow business scope, with a focus
on health and protection insurance products that represent close to
70% of its brokerage EBITDA. The insurance brokerage market is very
fragmented and competitive, with limited barriers to entry. APRIL's
relatively small size and niche focus could make the group
vulnerable to increased competition, should large international
peers decide to strengthen their presence in the French market.

S&P said, "In addition, we view APRIL's geographic concentration in
France, where it generates about 85% of revenue, as another
weakness. This concentration makes the group vulnerable to
regulatory developments affecting the French health care system and
credit protection insurance framework. Although recent regulatory
developments have supported APRIL's business, this has not always
been the case. For instance, the Accord National Interprofessionnel
disrupted APRIL's health insurance activities and profitability in
2016 by causing a decline in the individual health insurance
market, the company's target segment at the time.

"We assess APRIL's profitability differently from its peers due to
the group's specific business model as a wholesale broker. APRIL's
brokerage revenue includes fixed commissions earned on premiums
volume and variable commissions on insurers' profits. However,
APRIL has to share these commissions with retail brokers who
operate as distributors for its products. This business model
offers more flexibility and downside protection, in our view, than
if APRIL had to bear the labor costs of a large sales force, or the
fixed costs of a dense agency network. Although this model has not
translated into stronger profitability compared with peers -- APRIL
has adjusted EBITDA margins of 13%-14% compared with 20%-30% for
Willis Tower Watson, Marsh & McLennan, and Hyperion Insurance Group
Ltd.(B/Stable/--)--it has provided more stable EBITDA margins.

"In addition to focusing on brokerage business, APRIL has
historically retained some insurance risk, but a significant
portion of its insurance activities are reinsured. We view the
insurance business as supporting APRIL's brokerage core business.
APRIL mainly underwrites health and protection products (about 60%)
and some property and casualty risks (about 40%). The company also
benefits from structurally strong margins on these selected
products. As such, in our view, the insurance risk-carrying
activities will support stable cash flow generation in the near
term.

"Our assessment of APRIL's financial risk profile incorporates our
expectation of adjusted debt to EBITDA of about 6.0x at year-end
2019. Although we forecast deleveraging in the next two years, in
the absence of discretionary spending or shareholder friendly
actions, our assessment is also influenced by the company's
financial sponsor (FS) ownership. As a result, we view the risk of
the re-leveraging of APRIL's capital structure as high. We note
that CVC will provide equity in the form of a shareholder loan. We
have excluded this financing from our financial analysis, including
our leverage and coverage calculations, since we believe the
common-equity financing and the noncommon-equity financing are
sufficiently aligned. We believe the FS will not exercise any
credit rights associated with the shareholder loan.

"We anticipate improving EBITDA margins over the forecast period,
supported by the growth in new profitable businesses, divestment of
less profitable activities, and efficiency and information
technology improvements. We view positively the company's good
EBITDA to operating cash flow conversion and its ability to
generate free operating cash flow (FOCF), supported by the low
expenditure requirements given APRIL's well-invested platform. We
forecast underlying annual FOCF generation of EUR30 million-EUR40
million in 2019-2020, which represents more than 5% of adjusted
debt and provides good prospects for deleveraging.

"Furthermore, the group's comfortable cash interest coverage ratios
help sustain the group's high leverage, in our view.

"The stable outlook reflects our view that APRIL will continue to
see strong demand for its brokerage services over the next 12
months, supporting sound organic growth. It also incorporates our
view that the company will maintain resilient EBITDA margins,
resulting in adjusted debt to EBITDA of 5.5x-6.0x and positive
FOCF.

"We could lower the ratings if APRIL experienced a material decline
in profitability or higher volatility in margins due to unexpected
operational issues or adverse regulatory developments, as well as
negative FOCF on a prolonged basis. Additionally, if funds from
operations (FFO) cash interest coverage reduced to below 2.0x due
to weakening operating performance, we would consider lowering the
rating.

"We could consider an upgrade if APRIL improved its S&P Global
Ratings-adjusted debt to EBITDA to less than 5.0x, in line with a
higher financial risk profile assessment. A positive rating action
would also depend on the shareholder's commitment to demonstrating
a prudent financial policy and maintaining credit metrics at this
level."


ELECTRICITE DE FRANCE: S&P Alters Outlook to Neg. on Operating Woes
-------------------------------------------------------------------
S&P Global Ratings revised the outlook on Electricite de France
S.A. (EDF) to negative, reflecting increased operational risks
related to evidence of weak management of complex new nuclear
projects, and the potential reduction of financial headroom if
further risks materialize.

S&P said, "Our negative outlook on EDF highlights increased
operational risks related to new nuclear projects, which results in
lower cash flow predictability, and our belief the group is less
likely to fulfill strategic projects. We believe the ongoing
complex new nuclear builds contribute to the group's deeply
negative free operating cash flow (FOCF) and that associated costs
overruns exacerbate the company's rising debt trajectory. In
addition, the cash flow contribution from these assets remains some
way off, and we still have uncertainties regarding their value
creation potential in case of further woes during the construction
life."

On Sept. 25, 2019, the group announced higher estimated completion
costs on HPC in the U.K., now estimated at GBP21.5 billion-GBP22.5
billion. This comes on top of an increase in the group's possible
commissioning delay risk, possibly entailing a further GBP0.7
billion in costs. This is the second time EDF is revising up the
HPC budget, and represents a 25% deviation from the initial budget
of GBP18 billion in 2016. The overall return on investment will
decrease subsequently to 7.6%-7.8%, a level closer to the company's
weighted-average cost of capital. S&P thinks this is low in light
of the project's construction risks, with a limited risk-sharing
pass-through feature. The range provided depends on the
effectiveness of action plans to be delivered in partnership with
contractors.

The higher costs at HPC come on top of the commissioning delay at
FLA-3 announced in July, with the reactor now postponed to year-end
2022 at the earliest. This followed ASN's June 19, 2019,
announcement that welds would need to be repaired at the site. On
Oct. 9, EDF announced a remedy plan, with associated cost overruns
of EUR1.5 billion and the final schedule confirmed for year-end
2022. The total cost of the project amounts to EUR12.4 billion.

S&P said, "Although not correlated, we view the accumulation of
issues at EDF's large nuclear projects as evidence of project
management issues. In our view, this may be detrimental to the
future of the group's strategic plan in nuclear power, notably
regarding any additional domestic or international projects. We
also note that the French economy minister has launched an
independent audit on the French nuclear industry and on the
decision-making around the EPR reactor technology, with the
conclusions to be submitted on Oct. 31, 2019. That said, we believe
that the French government still supports EDF's strategy (see
section below on potential market reform)."

EDF is also facing technical issues with the steam generators at
six French reactors. The company and its nuclear reactor
engineering division Framatome informed ASN on Sept. 9, 2019, of
deviations from technical standards regarding the manufacturing of
some steam generators installed in French power plants. EDF has
identified the reactors potentially affected (six out of its fleet
of 58) and discerned the nature of the technical issue--a quality
deviation from a post-weld detensioning heat-treatment process on
the steam generators. Nevertheless, the potential implications of
any remedial work remain uncertain. Although EDF reiterated in its
Sept. 18 press release that the reactors are safe to operate and
require no immediate action, S&P believe this situation signals
increased operating risk for EDF, and that its materiality will
need to be assessed following ASN's further review.

S&P understands that ASN will provide a preliminary opinion in
about a month. In the event of severe safety issues that require a
shutdown of up to six reactors, nuclear output would be
significantly lower than currently forecast and the financial
impact could be material.

Furthermore, EDF's sizable investment plans are leading to negative
cash flows and rising debt. The plans include very high maintenance
and upgrade expenditure on the existing nuclear fleet and
construction of nuclear power plants in France and the U.K. This
comes on top of ambitious investments in renewables and sizable
investments in networks, leading to about EUR15 billion of spending
each year. S&P said, "We believe this investment plan has very low
flexibility. We anticipate that, under our power price assumptions
(see below), these high investments will translate into large
negative FOCF over 2019-2020 of EUR2 billion-EUR3 billion, with low
visibility on working capital swings."

S&P said, "Our assessment of EDF's financial risk profile is
underpinned by its high, adjusted debt, as a result of these
sizeable negative cash flows and increases in nuclear/pension
provisions in a lower-for-longer interest rate environment. Notably
we forecast an increase in nuclear provisions in 2019-2020 of about
EUR2 billion from a revision of the discount rate by 0.2%, and a
potential risk that our adjusted credit metrics may weaken."

This effectively results in adjusted debt increasing by at least
EUR3 billion per year, from about EUR70 billion in 2018 to above
EUR78 billion in 2021, despite the credit supportive measures in
the form of scrip dividends consented to by the French government
(for a combined effect of about EUR1.5 billion) and asset disposals
(EUR2 billion-EUR3 billion over 2019-2021).

S&P said, "However, we also expect EBITDA growth to accelerate over
the forecast period, supported by power prices, resulting in
adjusted funds from operations (FFO) to debt remaining above 19%
(19.4% in 2018, under our new ratios and adjustments calculation)
and debt to EBITDA remaining close to 4.5x over 2019-2021.
Nevertheless, we expect management will remain committed to its
financial policy and maintain its willingness to take further
remedial measures to protect the group's credit quality over the
coming years.

"Since EDF presented its 2018 results, we view positively
management's clear and stated focus over the past few months on two
structural pillars for the group's credit quality. These include
potential changes to the regulation of its French nuclear
activities in 2020-2021 and, if it materializes, the ensuing
organizational changes. We note a strong alignment of interests on
the regulatory need for these changes between the French government
and EDF.

"In our view, profound structural changes in the French market are
needed to eventually reposition the economics of EDF's French
nuclear fleet. Specifically, this means the recognition that
sustainable remuneration is needed for baseload energy (the minimum
amount of power needed to be provided to the grid), and a potential
departure from Regulated Access to Incumbent Nuclear Electricity's
pricing mechanism, which currently sets a partial cap on prices for
the output of the existing nuclear fleet.

"We understand a structural regulatory reform that is positive for
EDF's nuclear operations will take time and will need to be agreed
with the European Commission. Furthermore, we understand any
proposal of group reorganization, as requested by the French state,
would be linked to progress on the regulation and would most likely
be delayed to first-semester 2020, as opposed to year-end 2019
initially."

The French state's recent decision (announced in February 2019) to
elect for scrip the balance of its 2018 dividends as well as those
in fiscals 2019 and 2020 supports our assessment of a high
likelihood of extraordinary government support for EDF, if needed.
This confirms a supportive stance from the French government, which
was also shown in 2017 in the form of a capital increase and scrip
dividends.

What's more, EDF is at the core of the government national energy
policy Programmation pluriannuelle de l'energie (PPE). The new
energy roadmap over 2019-2028 highlights France's pro-nuclear
stance and nuclear power's key place in the French energy mix for
the next decade. PPE also sets ambitious targets to significantly
increase the share of renewables in the generation mix, spurred by
a push for new solar and wind capacity.

S&P said, "The negative outlook on EDF reflects our view of
increased operational risks materialized through significant cost
deviations and commissioning delays at new nuclear projects, namely
FLA-3 and HPC.

"We expect an increasing debt trajectory over 2019-2021 due to
negative discretionary cash flows. We anticipate that the group's
S&P Global Ratings-adjusted FFO to debt will stay at about 19%, and
debt to EBITDA will remain close to 4.5x, in the context of a
supportive power price environment.

"We could consider a negative rating action if we see no clear
progress toward positively changing regulation for its existing
French nuclear fleet (or on changes in market design). This would
result in the persistent and high structural exposure of the
group's cash flows to market volatility given its still-material
investment phase.

"Rating pressure would also stem from FFO to debt falling below 17%
and debt to EBITDA failing to stay below 4.5x, levels we do not
deem commensurate with our 'A-' rating. This could notably arise
from further deviations in nuclear operations, a material upward
revaluation of the group's nuclear provisions, or a sharp
deteriorating price environment, although with a lag of
two-to-three years due to hedges in place."

A stable outlook depends heavily on the group's reorganization as
well as the nature and effective implementation of EU-backed
regulation, allowing the group to better cover the economic cost of
its existing French nuclear fleet. Additionally, S&P would view
favorably the implementation of remedy measures designed to
reinstate financial flexibility.


RAMSAY GENERALE: S&P Affirms 'BB-' LongTerm ICR, Outlook Stable
---------------------------------------------------------------
S&P Global Ratings affirmed its long-term 'BB-' ratings on Ramsay
Generale de Sante (RGdS) and its existing senior secured
facilities.

S&P said, "The affirmation reflects our view that RGdS' underlying
performance remains robust, despite our forecast that S&P Global
Ratings-adjusted leverage will increase, due to a
higher-than-expected operating lease adjustment disclosed under
International Financial Reporting Standard (IFRS) 16. We therefore
now project that debt protection metrics will be at the lower end
of the range for our "highly leveraged" financial risk profile over
the coming 24 months.

"Ramsay leases a large portion of its real estate, leading to a
large adjustment for lease obligations in our debt estimate.
Following adoption of IFRS-16, we align with the group's
disclosure, in which it estimated debt would be EUR1.8
billion-EUR2.3 billion for fiscal year ended June 30, 2020
(FY2020). This is higher than we anticipated in our previous base
case. The difference reflects management's low discount rate
(compared with the 7% reflected in our previous calculation) and
the relatively long-dated lease contracts with its lessors.

"Our financial risk assessment now reflects our core adjusted
credit metrics of debt to EBIDTA of 5.5x-6.5x over the next 12-24
months. Our debt estimates include senior secured bank debt of
EUR1.6 billion, EUR430 million of other debt, approximately EUR2.3
billion in obligations under operating leases, and EUR90 of pension
obligations. We net EUR400 million of cash against debt. We do not
expect RGdS to materially reduce its sizable adjusted debt in
2020-2021. Note that if we had used the lower end of the group's
guidance, our core adjusted credit metrics of debt to EBIDTA would
be 5.0x-6.0x over the forecast horizon.

"We forecast adjusted EBITDA of about EUR600 million-EUR700 million
over the next 12-24 months. Our forecast reflects assumptions of
full integration of Capio, a supportive regulatory and
reimbursement environment, especially in its main market France,
and gradual improvement in profitability-driven cost initiatives
and synergies on procurement.

"We forecast the group will be able to generate like-for-like
revenue growth of 1.5%-2.5% over 2020-2021, slightly outpacing the
health care market. This is in line with 2019 reported growth of
2.1%. We believe Ramsay will benefit from its large scale, which
helps it secure sufficient volumes, and government subsidies to
compensate health care providers for their efforts to enhance
quality. In our view, private operators will continue to gradually
gain market share from the public sector since the government
favors cost-efficient operators and the private sector is well
positioned for the ongoing shift to short stays (ambulatory
procedures now represent about 68% of total procedures for RGdS).

"We understand that RGdS will continue to focus on improving
operating efficiency, through the gradual implementation of the
shared service center, investments in digital innovation, and
ability to optimize resources through clusters. This should enable
Ramsay's profitability to gradually improve toward 15%-16% in
FY2020 and 16%-17% in FY2021, from 14.3% in FY2019. In FY2019, our
adjusted EBITDA of EUR488 million included about EUR24 million of
restructuring costs. We excluded about EUR21 million of the EUR45
million incurred restructuring costs, as we considered that they
were linked to the transformative buyout of Capio. We believe
restructuring costs will be lower in subsequent periods.

"As such, we anticipate free operating cash flow (FOCF) to be above
EUR60 million in 2020, reflecting working capital outflow of about
EUR10 million and capital expenditures (capex) of about EUR200
million-EUR210 million, fueled by investments in modernization of
facilities and new digital tools.

"Due to the high proportion of rents in the group's servicing
structure, we estimate the fixed-charge cover ratio (adjusted
earnings before interest, taxes, depreciation, amortization, and
rent divided by rents and cash interest) to be about 1.7x–2.0x in
our base case. This reflects all-in rent expense of EUR300
million-EUR310 million, and interest expense of EUR60 million-EUR65
million over the next two years.

"We now apply a positive comparative rating analysis modifier to
reflect Ramsay's large portion of lease-related debt in its capital
structure, which displays a better maturity profile compared with
traditional financial debt. The group's strong cash flow generation
is also supportive of the 'BB-' rating.

"We assess majority owner RHC's group credit profile as stronger
than RGdS' stand-alone credit profile. However, the ratings on RGdS
do not currently include any uplift for group support.
The stable outlook reflects our view that RGdS' increased scale and
operating model should enable the group to improve its
profitability, while maintaining an adjusted fixed-charge coverage
ratio of more than 1.7x-2.0 over the next 12-24 months and
generating FOCF of above EUR60 million, enabling an adjusted
debt-to-EBITDA ratio of 5.5x-6.5x.

"We could consider lowering the ratings if the group's operating
performance deteriorates such that its cash flow generation is
hampered by substantial working capital outflows or
higher-than-forecast capex or if it fails to maintain adequate
headroom under its revolving credit facility (RCF) springing
covenant."

This would broadly correspond to the fixed-charge coverage ratio
falling below 1.5x. The most likely cause of such a deterioration
would be if the group failed to achieve forecast growth and realize
the productivity gains necessary to cover its fixed cost base or if
the operating environment deteriorated, putting pressure on
margins.

S&P said, "We could also consider lowering the rating if Ramsay
pursued a predominantly debt-funded acquisition strategy that would
lead to S&P Global Ratings-adjusted debt to EBITDA of more than
6.5x over the next 12 months.

"We view an upgrade as remote in the next 12-24 months in the
context of the current capital structure." However, ratings upside
could follow materially reduced leverage such that adjusted debt to
EBITDA dropped below 5.0x and the group's servicing of its fixed
obligations, such as interest and rent payments, strengthened to
above 2.2x and the group committed to maintaining this level in the
future.

RGdS is the largest private hospital operator in France (with a 21%
share of the private market) and in Sweden (with a 7% market share)
since its acquisition of Capio. The group also has a limited
presence in Norway, Denmark, Italy, and Germany (see chart).

RGdS operates primarily in medicine, surgery, and obstetrics (MSO),
which make up 89% of its revenue, the remainder coming from
rehabilitation and recuperative care (6%) and mental health (5%)
revenue. S&P notes that, at this stage Capio is considered 100%
MSO. In France, the group operates 75 MSO hospitals, 27 subacute
facilities, and 35 mental health clinics with about 25,000 beds.

For FY2019, the group generated revenue of EUR3,401 million and S&P
Global Ratings-adjusted EBITDA (after rent expense) of EUR487.5
million.

RGdS has been jointly owned by Ramsay Health Care (52.53% of
shares) and Credit Agricole Assurances (Predica) (39.62%) since
2014.


VERALLIA SA: S&P Assigns BB- ICR on Successful IPO & Refinancing
----------------------------------------------------------------
S&P Global Ratings assigned a 'BB-' issuer credit rating to
France-based glass packaging producer Verallia S.A.

S&P is withdrawing its ratings on Verallia's subsidiaries Horizon
Holdings I and Horizon Parent Holdings S.a r.l. Meanwhile, S&P is
raising its issuer credit rating on Verallia Packaging S.A.S., the
borrower of the new unsecured debt facilities, to 'BB-' from 'B+'.

On Oct. 4, 2019, Verallia successfully completed its IPO on
Euronext Paris. Between 17.9% and 20.7% of its shares are now
publicly listed. The remainder is jointly owned by Apollo and BPI
(61.1%-63.9%); Brasil Warrant Administracao de Bens e Empresas S.A.
(8.6%); managers (4.9%); BPI directly (1.3%); and others.

The sponsors repaid the EUR350 million payment-in-kind (PIK) toggle
notes with part of the proceeds from the IPO. S&P is therefore
withdrawing its ratings on the issuer of the PIK toggle notes,
Horizon Parent Holdings S.a r.l.

Verallia also refinanced its senior secured facilities with a
EUR1.5 billion unsecured term loan and a EUR500 million undrawn
unsecured revolving credit facility (RCF) borrowed by Verallia
Packaging S.A.S. S&P is raising its issuer credit rating on the
latter entity to 'BB-' from 'B+'.

The refinancing extends Verallia's debt maturity profile and
reduces its interest cost.

S&P said, "We now expect debt to EBITDA of 4.2x for year-end 2019,
compared with our previous (pre-IPO) expectation of 4.8x.
Similarly, we now forecast funds from operations (FFO) to debt of
18.1% for 2019, compared with pre-IPO expectations of 13.5% to
14%.

"Verallia publicly committed to a debt-to-EBITDA ratio of 2x-3x
(3.1x to 4.4x on an S&P Global Ratings-adjusted basis) over
2020-2022. The one-notch upgrade reflects our view that the new
leverage target reflects a more conservative financial policy.

"Nevertheless, our rating continues to reflect Verallia's majority
ownership by financial sponsors, which have historically pursued
aggressive financial policies. Together, Apollo and BPI now jointly
own between 61.1% and 63.9% of shares and voting rights, compared
with over 90% before the IPO. In addition to this, BPI now also
directly owns 1.3% of shares. We could consider raising the rating
once we see further evidence, and some track record, of the
sponsors pursuing a more conservative financial policy.

"The stable outlook reflects our expectation of moderate revenue
growth and stable EBITDA margins. Meanwhile, the company's
financial sponsor ownership continues to constrain our assessment
of its financial policy.

"We would consider a further upgrade once the company builds a
track record of adhering to its more conservative financial policy,
maintaining sustained adjusted debt to EBITDA of below 5.0x.

"We would downgrade Verallia if we continue to see the company as
highly leveraged or carrying out an aggressive financial policy.
This could be the case if leverage or dividends exceed its publicly
targeted levels."




=============
G E O R G I A
=============

GEORGIA: S&P Raises Sovereign Credit Ratings to BB
--------------------------------------------------
S&P Global Ratings, on Oct. 11, 2019, raised its long-term foreign
and local currency sovereign credit ratings on the Government of
Georgia to 'BB' while affirming the short-term ratings at 'B'. The
outlook is stable.

Outlook

The stable outlook reflects the balance of risks between the
potential for some erosion of institutional checks-and-balances and
external vulnerabilities on the one hand, and upside to Georgia's
growth prospects on the other.

S&P could raise the ratings if Georgia's growth rates translate
into higher income levels while its exports profile diversifies
further, both in terms of product and geography.

Downward ratings pressure could build if Georgia's institutional
arrangements weakened and led to less predictable policymaking, as
well as hurting business confidence and growth prospects.

Rationale

Georgia has maintained comparatively high growth rates over the
past few years, even in a challenging external environment. The
economy expanded by nearly 4% on average over 2015-2018, weathering
periods of anemic external demand as trading partners were hit by
falling oil prices, regional currencies were devalued, and some
fell into recession.

This resilience partly reflects the economy's success in attracting
funds from abroad to finance its investment needs and its external
deficits. At 33% and 5.7% in 2018, Georgia's investment-to-GDP and
net FDI-to-GDP ratios are among the highest of all the 'BB'
category sovereigns we rate. While we expect the external
environment to remain challenging, policymakers' efforts to widen
Georgia's economic base, to diversify its export geography and
foreign investment, and to develop its infrastructure are likely to
keep the pace of economic growth above that of peers while,
ultimately, further reducing external imbalances--albeit the
process will be only gradual.

In our view, continued growth of the NBG's FX reserves should help
mitigate any immediate balance-of-payments risks. The NBG's
reserves have increased by $250 million on average every year since
2016. Part of this momentum stems from the IMF program, in place
since 2017, and higher reserve requirements for commercial banks
against FX liabilities. However, the increase is also a result of
the NBG's FX purchases. Indeed, FX reserves net of FX liabilities
have been increasing and we expect this to continue over the medium
term.

The ratings on Georgia continue to be supported by the country's
relatively strong institutional arrangements in a regional
comparison, and our forecast that net general government debt will
remain contained, at close to 43% of GDP until year-end 2022.

The ratings are constrained by GDP per capita of $4,300 in 2019,
which remains low in a global comparison, as well as by
balance-of-payments vulnerabilities, including Georgia's import
dependence and sizable external liabilities.

Institutional and Economic Profile: Various policy initiatives
underpin an improved economic resilience

-- Georgia's economy remains narrow and characterized by
comparatively low per capita income levels.

-- Nevertheless, S&P expects the authorities' reform focus should
support sustained growth of 4% on average annually over the medium
term--higher than Georgia's key trading partners.

-- Although shortcomings persist, S&P expects Georgia's
institutional framework will remain among the strongest in the
region.

In the last couple of years, net exports have emerged as a key
growth driver for the Georgian economy. In particular, exports to
the EU grew by 30% since the signing of the Deep and Comprehensive
Free Trade Area Agreement between Georgia and the EU in 2016.
Tourism, copper ores, ferro-alloys, wine, and medicines have all
shown material growth over this period, suggesting some
geographical widening of the export basket. With exports comprising
more than half of GDP in 2018, Georgia is now a more open economy
compared to 2016 (when exports were about 44% of GDP) or a decade
ago when exports were less than one-third of national income. S&P
projects that the share of exports to GDP will stabilize from now
on, and domestic demand will be the main growth driver over the
forecast horizon.

Russia's ban on flights to Georgia from July following a series of
protests in Tbilisi appears to have contributed to a slowing of
tourism revenues relative to 2018. However, the effect of the
Russian sanctions has been relatively limited as they were
restricted to direct flights and not extended to other areas--such
as Georgian wine--nor were there restrictions on the Georgian
workforce in Russia, an important, albeit diminishing, source of
remittance inflows. Arrivals of Russian tourists by land and
flights via other destinations into Georgia continue. S&P
understands that there is potential for the Russian authorities to
lift the embargo, as suggested by their recent comments.

S&P said, "Georgia's economy grew by nearly 5% in real terms in the
first half of the year. Incorporating a slight slowdown in the
second half--lower tourism revenues and muted consumption following
the lari's depreciation--we project real GDP growth of 4.5% in
2019. We have revised up this estimate from our previous 4.0% for
the full year. We expect growth to moderate over the forecast
horizon for a number of reasons. These include muted growth in
Russia and Turkey, the latter emerging from a recession; a slowdown
in the EU, where over 20% of Georgia's goods exports go; and slower
consumption growth stemming from a moderation in credit growth
following the authorities' introduction of new macroprudential
norms for consumer leverage. We still see potential Turkish lira
and Russian ruble volatility as a downside risk. Both are important
trade partners, accounting for a combined 20% of exports and 40% of
inbound worker remittances.

"That said we believe that Georgia's economy will continue to grow
at a comparatively high 4% annually over 2019-2022. We expect it to
grow faster than other countries in the region." Georgia's
long-established floating exchange rate regime, with intermittent
intervention from the NBG, remains particularly important. Against
a weaker external environment, the exchange rate has previously
adjusted promptly, helping avoid any abrupt one-off swings. Among
other things, this has preserved the stability of the financial
system and allowed Georgia to avoid the credit crunch that hit some
other countries in the region in recent years and aggravated other
economic problems.

The authorities' reform focus could yield additional growth
benefits, particularly in the long run. Current initiatives
include:

-- Development of the country's infrastructure and prioritizing
capital spending (capex) rather than current budget expenditure;

-- Improvements in the business environment, including through the
introduction of a new private partnership framework, deposit
insurance, land reform, and pension reform;

-- Tax reforms aimed at easing compliance and addressing the issue
of value-added tax refunds; and

-- Education reform.

S&P said, "Despite the strong growth outlook, we expect Georgia's
per capita income will remain modest at below $5,000 through 2022.
This largely reflects the low starting base, exemplified by the
prevalence of exports of low-value-added goods. In the agricultural
sector, which employs a substantial part of Georgia's population
(the IMF estimates that close to 40% of employment is related to
agriculture), productivity remains comparatively low, weighing on
Georgia's average per capita GDP. This, in turn, continues to
constrain the sovereign ratings.

"In our view, Georgia's institutional settings remain favorable in
the context of the region, with several established precedents
regarding power transfer, and a degree of checks and balances
between various government bodies. We also note the NBG's broad
operational independence. We do not expect significant changes to
these institutional arrangements over our four-year forecast.

"Nevertheless, we see some downside risks from the ruling Georgian
Dream party's majority in parliament should it use this majority to
solidify its incumbent position. The domestic political landscape
in Georgia has also seen heightened volatility recently with
several public protests in 2019 and 2018. We consider that
political uncertainty will likely stay elevated in the run-up to
the parliamentary elections in 2020, but we do not expect any
detrimental shifts to economic policymaking and anticipate a
continued broad focus on reforms and attracting foreign
investment.

"We continue to see risks from regional geopolitical developments.
The status of South Ossetia and Abkhazia will likely remain a
source of dispute between Georgia and Russia. Russia has continued
to build stronger ties with the two territories, as highlighted by
the partial integration of the South Ossetian military into the
Russian army, the establishment of a customs post in Abkhazia, and
regular visits to the territories by senior Russian government
officials. However, we do not expect a material escalation and we
anticipate the conflict will remain largely frozen over the medium
term. The protests in Georgia in June and the subsequent flight ban
by Russia marked a reversal in the otherwise improving bilateral
relations between the two countries in other areas in recent
years."

Flexibility and Performance Profile: S&P anticipates that the NBG
will continue to accumulate FX reserves, partially mitigating
external risks

-- S&P expects net general government debt to peak in 2021 at 43%
of GDP.

-- External metrics will improve through 2022 as the NBG continues
to build up reserves and the current account deficit narrows.

-- A floating exchange rate and the NBG's overall operational
independence underpin a degree of monetary flexibility, but the
high level of dollarization remains a constraint.

S&P said, "We see Georgia's balance of payments position as
vulnerable. Georgia remains a small, open economy with a narrow
export base and a significant net external liability position built
on persistent past current account deficits. Ultimately, this
leaves the economy susceptible to changing external sentiment.
While one-third of external debt belongs to the public sector, is
concessional, and has long-dated maturities, the economy overall
needs to roll over almost 30% of GDP in foreign debt annually,
potentially exposing it to adverse external conditions. This
percentage includes nonresident deposits as well as trade credit
extended to the domestic corporate sector. Although Georgia's
external position remains vulnerable, NBG's strengthened FX
reserves partially mitigate the risks, in our view."

Georgia's accumulated stock of inward FDI remains substantial, at
over 160% of the country's generated current account receipts,
exposing the sovereign to risks should foreign investors decide to
leave, for example because of changes in the business environment
or a deterioration in Georgia's economic outlook. While a
hypothetical sizable reduction in FDI inflows may not necessarily
lead to a disorderly adjustment involving abrupt lari depreciation
(due to a simultaneous corresponding contraction in FDI-related
imports), it will likely have implications for Georgia's growth and
employment.

The sizable stock of foreign liabilities also has consequences for
the current account deficit. S&P said, "We note that the income
deficit has widened, averaging nearly 5% of GDP in 2016-2018, from
an average of 2% over 2013-2015. Even then, in our opinion, Georgia
is less vulnerable to shifts in investor sentiment given the small
proportion of market-based portfolio financing it receives relative
to FDI and concessional debt."

Following the completion of a foreign-funded gas pipeline project,
inward FDI has reduced and is expected to average just over 7% of
GDP over the forecast, compared with more than 11% between 2014 and
2017. Because a substantial portion of imports was FDI-related, we
expect the current account deficit to narrow further to below 7.0%
in 2019 and average 6.3% through 2022. The growth in services
exports--reflecting tourism revenue and transit fees--should also
continue to help stabilize the external deficit, mitigating the
growth in interest and dividends paid on foreign liabilities. In
2018, the services balance was nearly 14% of GDP, up from 3% a
decade ago.

Supporting the accumulation of FX reserves, the authorities
introduced a rule-based purchasing (put) option in early 2019 that
allows banks to sell foreign currency to the NBG when the exchange
rate is on an appreciating trend.

The NBG also continues to purchase FX via auctions. To date, in
2019, net FX purchases by the NBG have totaled $228 million. NBG FX
reserves peaked at $3.74 billion in June this year (2.5x the level
in 2008) before declining slightly following FX sales in August and
September--the first since 2016--to curb the lari's depreciation.
The NBG targets FX reserves based on an "assessing reserve
adequacy" metric agreed with the IMF. This measure has strengthened
over the last year with the authorities estimating that it
currently stands at just over 100%.

Low fiscal deficits and moderate government debt characterize
Georgia's public finances. The general government deficit has
averaged 2.4% since 2011, exceeding 3.0% in only one year. Gross
government debt has remained about 45% of GDP since 2016. However,
this ratio is very sensitive to exchange rate movements given the
large share of foreign-currency-denominated debt (80%) in the
overall stock. For instance, S&P projects that general government
debt to GDP will rise somewhat in 2019 as a result of the 10%
(year-to-date) lari depreciation after Russia's July ban on direct
flights to Georgia. Similarly in 2015 and 2016, the lari
depreciation caused a nearly 10% jump in the government debt
ratio.

S&P expects that the pace of net debt accumulation will recede over
the forecast horizon and net general government debt to GDP will
peak in 2021 at 43%. The government typically only borrows for
capital projects and from official sources of financing, mainly
from international financial institutions (IFIs), as opposed to
commercial sources. In fact, excluding capex, the government has
consistently run an operating surplus. The preponderance of IFI
debt has contributed to a favorable debt structure, with an average
maturity of nearly eight years and a weighted average interest rate
of just over 3%. S&P currently considers that the contingent fiscal
liabilities stemming from public enterprises and the domestic
banking system are limited.

Through 2019, inflation has exceeded 4% (outside the NBG's 3%
target) owing to a hike in tobacco excises; core inflation has
however been relatively subdued. Moreover, the weaker lari has also
affected inflation. Further to its FX sales, the NBG hiked its key
policy rate to 7% in September; moreover, it has not ruled out
raising the rate to stem currency losses.

In S&P's view, the effectiveness of Georgia's monetary policy
compares favorably in a regional context. Specifically:

-- Inflation has remained consistently low, averaging less than 4%
over 2010-2018. S&P anticipates the central bank will broadly meet
its inflation target of 3% from 2020 onward;

-- Given the floating exchange rate regime, Georgia has promptly
adjusted to changing external conditions while also avoiding abrupt
and damaging swings in the real effective exchange rate in either
direction; and

-- The banking system remains on a relatively stable footing. S&P
notes that nonperforming loans (based on the NBG's calculation)
peaked at 7%-8% even though the lari weakened notably in 2015-2016,
while economic growth decelerated. According to the IMF's
calculations, nonperforming loans amounted to 3% in March 2019.

High levels of dollarization continue to constrain the
effectiveness of monetary policy despite declines in recent years,
in S&P's view. Deposit dollarization at 62% is still significant,
though down from 70% in 2016. Positively, S&P notes the
authorities' efforts to reduce the economy's dollarization,
including through differentiating liquidity requirements for
domestic and foreign currency liabilities, implementing pension
reforms, developing the domestic debt capital market, and
introducing deposit insurance, alongside other measures.

S&P said, "We anticipate that, over the next four years, the stock
of domestic credit will expand by 14% a year on average (including
foreign exchange effects), below the 19% trend between 2013 and
2018. Although pockets of vulnerability remain, particularly in
retail lending, we view positively the regulator's attempts to
diffuse risks. The introduced measures include loan-to-value and
payment-to-income limits, additional capital requirements for
systemic banks, and bolstered nonbank sector supervision.

"We do not expect the ongoing investigation into specific
shareholders of TBC Bank on allegations of wrongdoing to become a
broader issue, either for the bank or for the system as a whole.
However, we note that, at nearly 40% of net system loans and
liabilities, the bank has systemic importance."

In accordance with S&P's relevant policies and procedures, the
Rating Committee was composed of analysts that are qualified to
vote in the committee, with sufficient experience to convey the
appropriate level of knowledge and understanding of the methodology
applicable. At the onset of the committee, the chair confirmed that
the information provided to the Rating Committee by the primary
analyst had been distributed in a timely manner and was sufficient
for Committee members to make an informed decision.

After the primary analyst gave opening remarks and explained the
recommendation, the Committee discussed key rating factors and
critical issues in accordance with the relevant criteria.
Qualitative and quantitative risk factors were considered and
discussed, looking at track-record and forecasts.

The committee's assessment of the key rating factors is reflected
in the Ratings Score Snapshot above.

The chair ensured every voting member was given the opportunity to
articulate his/her opinion. The chair or designee reviewed the
draft report to ensure consistency with the Committee decision. The
views and the decision of the rating committee are summarized in
the above rationale and outlook. The weighting of all rating
factors is described in the methodology used in this rating
action.

  Ratings List

  Upgraded; Outlook Action; Ratings Affirmed
                                    To            From
  Georgia (Government of)

  Sovereign Credit Rating         BB/Stable/B     BB-/Positive/B
  Senior Unsecured                BB              BB-
  Transfer & Convertibility
   Assessment                     BBB-            BB+




=============
G E R M A N Y
=============

IREL BIDCO: S&P Assigns 'B+' Issuer Credit Rating, Outlook Stable
-----------------------------------------------------------------
S&P Global Ratings assigned its 'B+' long-term issuer credit
ratings to Irel BidCo S.a.r.l. and its financing subsidiary Irel
AcquiCo GmbH, and its 'B+' issue rating to the first-lien debt.

S&P aid, "Our assessment of the business risk profile reflects
IFCO's leading niche market position in Europe and the U.S. as the
largest independent provider of RPC solutions for the supply chain
of fresh products. IFCO's products are mainly used to package fruit
and vegetables. We also consider the resilience of the RPC business
in our assessment. We regard the sector's end markets as being
generally recession-resistant."

IFCO has a worldwide pool of 290 million RPCs, which the company
manages for a wide-ranging and diverse group of customers,
including over 320 retailers and 14,000 producers/growers in 52
countries. Its scale and network advantages are difficult and
costly to replicate and serve as a barrier to entry. Other barriers
to entry include the high capital intensity required to maintain
the asset pool, and the logistics and distribution infrastructure
requirements.

In S&P's view, IFCO's network of wash centers across all major
growing regions is essential to its delivery of top-quality service
to customers. In addition, its ownership of intellectual property
rights for RPCs reduces its reliance on suppliers.

Moreover, retailers are typically reluctant to terminate their
long-term contracts with IFCO because of high switching costs of
exchanging the large RPC pools. Europe, which accounts for 70% of
IFCO's revenue, is a retailer-dominated market. IFCO has lost only
three contracts over the past 10 years.

S&P said, "We view as positive the solid fundamentals of the
underlying RPC market, which we estimate comprises 14.5 billion
packaging units (including one-way packaging). IFCO's accumulated
share of this market amounts to about 20%.

"We consider that the sector has decent potential for expansion.
Not only do RPCs have relatively low penetration, there are also
plausible drivers that could encourage greater penetration into end
markets. These include increasing packaging
standardization/automation, pressure on retailers to find cost
efficiencies, and a focus on environmental sustainability.

"At the same time, substitution risk from traditional packaging,
such as corrugated cardboard boxes and wood containers, is
mitigated by RPCs' advantages, which include better handling
efficiency and product protection, more efficient temperature
regulation, easier in-store display, and less waste and
environmental impact."

IFCO has demonstrated a solid track record of stable earnings and
profitability throughout economic cycles. It weathered the
2008-2009 financial crisis and its EBITDA margins have been 23%-25%
over the past three years. S&P anticipates that the company will be
able to sustain its profitability levels, underpinned by its good
grip on cost control; improving utilization of fixed costs as new
contract wins come on stream; and flexible cost structure,
underpinned by a large variable component.

These strengths are partly constrained by IFCO's narrow business
scope and diversity. Its business model is built around RPC
operations and it has a large concentration on retailers as
ultimate customers--Europe's top five retailers account for about
40% of European RPC volumes. The company's main geographic focus is
the mature European market, where IFCO generates about two-thirds
of its revenues.

In S&P's view, geographic diversity may improve over time if IFCO
succeeds in capitalizing on its established foothold in the
attractive and fast-expanding markets in Latin America, China, and
Japan. However, winning a share of a new market tends to be a
long-term process, because of low RPC penetration and differing
market characteristics.

IFCO's second-largest market North America, for example, is
dominated by growers, rather than retailers and is characterized by
relatively long transportation distances between growers,
distribution centers, and retail stores. Retailers in the U.S. use
RPCs from almost all providers, because the choice is frequently
determined by their suppliers. RPCs in the U.S. are also
standardized, which lowers the barriers to entry. Although this
reduced the risk of losing a retailer, volumes must be shared with
other RPC providers and won from individual suppliers.

S&P expects the company's adjusted debt to EBITDA will remain at
about 5.5x in the following 12 months on stable earnings and
margins (compared with about 5.6x at transaction closing).

The acquisition financing included $911 million of preference
shares as an equity injection by major shareholders Triton and
ADIA. S&P said, "We view this shareholder instrument as
equity-like, reflecting our view that the economic incentives align
with common equity. The preference shares are structurally
subordinated, with no cash payments, no events of default,
cross-default, or cross-acceleration in the documentation. We
understand that no cash can be upstreamed to Triton and ADIA unless
net debt to EBITDA is maintained at 4.5x or below." There is also a
limit on the amount of cash that may be upstreamed: the higher of
EUR25 million or 10% of company EBITDA (about $30 million).

The ratings are in line with the preliminary ratings S&P assigned
on March 25, 2019.

S&P said, "The stable outlook reflects our view that IFCO will
maintain modest revenue growth and stable EBITDA margins, resulting
in adjusted debt to EBITDA that remains at about 5.5x, while
generating positive FOCF.

"We could consider an upgrade if IFCO demonstrated a more prudent
financial policy, such that adjusted debt to EBITDA improves to
below 5.0x on a sustainable basis. We consider that a positive
rating action would be also contingent on IFCO retaining its
competitive strengths and stable profitability.

"Based on the strength of IFCO's business profile, we consider the
company has ample headroom under the forecast credit ratios for any
unexpected high-impact events, which makes a rating downgrade
unlikely over the next 12 months.

"However, we could consider a downgrade if IFCO pursued material
discretionary spending such as a debt-funded acquisition or
shareholder returns that result in adjusted debt to EBITDA
weakening materially above 6.0x for a prolonged period.

"We could also lower the rating if IFCO experienced unforeseen
setbacks in operating performance that had an adverse impact on the
company's stable earnings and profitability. This could arise, for
example, if it lost major retailer contracts, or saw intensified
pricing pressures or operational disruption."




===================
L U X E M B O U R G
===================

CURIUM BIDCO: Fitch Assigns B+ LongTerm IDR, Outlook Stable
-----------------------------------------------------------
Fitch Ratings assigned the nuclear medicine specialist Curium Bidco
S.a.r.l a final Long-Term Issuer Default Rating of 'B+' with a
Stable Outlook. Fitch has also assigned a final senior secured
rating of 'BB-'/'RR3' to instruments issued by Curium.

The assignment of the final instrument ratings is in line with the
expected ratings (assigned in June 2019), given that the final
terms were consistent with the draft finance documentation.

The 'B+' IDR reflects Curium's market leading position in a niche
and defensive industry that benefits from significant barriers to
entry, evident in Curium's strong EBITDA margins. Unlike other
highly-leveraged private equity sponsored healthcare groups, the
financial profile also underpins the 'B+' rating given a relatively
moderate (versus 'B' category rated peers) post transaction funds
from operations adjusted leverage of 5.5x. Additionally, Curium's
capacity to deleverage is facilitated by high free cash flow
margins that are forecast to remain above 10% over the four-year
rating horizon. The rating also considers Curium's product
concentration to the nuclear medicine industry as well as the
moderate execution risks associated with an acquisitive strategy
with a limited track record.

The Stable Outlook reflects its expectation of steady underlying
operations with sustainably positive organic revenue growth
underpinning the launch of new product lines and acquired
revenues.

KEY RATING DRIVERS

Strong Position in Niche Market: The rating reflects Curium's solid
market leadership in the nuclear medicine industry, with no other
competitor able to service Curium's current geographical footprint
or product range. The constituent parts of what now forms Curium,
have demonstrated historical retention rates (over 95%), with
client contracts averaging three years. Contractual annual
re-pricing is inherent in the majority of US contracts, supporting
profit stability. The company's vertical integration allows Curium
to have control from the sourcing of radioactive substances to the
distribution of products to end users underpinning a robust
business model.

Industry with High Barriers to Entry: In Fitch's opinion, the
creation of Curium consolidated key markets (US and EU), further
entrenching the position of existing players, as entry into the
niche industry would require a significant up-front capital
investment, which acts as a key deterrent to new entrants including
larger medical devices conglomerates. Additionally, the nuclear
medicine industry exhibits very high barriers to entry as strict
regulatory approvals are required from both nuclear and medical
agencies, as well as clearance at various customs for
transportation. Fitch expects that new entrants to the market would
have to obtain similar regulatory approvals even if they are only
competing against one particular part of Curium's integrated
model.

Moderate Execution Risks: Fitch believes that Curium will continue
its acquisitive strategy as this is central to the value creation,
particularly from the sponsors' perspective. Its view of moderate
execution risks reflects the broad scope of possible future
acquisitions, and subsequent integration, of which there is a
limited track record. Being vertically integrated offers a variety
of opportunities for further consolidation, which creates some
uncertainty as to how the business model will evolve over the
rating horizon. This is because the integration of further
acquisitions will be key as invariably additional acquisitions may
not operate in the same protective environment that yield high
EBITDA margins, diminishing FCF generation and the group's ability
to deleverage.

Limited Product Diversification: Product diversification and scale
currently constrains Curium's rating at 'B+'. Despite being a
dominant player in a niche industry, an upgrade is currently
unlikely as there is limited scope for growth beyond a nuclear
medicine speciality. A meaningful increase in Curium's scale would
most likely be achieved via debt-funded M&A, which in turn would
likely change the company's leverage profile. Moreover, demand
driving for higher volume may be curtailed by high switching costs
involved for existing users of alternative scanners (CT and MRI).

High FCF Supports Deleveraging: Fitch projects that the FCF margin
will materially increase to 10% over the rating horizon from low
single digits in FY18. A combination of a lower cost of debt (part
of the transaction), margin improvement and lower capex will drive
the increase in FCF. High FCF margins would allow the group to
pursue non-debt funded M&A (depending on its size). Nevertheless,
there is significant headroom in the senior facilities agreement
documentation for dividend payments that may quickly erode the
capacity for non-debt funded M&A.

Modest Leverage versus Peers: Fitch views starting FFO adjusted
leverage at 5.5x at end-2019 as adequate for the rating, and
expects it to reduce to 4.0x over the rating horizon. Fitch-rated
peers, such as European Lab Testers Synlab (B/Stable), have around
3.0x more leverage than Curium, but well-established business
models combined with longer track records compared with Curium
offset the higher leverage for the ratings.

DERIVATION SUMMARY

Fitch applies its rating navigator framework for producers of
medical products and devices in assessing Curium's rating strength,
also against peers. Larger medical devices focused peers such as
Boston Scientific (BBB/Stable) and Fresenius Medical Care
(BBB-/Stable) do not necessarily relate to Curium's line of
business. Nevertheless, both issuers clearly illustrate the
benefits of size upon ratings (over EUR10 billion revenue) and
diversified product offering, which in the case of Fresenius
offsets around 4.0x FFO adjusted leverage for an investment grade
rating.

Compared with specialist generic pharmaceutical producers such as
Stada (B/Stable), Curium's business risk profile benefits from
operating in protected niche markets, albeit with lower scale and
diversification. However, this is also compensated by lower
financial leverage at Curium, which supports the higher rating.

The differentiating factors between Curium and "buy and build"
European lab testing companies such as Synlab are the higher levels
of leverage (8.0x), Curium's diversified geographic footprint and
evident protected position in a niche market relative to European
lab testers.

KEY ASSUMPTIONS

  - Mid to high single digit growth (7.5%) CAGR with the launch of
new product lines and M&A acquired revenues underpinned by organic
growth;

  - Gradual improvement in the EBITDA margin reflecting the spare
capacity in Curium's existing infrastructure and integration of
further bolt-on acquisitions;

  - EUR50 million of bolt-on acquisitions per year from FY20,
purchased at 10x EV/EBITDA multiples;

  - Pre-factoring working capital outflow equivalent to 1% of
revenues;

  - Moderate capital intensity of 5%;
  
  - Receivable factoring treated as debt with incremental use of
the facilities to maintain total drawings at 7.5% of revenues;

  - RCF to remain undrawn;

  - No dividends expected to be paid.

Recovery Assumption

  - The recovery analysis assumes that Curium would be restructured
as a going concern rather than liquidated in a hypothetical event
of default;

  - Curium's post-reorganisation, going-concern EBITDA reflects
Fitch's view of a sustainable EBITDA that is 33% below the 2019
Fitch forecast EBITDA of EUR165 million. In such a scenario, the
stress on EBITDA would most likely result from of operational
or/and regulatory issues;

  - Distressed EV/EBITDA multiple of 6.0x has been applied to
calculate a going-concern enterprise value; this multiple reflects
the group's strong infrastructure capabilities, leading market
positions and FCF;

Based on the payment waterfall the revolving credit facility of
EUR120 million ranks pari-passu with the senior secured term loans.
Therefore, after deducting 10% for administrative claims, its
waterfall analysis generates a ranked recovery for the senior
secured loans in the 'RR3' band, indicating a 'BB-' instrument
rating: one notch above the IDR. The waterfall analysis output
percentage on current metrics and assumptions was 65%.

RATING SENSITIVITIES

Developments That May, Individually or Collectively, Lead to
Positive Rating Action

  - Better product and geographical diversification indicative of
successful operational integration and execution of acquisitions;

  - Enhanced profitability evident in improved scale and pricing
power;

  - Maintenance of a conservative policy leading to limited
dividend payments and/or debt-funded M&A driving FFO adjusted gross
leverage below 4.0x on a sustained basis.

Developments That May, Individually or Collectively, Lead to
Negative Rating Action

  - FFO adjusted gross leverage above 5.5x on a sustained basis;

  - Operational challenges or loss of contracts that would lead to
a stable decline in revenues eroding the EBITDA margin from its
current position;

  - Loss of regulatory approval relating to the handling/processing
of nuclear substances and/or key products in core markets (US and
EU);

  - FCF margin below 5% on a sustained basis.

LIQUIDITY AND DEBT STRUCTURE

Comfortable Liquidity: Pro-forma to the current transaction, Fitch
expects Curium to have access to around EUR29 million cash on
balance sheet as well as an undrawn EUR120 million revolving credit
facility. The group is inherently cash generative so depending on
M&A activity, Fitch expects positive FCF generation to add to the
cash buffer over the rating horizon. Available factoring facilities
in key markets also support Curium's liquidity position.


TIGERLUXONE SARL: Moody's Withdraws B2 CFR on Debt Refinancing
--------------------------------------------------------------
Moody's Investors Service, withdrawn TigerLuxOne S.a.r.l's B2
corporate family rating and B2-PD probability of default rating, as
well as the B1 instrument ratings on the senior secured first lien
term loan B and the senior secured revolving credit facility
borrowed by Regit Eins GmbH and TV Borrower US, LLC. At the time of
the withdrawals, Teamviewer carried a stable outlook.

Moody's has withdrawn the ratings following the refinancing of all
debt which was conducted in line with the initial public offering
of the company.




=====================
N E T H E R L A N D S
=====================

ESPERITE NV: Board of Directors to Appeal Bankruptcy Verdict
------------------------------------------------------------
Reuters reports that Esperite NV's board of directors disputes the
bankruptcy verdict and will appeal the court order.

The court in Gelderland, Netherlands, declared Esperite in
bankruptcy on October 8, 2019, Reuters relates.

Headquartered in the Netherlands, Esperite NV owns and operates
blood stem cell banks in Europe.


[*] NETHERLANDS: Corporate Bankruptcies Barely Changed in September
-------------------------------------------------------------------
Statistics Netherlands (CBS) reports that the number of corporate
bankruptcies in the Netherlands has hardly changed.

There were 4 fewer bankruptcies in September 2019 than in the
previous month, CBS notes.  The trend has been relatively stable in
recent years, CBS states.

According to CBS, if the number of court session days is not taken
into account, 240 businesses and institutions (excluding one-man
businesses) were declared bankrupt in September 2019. With a total
of 61, the trade sector suffered most.

Trade is among the sectors with the highest number of businesses,
CBS discloses.  In September, the number of bankruptcies was
relatively highest in the sectors accommodation and food services,
construction and transport and storage, CBS relates.





===========
P O L A N D
===========

URSUS SA: Lublin Court Resumes Enforcement Proceedings
------------------------------------------------------
Reuters reports that Ursus SA said on Oct. 11 that the bailiff of
the district court in Lublin has resumed the suspended enforcement
proceedings initiated on motion filed by PKO BP.

Ursus SA, formerly POL-MOT Warfama SA, is a Poland-based company
engaged in the manufacture of agricultural machinery.





===============
P O R T U G A L
===============

ARES LUSITANI: Moody's Assigns Ca Rating on EUR7.6MM Cl. B Notes
----------------------------------------------------------------
Moody's Investors Service assigned definitive ratings to Notes
issued by Ares Lusitani -- STC, S.A.:

  EUR47.5 million Class A Asset-Backed Floating Rate Notes due
  2039, Definitive Rating Assigned Baa3 (sf)

  EUR7.6 million Class B Asset-Backed Floating Rate Notes due
  2039, Definitive Rating Assigned Ca (sf)

Moody's has not assigned any rating to the EUR 15M Class J
Asset-Backed Variable Return Notes due 2039.

This is the third transaction rated by Moody's that is backed by
Portuguese non-performing loans. The loans have been originated by
Caixa Economica Montepio Geral, CEB, S.A. (B1 LT Bank Deposits /
Ba3(cr)). The receivables supporting the Notes are NPLs with a
gross book value of EUR 234.3 million and an unpaid principal
balance of EUR 206.6 million. The total issuance of Class A, Class
B and Class J Notes is equal to EUR 70.1 million, 29.9% of the
total pool GBV. The pool consists of defaulted secured and
unsecured loans. The defaulted secured loans are equal to EUR 96.0
million of GBV and are backed by residential, commercial/industrial
properties and land located in Portugal. Of the EUR 96.0 million
secured loans, EUR 23.8 million are backed by mortgages that have
an outstanding senior claim, with EUR 50.9 million (53.1% of the
secured pool GBV) extended to individuals and EUR 45.0 million
(46.9% of secured pool GBV) extended to companies. The pool also
contains defaulted loans with no security currently attached, for
an amount equal to around EUR 138.3 million. Of these unsecured
loans, EUR 116.2 million (84.0% of unsecured pool GBV) were
extended to corporates and EUR 22.1 million (16.0% of unsecured
pool GBV) to individuals.

Cumulative net collections received as of the July report are 6.2
million, below the initial business plan forecast of 8.0 million.
The servicer has attributed the weaker than expected performance to
delays in the onboarding process, and has provided Moody's with a
plan describing how the initially expected performance levels will
be achieved in the following months.

The secured and unsecured portfolios will be serviced by Proteus
Asset Management, Unipessoal Lda., (referred to within the
documentation as "Altamira", NR). The servicing activities
performed by the servicer are monitored by the monitoring agent,
KPMG & Associados -- SROC, S.A..

Mimulus Finance D.A.C.(NR) is the seller, a special purpose vehicle
incorporated in Ireland. The seller purchased the portfolio from
CEMG shortly before entering into a sale agreement with the issuer,
which issued the Notes for the purpose of funding the purchase of
the NPL portfolio from the seller.

Ertow Asset Management, S.A. (NR) has been appointed as asset
manager at closing. The asset manager will be a limited liability
company with the sole purpose of managing and promoting the
disposal of the properties to third parties from enforcement on the
mortgage loans. The asset manager will not benefit from the
statutory segregation and the privileged credit entitlement
foreseen in the Portuguese Securitisation Law. However, a number of
contractual mechanisms have been put in place to mitigate the risk
of the asset manager's insolvency and mitigate the risk of third
party claims being made against the asset manager.

RATINGS RATIONALE

Moody's ratings reflect an analysis of the characteristics of the
underlying pool of defaulted loans, sector-wide and originator and
servicer-specific performance data, protection provided by credit
enhancement, the roles of external counterparties and the
structural integrity of the transaction.

In order to estimate the cash flows generated by the pool, Moody's
used a model that, for each loan, generates an estimate of: (i) the
timing of collections; and (ii) the collected amounts, which are
used in the cash flow model that is based on a Monte Carlo
simulation.

Collection Estimates: The key drivers for the estimates of the
collections and their timing are: (i) the historical data received
from the servicer, which shows the historical recovery rates and
timing of the collections for secured and unsecured loans; (ii) the
portfolio characteristics; and (iii) benchmarking with comparable
EMEA NPLs transactions.

The portfolio is split as follows: (i) 31.2% in terms of the total
pool GBV are individuals, while the remaining 68.8% are companies;
(ii) loans representing around 59.0% of the GBV are without any
security currently attached, while the remaining 41.0% of the GBV
are secured loans of which 24.8% are secured with an outstanding
senior claim; and (iii) of the secured loans, approximately 63.9%
are backed by residential properties, and the remaining 36.1% by
different types of non-residential properties.

Hedging: As the collections from the pool are not directly linked
to a floating interest rate, a higher index payable on the Notes
would not be offset with higher collections from the pool. The
transaction therefore benefits from an interest rate cap, linked to
six-month EURIBOR, with J.P. Morgan AG (Aa1(cr)/P-1(cr)) as cap
counterparty. The cap will have a strike that changes for each
payment date with the cap notional being subject to a predefined
schedule. The interest rate cap will terminate in May 2029.

Transaction Structure: The transaction benefits from an amortising
liquidity reserve initially equal to 4.0% of the Class A balance,
equivalent to EUR 1.88 million at closing. The liquidity reserve
will remain at its initial level until the payment date in November
2020, after which it will amortise to a required amount of 3.0% of
the Class A Notes. However, Moody's notes that the cash reserve is
not available to cover Class B Notes' interest. Further, Class B
interest will be subordinated upon certain performance triggers
being breached. An additional expense account has been opened in
the name of the issuer and the amounts standing to the credit of
the account will be available to cover senior costs and expenses
relating to any and all expenses incurred by the servicer in
recovering the loans. At closing, the accounts are funded at EUR
0.95million.

Servicing Disruption Risk: Moody's has reviewed procedures and
practices of Altamira and found it to be acceptable in the role of
servicer. The liquidity reserve together with the expenses account
is sufficient to pay around 12 months of interest on the Class A
Notes and items senior thereto. The limited liquidity in
conjunction with the lack of a back-up servicer means that
continuity of Note payments is not ensured in case of servicer
disruption. This risk is commensurate with the rating assigned to
the most senior Note.

True Sale and Transfer of Security: The assignment of the
receivables constitutes a valid and true sale of the receivables.
However, assignment of the secured loans can only be deemed
effective against third parties following registration of such
assignment on behalf of the issuer and the asset manager. Moody's
has received confirmation from Altamira that all the registration
of the mortgage assignment from Mimulus (the seller) to Ares
Lusitani - STC, S.A. (the issuer) were requested and accepted
before the Real Estate Registry.

Principal Methodology

The principal methodology used in these ratings was "Moody's
Approach to Rating Securitizations Backed by Non-Performing and
Re-Performing Loans" published in February 2019.

FACTORS THAT WOULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS:

Factors that may lead to an upgrade of the ratings include that the
recovery process of the defaulted loans produces significantly
higher cash flows/collections in a shorter time frame than
expected. Upgrades would be constrained within the Baa range due to
operational risk considerations.

Factors that may cause a downgrade of the ratings include
significantly less or slower cash flows generated from the recovery
process compared with its expectations at close due to either a
longer time for the courts to process the foreclosures and
bankruptcies, a change in economic conditions from its central
scenario forecast, or idiosyncratic performance factors. For
instance, should economic conditions be worse than forecasted and
the sale of the properties would generate less cash flows for the
issuer or it would take a longer time to sell the properties, all
these factors could result in a downgrade of the ratings.
Additionally counterparty risk could cause a downgrade of the
ratings due to a weakening of the credit profile of transaction
counterparties. Finally, unforeseen regulatory changes or
significant changes in the legal environment may also result in
changes of the ratings.


BANCO COMERCIAL PORTUGUES: S&P Alters Outlook on ICRs to Positive
-----------------------------------------------------------------
S&P Global Ratings revised to positive from stable its outlook on
Banco Comercial Portugues S.A. (BCP) and affirmed its 'BB/B' long-
and short-term issuer credit ratings on the bank.

S&P said, "At the same time, we affirmed our 'BBB-/A-3' long- and
short-term resolution counterparty ratings on BCP, as well as all
the issue ratings.

"The rating action reflects our belief that BCP is gradually
improving its domestic profitability while advancing in the
clean-up of its balance sheet and preserving its enhanced
capitalization. Despite the economic softening in Europe and the
"lower for longer" interest rates environment, we anticipate that
BCP's returns in Portugal will grow on the back of declining credit
losses. At the same time, we expect BCP to continue defending its
solid franchise in the concentrated Portuguese banking system,
where it holds market shares of about 17.5% in loans and
deposits."

Since 2017, BCP has managed to make its domestic operations
profitable again. The bank reported domestic net income of EUR73
million in the first half of 2019, compared with more than EUR800
million losses in 2013. The improvement has been driven by a lower
cost of risk (although it is still higher than normalized costs),
as well as by BCP's revenue diversification, which is better than
that of its peers (fee income accounted for 30% of operating
revenues in first-half 2019, compared with an average of 26% for
BCP's peers at end-2018).

Furthermore, BCP remains more efficient than its domestic and
international peers, having undergone significant restructuring
ahead of some peers since 2011. At end-June 2019, its
cost-to-income ratio stood at 47% compared with an average of 58%
for its peer group at end-2018. S&P said, "We anticipate BCP's
metrics will deteriorate slightly to about 49% this year and next,
due to higher operating expenses and somewhat pressured operating
revenues; that said, these figures compare favorably with those of
its peers, for which we anticipate an average 60% cost-to-income
ratio." In addition, and contrary to its closest domestic peers
that are focused on Portugal, BCP benefits from the diversification
added by its international operations. Such operations, and
particularly Poland, have supported the group's profitability in
recent years.

S&P said, "In addition, we expect BCP's capitalization will
continue growing, with its RAC ratio standing at about 6.25%-6.75%
by end-2020, from 5.5% at end-2018. The improvement will be driven
by further earnings retention and by the issuance of EUR400 million
additional Tier 1 (AT1) notes in January 2019, but at the same time
the relatively high economic risk that we envisage in Portugal
weighs on our capital measure. We also note that BCP's quality of
capital remains constrained by the large proportion of deferred tax
assets in its total adjusted capital, which are high in both
absolute and relative terms.

"Our expectations for BCP's capital do not include the potential
impact of possible losses from BCP's foreign currency-denominated
mortgages in Poland. Bank Millennium S.A., BCP's Poland subsidiary,
had EUR3.3 billion of such loans at end-June 2019, equivalent to 6%
of BCP's consolidated gross loans. On Oct. 3, 2019, the European
Court of Justice expressed its judgement on a specific Swiss
franc-indexed mortgage case, ruling in favor of the borrowers. We
believe such ruling could lead to further litigation by debtors,
and higher extraordinary costs and reputational risk for banks,
including Bank Millennium. That said, we estimate that, even
assuming some stressed losses on its foreign currency mortgages
portfolio, BCP's risk-adjusted capital (RAC) ratio would still
remain comfortably above the 5% threshold for a moderate capital
and earnings position, as a 50% loss of the total nominal amount of
this portfolio would account for about 100 basis points of BCP's
RAC.

"At the same time, we anticipate that BCP will continue to focus on
reducing its stock of nonperforming exposures (NPEs), to reach an
NPE ratio of about 6% by end-2020. While declining, BCP's NPE stock
remains high in absolute and relative terms compared to both
domestic and international peers. At end-2018, its net problematic
assets equaled 64% of total adjusted capital, compared to 50%
average for its peer group. In addition, BCP's single-name
concentration is high, in our view, and its capital base is
sensitive to actuarial changes arising from its pension obligations
toward its employees.

"Our ratings on BCP continue to reflect its rebalanced funding and
liquidity profile in recent years. At end-June 2019, retail
deposits accounted for 85% of its funding base, and its liquid
assets covered 7.7x short-term wholesale funding, or 4.1x if we
consider the second series of targeted longer-term refinancing
operations funding as short-term. In addition, BCP has gradually
regained access to debt capital markets--although at a higher cost
than other Southern European banks--including the EUR400 million
AT1 issued earlier in 2019, and EUR450 million subordinated notes
issued in September 2019.

"The positive outlook on BCP indicates that we could raise our
long-term rating over the next 12-18 months if the bank further
strengthens the performance of its domestic profitability without
increasing its risk appetite, while maintaining its efficiency and
revenue diversification advantages, and proving able to defend its
solid franchise in the concentrated Portuguese banking system.

"The positive outlook also assumes that BCP will remain focused on
cleaning up its balance sheet, with its NPE ratio falling to about
6% by end-2020, although the NPE stock is likely to remain high
compared to both domestic and international peers. In addition, we
anticipate that its capitalization will grow in coming quarters,
with a RAC ratio of about 6.25%-6.75% by end-2020.

"Conversely, we could revise the outlook back to stable if BCP
proves unable to improve its domestic profitability, if litigation
risks in Poland turned out to be worse than we expect and the
related losses end up significantly hitting BCP's consolidated
capital position, or if the bank engages in overly aggressive
growth, impairing its financial profile."


HAITONG BANK: S&P Raises ICR to 'BB' on Improving Capitalization
----------------------------------------------------------------
S&P Global Ratings said that it raised its long-term issuer credit
rating on Portugal-based Haitong Bank S.A. to 'BB' from 'BB-'. At
the same time, S&P affirmed its short-term rating on Haitong Bank
at 'B'. The outlook is stable.

The upgrade reflects S&P's view that Haitong Bank has continued to
strengthen its solvency and is making progress in de-risking its
balance sheet.

Following Haitong Bank's gradual reduction of its highly
risk-weighted balance sheet, and the issuance of an additional tier
1 instrument of EUR105.4 million in March 2018 (fully subscribed by
its Chinese parent), we consider that the bank has strengthened its
capital compared with the risks it bears. Haitong Bank's
risk-adjusted capital (RAC) ratio stood at 13.24% on Dec. 31,
2018--or 13.56% pro forma the upgrade of Portugal and our
assessment of improved economic risks in Poland--compared with
8.07% a year before. We anticipate that our RAC ratio will stand
sustainably between 11% and 12% by end-2020, owing primarily to:

-- Improving, albeit modest, earnings generation in 2019 and 2020,
on the back of a still-inefficient structure (cost-to-income ratio
of about 70%-75%) and higher impairment charges (1.6%-1.3% of total
average loans) than peers.

-- No dividend payout and no further additional capital injections
from the parent, in line with management's guidance.

-- A rise in S&P risk-weighted assets of around 20% cumulatively
by end-2020, as management's strategy to gradually build up its
bridge financing pipeline materializes. We also account for an
increase in market and credit valuation adjustment risk, as trading
operations gradually pick up.

In recent quarters, Haitong Bank has made progress in reducing its
large stock of problematic loans, driven by a mixture of
write-offs, recoveries, and some market sales. The stock halved
between end-December 2017 and end-June 2019, bringing total
nonperforming loans (NPLs) to about 24.1% of gross loans at
end-June 2019, compared with 37.3% at end-2017.

Additionally, in March 2019, the bank announced the sale of its
Irish subsidiary, Haitong Investment Ireland PLC (HIIP) to its
parent. S&P views this carve-out as a way of the parent providing
additional support, since the bulk of the outstanding NPLs are held
at HIIP. On completion of the carve-out-–which we expect will
take place by end-2019--Haitong Bank's NPLs should fall below 5.5%
of gross loans, comparing favorably with our expectation for the
Portuguese banking system of 10.9% as of the same date.

S&P said, "That said, we think that Haitong Bank's risk profile is
undermined by higher single-name concentration and more significant
exposure to speculative-grade corporate entities than its domestic
peers. We estimate that the top 20 exposures represented about
one-quarter of Haitong Bank's total assets at end-June 2019.
Additionally, the bank's increasing exposure to Chinese companies
(about 19% of its total exposure) could pose risks in the future,
as the indebtedness of the Chinese corporate sector is already
high.

"We maintain our assessment of Haitong Bank's business position as
weak. Specifically, we consider that the bank's revision of its
strategy in 2017 to focus on originating and distributing bonds for
Chinese issuers outside their home market, and providing bridge
financing to Chinese companies expanding abroad is more realistic
than the previous strategy. We also view the significant
restructuring and 44% staff reduction since end-2016 as positive
for the bank's business turnaround."

As a result, 2018 was the first year since Haitong Bank's
acquisition by China-based Haitong Securities Co. Ltd. that it
posted positive pre-provision income of EUR21 million, compared
with a EUR50 million loss a year before. However, S&P expects that
the bank will only improve its operating revenues and efficiency
very gradually, with the cost-to-income ratio and bottom-line
profitability continuing to lag those of peers. In particular, S&P
forecasts a cost-to-income ratio of about 70%-75% by end-2020 for
Haitong Bank, compared with 56% for its peer group, and a return on
equity hovering around 2.5%, compared with our average expectation
for its peers of 9.0% as of the same date.

Haitong Bank remains strategically important to its parent. S&P's
rating analysis therefore incorporates the likelihood of Haitong
Bank receiving extraordinary parental support, and the ratings on
Haitong Bank receive three notches of uplift above the stand-alone
credit profile. Additionally, S&P's assessment of Haitong Bank's
stand-alone creditworthiness also benefits from the financial
support in the form of funding guarantees and capital that the
parent has already provided. The bank has benefited from capital
support of around EUR950 million since the acquisition in 2015.
Funding support is in the form of parent guarantees of EUR750
million on a loan provided by a syndicate of Chinese banks. This
parental reliance is critical because other funding sources could
be less readily available or might be unaffordable.

S&P said, "We rate the outstanding senior unsecured notes under
HIIP's European medium-term note (EMTN) program and equalize the
rating on the notes with that on Haitong Bank. The equalization
reflects the Keep Well Agreement (KWA) between HIIP and Haitong
Bank, since the agreement qualifies for ratings substitution under
our guarantee criteria. The sale of HIIP and subsequent
deconsolidation from Haitong Bank's financials does not affect our
rating on the notes, as the existing KWA will remain in place.
However, under the EMTN program, Haitong Bank will receive a
counter-guarantee from its parent for any payments that the bank
has made or may make.

"The stable outlook on Haitong Bank reflects our expectation that
the bank will remain focused on gradually turning around its
business model to achieve more sustainable profitability, and that
it will continue to reduce the tail risks associated with legacy
problematic loans over the next 12-18 months. We expect that NPLs
will represent about 5% by end-2020, and that management will
maintain improved underwriting standards while gradually expanding
the loan book. We also expect that organic capital generation will
be modest, but sufficient to preserve the bank's enhanced capital
position, with our RAC ratio standing at around 11%-12% over the
12-18 month outlook horizon.

"We could raise our ratings on Haitong Bank if it improved its
operating profitability sustainably, generating recurring and
stable revenues, while gradually aligning its efficiency with that
of peers. Although not our base case, we could also raise the
ratings if we considered Haitong Bank to be a more important
subsidiary for its Chinese parent.

"We could lower our ratings if we observed a slowdown in the
turnaround of Haitong Bank's strategy; if the bank were to incur
material losses or undertake aggressive expansion that pushed the
RAC ratio below 10%; or if its asset quality worsened unexpectedly.
We could also lower the ratings if the bank faced a renewed need to
restructure, or if the parent's commitment to the bank faltered."




=========
S P A I N
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CAJAMAR PYME 2: Moody's Raises Rating on EUR240M Cl. B Notes to B2
------------------------------------------------------------------
Moody's Investors Service upgraded the rating of Class B notes in
IM BCC CAJAMAR PYME 2, FONDO DE TITULIZACION. The rating action
reflects the increased level of credit enhancement in these notes.

Moody's has affirmed the rating of Class A notes which have
sufficient credit enhancement to maintain the current rating.

   EUR760 million (current outstanding balance145.4M) Class A
   Notes, Affirmed Aa1 (sf); previously on Dec 4, 2018
   Upgraded to Aa1 (sf)

   EUR240 million Class B Notes, Upgraded to B2 (sf); previously
   on Dec 4, 2018 Upgraded to B3 (sf)

IM BCC CAJAMAR PYME 2, FONDO DE TITULIZACION is a static cash
securitisation of term loans granted by Cajamar Caja Rural, Soc.
Coop. de Credito (NR) to small and medium-sized enterprises and
self-employed individuals located in Spain.

RATINGS RATIONALE

The upgrade is prompted by the increase in the credit enhancement
available for the affected tranche as a result of portfolio
amortization. The CE level for Class B Notes has increased to 7.78%
from 5.97% since the last rating action.

The rating of the Class A notes has been affirmed at Aa1 (sf) as
the ratings is capped at the Spanish local currency country
ceiling.

Revision of key collateral assumptions

As part of the rating action, Moody's reassessed the key collateral
assumptions based on loan by loan updated information. The
performance of this deal is in line with the expectations and so
Moody's has kept unchanged its default probability and recovery
rate assumptions for the portfolio at 15% and 35% respectively.

Exposure to counterparties

The rating action took into consideration the notes' exposure to
relevant counterparties, such as servicer and account bank.

Moody's considered how the liquidity available in the transaction
and other structural mitigants support continuity of notes payments
in case of servicer default, using the CR assessment as a reference
point for the servicer. None of the ratings of the outstanding
classes are constrained by operational risk.

Moody's also assessed the default probability of the account bank
provider by referencing the bank's deposit rating.

The principal methodology used in these ratings was "Moody's Global
Approach to Rating SME Balance Sheet Securitizations" published in
July 2019.

Factors that would lead to an upgrade or downgrade of the ratings:

Factors or circumstances that could lead to an upgrade of the
ratings include: (1) performance of the underlying collateral that
is better than Moody's expected; (2) deleveraging of the capital
structure; (3) improvements in the credit quality of the
transaction counterparties; and (4) reduction in sovereign risk.

Factors or circumstances that could lead to a downgrade of the
ratings include: (1) performance of the underlying collateral that
is worse than Moody's expected; (2) deterioration in the notes'
available credit enhancement; (3) deterioration in the credit
quality of the transaction counterparties; and (4) an increase in
sovereign risk.


CELLNEX TELECOM: S&P Affirms BB+ ICR on Sizable Equity Injection
----------------------------------------------------------------
S&P Global Ratings affirmed its 'BB+' long-term rating on Spanish
wireless telecom and broadcasting infrastructure operator Cellnex
Telecom S.A.

The rating action follows the company's announcement of a sizable
EUR2.5 billion equity injection, the second capital increase this
year after the EUR1.2 billion injection executed in March. S&P
said, "Thanks to the fresh cash proceeds, we expect the company's
leverage will substantially drop in 2019, toward 4.0x, from 5.9x in
2018 (5.5x pro forma for past acquisitions not yet fully
contributing to the fiscal year 2018). This compares with our
previous expectation of a temporary spike above 6.0x in 2019 pro
forma for the EUR2.7 billion transactions in France, Italy, and
Switzerland announced earlier this year. After 2019, and pro forma
for the announced £2 billion acquisition in the U.K., with
completion subject to regulatory approvals, we foresee that
adjusted leverage will rebound toward 5.0x over 2020-2021. We do
not believe that leverage will be maintained at this lower level,
however, given Cellnex's aggressive external growth strategy, and
we anticipate leverage will ultimately increase again, but remain
within 5.0x-6.0x."

S&P said, "The affirmation also factors our view that the
cumulative impact of the transactions with Iliad, Salt--and now
Arqiva--will meaningfully strengthen Cellnex's business risk
profile, assuming successful execution and a smooth integration of
the assets.

"After the deal is completed in the U.K., we estimate that the
number of Cellnex sites will have about doubled to about 45,000 in
2020 from more than 20,000 at year-end 2017, excluding the projects
under construction. In addition, this will significantly dilute the
lower-margin, weaker-growth TV and Radio Broadcasting business to
about 15% from about 25% of revenue, strengthen margins, and
broaden and improve Cellnex's geographic mix and customer
diversity.

"We continue to view the increasing focus on telecom services as
positive because of long-term and protective contracts, strong
local market shares, and high barriers to entry, as well as
steadily increasing demand from telecom operators to expand 4G
coverage and timely address 5G deployments by increasing the
density of capillary cellular networks (local networks that use
short-range radio-access technologies to provide local connectivity
to things and devices). Recent 5G frequency auctions across Europe
have also come with added coverage obligations for operators, which
further enhances the high revenue visibility of tower companies."

These positive factors are temporarily somewhat tempered by
execution risks related to the significant influx of new assets and
delivery of a large number of planned build-to-suit projects agreed
with existing clients. Cellnex posts lower EBITDA margins than
those of several American pure players, and the company's has an
aggressive mergers and acquisition (M&A) strategy, reflecting its
aim to drive industry consolidation across Europe. Nevertheless,
Cellnex has a strong operating track record and a supportive
financial policy so far, as illustrated by the two capital
increases in 2019.

S&P said, "The outlook is stable because we anticipate that Cellnex
will benefit from its increasing scale and diversity, smoothly
integrate recently acquired businesses or transferred sites, and
maintain its adjusted debt to EBITDA at less than 6x, which is
commensurate with the current rating. We also foresee sustainable
ratios of funds from operations (FFO) to debt at higher than 12%
and discretionary cash flow (DCF) to debt at more than 7%."


OBRASCON HUARTE: Fitch Lowers LT IDR to CCC+, Outlook Stable
------------------------------------------------------------
Fitch Ratings downgraded Spanish engineering and construction group
Obrascon Huarte Lain SA's Long-Term Issuer Default Rating to 'CCC+'
from 'B+'. The Outlook is Stable.

The downgrade reflects OHL's weakening financial profile due to
larger than previously expected cash consumption from continuing
legacy project issues. Fitch expects the free cash flow margin to
be negative for the next three years, which is no longer
commensurate with a 'b' rating median in its E&C Navigator. OHL's
weak FCF generation is mainly a function of legacy projects
suffering from contract risk management issues, which translated
into many loss-making projects across different regions and project
types.

The Stable Outlook reflects the expected gradual improvement in
operating profitability and cash conversion, which has been
achieved in the short term through management's increased focus and
control over contract management. Fitch expects cash consumption to
decrease and EBITDA margins to increase to 4% in the medium term as
legacy projects phase out, supported by increasing profitability of
the regular business.

However, there is currently a decreasing margin of safety for
potential higher-than-expected cash burn in the regular business
and Fitch expects the company's liquidity to be increasingly
dependent on cash held in JVs, successful collection of
receivables, potential disposals and other funding sources, which
are subject to execution risk. Fitch believes this will be
partially mitigated bya gradually improving gross margin in the
regular business, new initiatives to strengthen contract risk
management, solid market position in the transport sector and
healthy diversification.

KEY RATING DRIVERS

Outlier Leverage: Fitch expects very high adjusted funds from
operations gross leverage in the medium term, far above its 'b'
category median for E&C companies of 4.5x. The projected high
leverage metrics are primarily driven by the persistent weak cash
generation. Potential alternative funding sources such as disposals
of Old War Office and Canalejas development projects could provide
an additional cash buffer in the medium term, improving OHL's
financial structure. However, Fitch does not incorporate these
disposals in its forecasts.

Deteriorating Liquidity: Fitch expects OHL's liquidity profile to
weaken through substantial cash burn in the medium term and the
company will consequently be increasingly reliant on funding
sources that are subject to execution risk. Its available cash
calculation does not take into account cash located in JVs and
Fitch also restricts cash required for operational needs. Absent
any committed credit lines, Fitch believes OHL's liquidity is
therefore mainly supported by around EUR397 million of
Fitch-adjusted readily available cash.

Weak Profitability: Fitch believes that OHL's volatility of profits
and expected level of FCF consumption over the medium term is a key
weakness for the company. Fitch projects cumulative negative FCF of
around EUR680 million from 2019-2021, including approximately
EUR330 million driven by legacy projects.

In 2018, OHL posted weaker-than-expected negative FCF of around
EUR680 million, mainly driven by substantial cash consumption in
the regular business coupled with legacy projects overhangs and the
cancellation of the reverse factoring line. Fitch believes OHL's
profitability will continue to suffer from weak market conditions
and loss-making legacy projects awarded before 2016, which are now
only expected to be completed by the end of 2021.

Working Capital Consumption: Fitch anticipates high working capital
outflows in the medium term, largely driven by legacy project
overhangs. As a result, Fitch expects that improving margins
arising from new orders will be more than offset by ongoing
substantial working capital requirements. As the legacy projects
subside, Fitch expects OHL could return to broadly neutral FCF
generation in 2022.

Contract Risk Management Issues: Fitch believes that OHL's
recurring losses from legacy projects were largely driven by
persistent contract risk management issues in the previous years.
Fitch notes that there are many different loss-making legacy
projects across various countries and project types that point to
process issues rather than project-specific problems. OHL's
management has introduced new initiatives to strengthen risk
management procedures, including the introduction of clear
profitability targets, a focus on key regions, better oversight of
regional hubs and more effective cost control at the project level.
Fitch expects improvements in contract risk management, which will
be reflected in improving EBITDA margins and a gradual decrease in
working capital consumption.

Strengths in Business Profile: The company's business profile is
underpinned by strong market positions, and a relatively stable
order book and sound diversification. OHL ranks as a top 50
international E&C contractor and it boasts a solid market position
in roads and railways. The company has a globally diversified
geographic footprint with around two-thirds of revenues generated
outside Spain, mainly in the US and Latin America countries. OHL
has a moderate customer concentration with top 10 customers
accounting for around half of the backlog.

DERIVATION SUMMARY

Following the sales of its concession business, OHL is now a pure
engineering and construction company, similar to Grupo Aldesa
(B-/Stable), which has a minor concession portfolio. Fitch deems
OHL's business profile as somewhat weaker compared with Grupo
Aldesa. OHL's larger scale, broader geographic diversification and
stronger market position in roads and railways segment is more than
offset by elevated working capital requirement and history of
persistent issues with the contract risk management indicated by
many legacy projects across different markets and business segment.
OHL's financial profile is also weaker than Grupo Aldesa given
Aldesa's lower debt and longer-dated maturity profile limiting
short-term refinancing risk, compared with OHL's ongoing sizeable
cash consumption and related deteriorating financial flexibility.

KEY ASSUMPTIONS

  - Revenues of around EUR2.7 billion-EUR2.8 billionn in
    2019-2020 and EUR3.1 billion-EUR3.2 billion in 2021-2022

  - EBITDA margin of around 1.7% in 2019, 3.0% in 2020 gradually
    increasing to 4.0% by 2022

  - Capex intensity of around 2.4% in 2019 and 1.6-1.8% in
    2020-2022

  - Working capital cash consumption from regular business of
    around 6% in 2019 and 1%-2% in 2020-2022

  - Cash consumption from legacy projects of around 6% of revenues
    in 2019, 4% in 2020 and 2% in 2021

  - Mayakoba divestment in 2019 for EUR92 million

  - No acquisitions or other divestments

  - No dividends

RATING SENSITIVITIES

Developments That May, Individually or Collectively, Lead to
Positive Rating Action

  - Positive cash flows in the regular construction business

  - Lower-than-expected cash consumption from legacy projects

  - Improvement in liquidity position

  - FFO adjusted gross leverage below 5.0x and FFO fixed charge
    cover above 1.5x on a sustained basis

Developments That May, Individually or Collectively, Lead to
Negative Rating Action

  - Sustainably negative cash flows in the regular
    construction business

  - Higher-than-expected cash consumption from legacy projects

  - FFO fixed charge cover below 1.0x on a sustained basis

  - Weakening liquidity position

LIQUIDITY AND DEBT STRUCTURE

Deteriorating Liquidity: Liquidity is supported by around EUR397
million of Fitch-adjusted readily available cash, which excludes
EUR267 million of cash in JVs and incorporates an EUR150 million
cash restriction related to intra-year working capital swings. The
short-term debt maturities include approximately EUR73 million of
bonds due in March 2020 and EUR82 million factoring. However, Fitch
expects negative FCF (after disposals) of around EUR300 million in
2019 and EUR175 million in 2020. As a result, Fitch expects that
liquidity will be increasingly dependent on the cash held in JVs,
potential new debt drawdowns, successful collection of receivables,
potential disposals and other potential funding sources that are
subject to execution risk.

Its rating case excludes some potential cash buffers including
potential divestments of OHL's stakes in the Canalejas and Old War
Office development projects with total net book value of around
EUR301 million as at the end of 2018.

Debt Structure: As of the end of 2018, OHL's debt mainly comprised
three senior unsecured bonds with total principal value of around
EUR666 million. OHL had also around EUR22 million other recourse
debt and EUR55 million non-recourse project level debt. In
addition, the company used a factoring line with total outstanding
amount of approximately EUR82 million. OHL's main debt maturities
comprise bond maturities of around EUR73 million in 2020, EUR323
million in 2022 and EUR270 million in 2023.

SUMMARY OF FINANCIAL ADJUSTMENTS

  - Lease equivalent debt was calculated at around EUR66 million
using an average multiple of 8x

  - Cash of EUR417 million was treated as restricted cash including
EUR267 million cash held in JVs and EUR150 million for operational
purposes




===========
S W E D E N
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IGT HOLDING IV: S&P Assigns 'B-' Long-Term ICR, Outlook Stable
--------------------------------------------------------------
S&P Global Ratings, on Oct. 10, 2019, assigned its 'B-' long-term
issuer credit rating to IGT Holding IV AB -- owner of Software
Provider IFS AB -- and its 'B-' issue-level rating and '4' recovery
rating to the company's senior secured term loan.

Sweden-based provider of enterprise application software (EAS) IFS
AB holds a leading position in niche verticals like Enterprise
Asset Management (EAM) for aerospace and defense, and provides
mission-critical software to a stable customer base; but is exposed
to competition from much larger enterprise software providers. IFS
is increasing its euro-denominated term loan B by about EUR180
million, equivalent to Swedish Krona (SEK) 1.93 billion, to finance
a dividend recapitalization transaction of SEK-equivalent 1.75
billion in fourth-quarter 2019.

The ratings reflect IFS' high leverage (S&P Global
Ratings-adjusted), strong competition from much larger and better
capitalized peers, and low-but-growing profitability compared with
industry peers. Partially offsetting these are IFS' leading
positions in niche verticals, the products' mission-critical
nature, a stable customer base with high retention rates, and solid
growth prospects.

The company is increasing its euro-denominated term loan B by
EUR180 million to fund a dividend of SEK-equivalent 1.75 billion,
repay SEK-equivalent 132 million drawn under its revolving credit
facility (RCF), and pay related fees and expenses. Concurrently,
S&P expects the margins on its existing euro- and
U.S.-dollar-denominated term loan B facility tranches will slightly
increase from the existing E+325 bps, and E+350 bps, respectively.
S&P expects debt (S&P Global Ratings-adjusted) will increase to
above SEK 10.8 billion in 2019 from about SEK 8.8 billion at the
end of 2018, resulting in adjusted debt-to-EBITDA above 10x in 2019
and 2020. However, S&P expects EBITDA cash interest coverage will
exceed 2x in that time.

S&P said, "Balancing this is our view that IFS benefits from strong
momentum across its businesses, thanks to new management's
multifaceted strategy focusing on revenue growth and profitability
improvement. To boost revenues, management increased deal sizes (by
37% on average in the first half of 2019), focused on value, won a
number of deals resulting in increased revenues per deal, repriced
maintenance and support services, focused on upselling and
cross-selling products, and on cloud and SaaS products. As a
result, IFS has beaten competition in its addressable markets and
increased its customer base (50% of license revenues in first-half
2019 came from new customers).

"Profitability improvement will come, in our view, from the cloud
business' larger scale, moving support functions offshore,
increasing off-shoring for professional services, centralizing
research and development (R&D) centers in two locations (Sweden and
Sri Lanka) from seven, leveraging self-service technology in
support services, and upwardly revising the global pricing model.

"Overall, we think these initiatives should result in an S&P Global
Ratings-adjusted annual revenue growth above 15%, coupled with
gradual expansion in the S&P Global Ratings-adjusted EBITDA margin
to 15% in 2020 from 10% in 2018. Stronger revenue and EBITDA
trajectory supports our business risk assessment of fair.

"Our business risk assessment also reflects the company's leading
position in niche verticals, including EAM for aerospace and
utilities. In addition, we view the critical nature of IFS's
software and its stable customer base (renewal rate is 97%) as
mitigating the relatively low portion of its recurrent revenues
(45% in the first six months of 2019, although this has risen
gradually from 37% in 2017 due to strong growth in cloud revenues
and a move towards subscription-based license revenues). The
modular nature remains the key differentiation for IFS products.
Specialized offerings like maintenance, repair, and operations
(MRO) have limited competition in the market and target specific
needs of the customer. Flexibility in deployment (on premise or
cloud) at customer demand, where most peers are pushing for cloud
deployment, also adds to the modular nature of the product. Having
said that, cloud and SaaS revenues grew by 17% year-over-year
(Y-o-Y) in first half of 2019, indicating a strong adoption rate
for cloud-based deployment in IFS' client base.

"Nevertheless, our business risk assessment is constrained by
strong competition with considerably larger and better-capitalized
enterprise software providers, such as SAP and Oracle. They enjoy a
firmly established position in the wider enterprise application
market, with higher market shares, strong brand perception, a
broader product profile and greater geographic diversity of
operations. IFS still has less-recurrent revenue than peers, due to
a high share of consulting revenues stemming from a focus on
customized solutions. Furthermore, we still consider the company's
EBITDA margin (S&P Global Ratings-adjusted) below industry average
and that of other software companies with similar business risk
assessments like Unit 4, with an adjusted EBITDA margin of 20.5%
for 2018. This partially results from a high share of revenues
stemming from its low-margin consulting segment (36% in the first
six months of 2019).

"We factor in our assessment of IFS' financial risk profile the
highly leveraged capital structure as reflected by the company's
high debt (S&P Global Ratings-adjusted) of SEK10.2 billion,
including the proposed issuance, primarily consisting of EUR610
million and $264 million term loans. S&P Global Ratings-adjusted
debt includes SEK1.38 billion (as of June 2019) PIK notes at its
holding company IGT Holding I AB. In addition, EBITDA interest
coverage will remain below 2.5x in 2019 and 2020. Partially
mitigating this is our expectation of positive FOCF, with S&P
Global Ratings-adjusted FOCF-to-debt of 2%-5% in that time. To
calculate our adjusted credit metrics, we deduct capitalized
development costs (expected at about SEK500 million in 2019) from
reported EBITDA, cash flow from operations, and capital
expenditures.

"The stable outlook reflects our expectation of revenue growth
above 15% combined with an S&P Global Ratings-adjusted EBITDA
margin to close to 15% by 2020. We expect adjusted leverage to
remain above 10x in 2019 and 2020 (above 8x excluding the PIK
notes) but positive FOCF of more than SEK 100 million in 2019,
likely exceeding more than SEK 300 million by 2020. The outlook
also reflects our expectation that IFS will maintain adequate
liquidity.

"We could lower the rating if IFS' FOCF turned negative for an
extended period, EBITDA cash interest coverage fell below 1.5x, or
liquidity deteriorated materially. This could result from operating
performance weakening through intense competition, higher customer
churn, loss of market share, or difficulties in implementing its
four-year business plans.

"We could raise our rating on IFS if adjusted leverage declined to
below 10x (about 8x without the PIK notes), FOCF-to-debt improved
to above 5%, and EBITDA cash interest coverage ratio strengthened
to above 3x. This could happen with continued strong double-digit
revenue growth combined with strengthening of S&P Global
Ratings-adjusted EBITDA margins to more than 17%, most likely
resulting from a more favorable business mix, and stringent cost
control measures resulting in substantial cost savings."




=====================
S W I T Z E R L A N D
=====================

SIG COMBIBLOC: Moody's Raises CFR to Ba2, Outlook Stable
--------------------------------------------------------
Moody's Investors Service upgraded the corporate family rating of
SIG Combibloc Group AG to Ba2 from Ba3 and the probability of
default rating to Ba2-PD from Ba3-PD. Concurrently, Moody's
upgraded to Ba2 from Ba3 the ratings on the senior secured Term
Loan A and the senior secured revolving bank credit facility,
borrowed at subsidiaries SIG Combibloc PurchaseCo S.a r.l., SIG
Combibloc US Acquisition Inc. and SIG Combibloc US Acquisition II
Inc., and to Ba2 from Ba3 the rating on the senior secured Term
Loan B borrowed at SIG Combibloc PurchaseCo S.a r.l. The outlook
remains stable.

RATINGS RATIONALE

The upgrade reflects Moody's expectation that Moody's-adjusted
debt/EBITDA will sustainably fall below 4.0x in the coming 12 to 18
months and that further gradual deleveraging is supported by
revenue growth, reducing debt given the amortising term loan A and
the company's declared focus to deleverage to towards 2.0x over the
medium term from 3.3x as of June 2019 based on the company's
definition. Moody's also expects steady but limited free cash flow
generation after net capex, dividends and interest payments.

Revenue growth in the six months to June 2019 has remained
resilient with 5.1% core revenue growth at constant currency and
6.9% on a reported basis. Company-adjusted EBITDA grew at 3.9%.
Continued growth will be supported by the company's focus on faster
growing economies in APAC or the Americas with Europe for example
accounting for well below 50% of revenues. In addition, its
business model focusing on supplying filling machines and carton
sleeves under multi-year contracts with a focus on certain basic
beverage and food end markets such as liquid dairy provides further
resilience even in weaker macroeconomic environments.

These positive considerations remain balanced by (i) the
concentration of revenue within one activity, aseptic carton
packaging systems, and its susceptibility to any substitution away
from this form of packaging, (ii) the risks from potential price
volatility in certain raw materials such as resins or aluminium,
which is not automatically passed through to customers, (iii) a
degree of customer concentration, and (iv) a more challenging
growth environment in its core and more mature European market.
Moody's also notes that the company's cash flow generative nature
is balanced by significant capex requirements and substantial
ongoing dividend payments.

Moody's considers the liquidity profile as good. As of June 2019,
SIG had EUR79 million of cash on the balance sheet and access to a
fully undrawn and committed EUR300 million multi-currency revolving
credit facility (RCF) due 2023. There is a first lien net leverage
covenant, tested semi-annually, under which Moody's expects the
company to retain good headroom. Moody's also expects the
amortization payments for the EUR1.25 billion term loan A to be
covered by free cash flow while the next larger debt maturity will
only be in 2023.

Environmental and social considerations reflected in the rating
include the trend towards more sustainable packaging solutions
amongst customers, regulators and consumers that may influence the
demand for the company's products. Aseptic carton packaging is a
relatively complex product because it typically consists of liquid
paperboard, aluminium and (plastic) resin but it also has solid
recycling rates in mature markets such as Europe compared to many
plastic packaging products, for example. Governance considerations
include the growing track record of the company as a Swiss-listed
business and related governance requirements following the 2018 IPO
and the increased free float, which now represents the majority of
the company's shares after Onex's share sale in September 2019.

RATING OUTLOOK

The stable outlook reflects Moody's expectation of steady
performance and gradual deleveraging on the back of revenue growth
and debt amortization payments.

FACTORS THAT COULD CHANGE THE RATING UP/DOWN

Further progress and track record towards achieving its financial
policy medium term target of towards 2.0x (company-defined net
leverage) through deleveraging and EBITDA growth, thereby also
leading to a reduction in Moody's-adjusted debt/EBITDA sustainably
below 3.5x, would create positive pressure. Moody's would also
expect the company to continue to generate sustainable mid-single
digit positive free cash flow to debt (after interest, capex and
dividends) for positive pressure. Conversely, Moody's-adjusted
debt/EBITDA rising sustainably above 4.3x, a weakening of the
company's free cash flow profile or liquidity would create negative
pressure. More aggressive financial policies, evidenced for example
by debt-funded acquisitions, rising Moody's-adjusted debt or more
shareholder-friendly actions, could also pressure the rating.

PRINCIPAL METHODOLOGY

The principal methodology used in these ratings was Packaging
Manufacturers: Metal, Glass, and Plastic Containers published in
May 2018.

Headquartered in Switzerland, SIG is the second largest
manufacturer of aseptic carton packaging systems, supplying mostly
the liquid dairy (e.g. milk, cream and soy milk products) and
non-carbonated soft drinks (e.g. juice, nectar and ice tea) end
markets. The company's aseptic cartons can also be used for liquid
food products, such as soups and broths, sauces, desserts and baby
food. Aseptic carton packaging, most prevalent in Europe and Asia,
is designed to allow beverages or liquid food to be stored for
extended periods of time without refrigeration. SIG supplies
complete aseptic carton packaging systems, which include aseptic
filling machines, aseptic cartons, spouts, caps and closures and
support services. The company is listed on the Swiss Stock Exchange
since September 2018 and reported revenue of EUR1.7 billion in
2018.


WALNUT BIDCO: S&P Assigns B+ Issuer Credit Rating, Outlook Stable
-----------------------------------------------------------------
S&P Global Ratings assigned a 'B+' issuer credit rating to Walnut
Bidco (Oriflame), and a 'B+' issue rating to the EUR775 million
equivalent (EUR475 million and $335 million) senior secured notes
due 2024.

The final ratings are in line with S&P's preliminary 'B+' ratings
assigned on July 22, 2019.

Oriflame is a producer and direct seller of beauty and wellness
products. It generated EUR1.3 billion of sales and EUR199.6 million
of EBITDA in 2018. S&P's rating assignment of 'B+' is supported by
its brand equity in key markets, its global operations, and its
significant FOCF generation; but constrained by its exposure to
evolving regulatory frameworks and its involvement in emerging
markets with fluctuating currencies and external environments that
can lead to metrics volatility.

Oriflame's brand equity is built around its "Beauty by Sweden"
proposition. Its diverse product offering is categorized in six
segments: Skincare (29% of total group sales in 2018), Colour
Cosmetics (19%), Fragrances (18%), Personal & Hair Care (16%),
Wellness (13%), and Accessories (5%). Products benefit from
positive aspects of the Swedish branding, and are targeted at the
mid to higher range of the mass market. The company sustains its
position by bringing about 400 new products to the market each
year. It will now focus on its most profitable segments of Skincare
and Wellness, which often come in daily routine sets, emphasizing
product loyalty, and allowing for more personalized advice and
value-adding from sellers. Other categories help with fixed cost
recovery, and have specific roles: Colour Cosmetics act as an entry
point for new customers, Fragrances are often purchased as gifts,
and Personal & Hair Care and Accessories complete the range.

S&P views Oriflame's narrow focus on the direct-selling channel as
a constraint to our rating. The direct-selling model involves
selling through a network of consultants, who are not employees of
the company but who generate income from selling Oriflame's
products to their families, friends, or wider circle. Oriflame is
one of the 10 biggest direct sellers specializing in sales of
beauty and personal care products worldwide, and the direct-selling
industry represents about $190 billion. The industry grows at about
4% per year according to the World Federation of Direct Selling
Association (WFDSA), and Oriflame benefits from its focus on the
fastest-growing subsegments of the industry with its involvement in
the Beauty and Wellness segments. In addition, Oriflame is
well-placed in its digital transformation, as about 96% of all
orders are made through online applications, including 46% of
orders through mobile applications.

However, S&P believes that competition might intensify, as pure
online players are the fastest-growing channel in the Beauty and
Personal Care segment. In addition, the direct-selling model
involves recruiting new consultants every year and managing them
efficiently in order to limit the churn rate. Oriflame has about
three million consultants, of whom about two-thirds are product
users who benefit from discounts on products or sell Oriflame's
products to third-party end-consumers at a mark-up, and have a high
churn rate. About one million consultants are active sellers of
products and receive commissions and bonuses, and about 1% are
active leaders generating most of group's sales. In that active
network segment, the average tenure is 10 years. Oriflame's
strategy includes attracting and retaining consultants by offering
them training and viable business opportunities. S&P views
consultant retention as an inherent risk in the industry, however.

Oriflame is present in four continents and more than 60 countries,
which provides a good level of geographical diversification. The
largest countries in terms of operating profit are China and
Indonesia. Asia is more profitable than other regions, thanks to a
more favorable product mix skewed toward Skincare and Wellness. S&P
views positively the geographical diversification and believe it
helps Oriflame to withstand volatility coming from the external
environment. The company is now focusing on six key markets: China,
Russia, Indonesia, Vietnam, Turkey, and Mexico.

S&P said, "We also view positively Oriflame's asset-light
manufacturing structure, with low capex and working capital
requirements. The group has six manufacturing facilities located in
some of its key markets, in India, China, Russia, and Poland, and
produces about 60% of its merchandise. Oriflame plans to increase
insourcing, which we believe will contribute to improving operating
margins. Thanks to this lean structure, we anticipate that the
group will generate recurring strong operating cash flow of above
EUR70 million each year.

"We consider Oriflame's new capital structure to be leveraged, with
adjusted debt to EBITDA about 4x in 2019 and 2020, and funds from
operations (FFO) to debt at about 15%. We net about 75% of the cash
in our debt calculation, as we understand the group can access this
portion of cash thanks to efficient cash pooling practices in
Switzerland. Historically, we understand the company has never had
issues accessing cash to service dividends, interests, and supplier
payments."

The company generates revenues in about 40 different currencies. As
a result of appropriate revenue-cost currency matching, it is able
to cover about 55% of revenues with natural hedging and
cross-currency hedges. S&P said, "We understand interest payments
will be made in euros. We believe the euro-specific interest
coverage will be above 1.2x in the coming two years and therefore
we think the currency risk of the debt is neutral."

The rating incorporates a one-notch negative adjustment reflecting
the specific situation of Oriflame, involved in an industry with
evolving regulatory environments, and subject to volatility of
credit metrics. Direct-selling is often a regulated activity to
prevent fraudulent schemes and false claims on products. Although
Oriflame is used to navigating evolving regulatory frameworks, it
is not immune to the imposition of stricter local regulations. For
example, the Chinese government established a 100-day moratorium on
direct-selling meetings in January 2019 to investigate and shut
down illegal schemes. This had a strong negative impact on
first-quarter 2019 results for Oriflame, with a 17% decline in
sales in Asia. S&P understands that the ban is now over and that
Oriflame passed all controls. However, there are still ongoing
reviews of direct-selling legislation in China, Indonesia, and
Vietnam. Although the company expects no major disruptions, S&P
believes this is a risk that companies outside that industry do not
face.

In addition, due to the company's currency exposure, credit metrics
have been historically volatile when translated to euros (topline
decline of 10% in 2014 compared with 1% growth in local currency
for example), and we believe Oriflame may continue to face
important swings in topline revenues and, to a lesser extent, in
profit margins.

S&P said, "The stable outlook reflects our expectation that
Oriflame will continue to post adjusted EBITDA margins of
15.0%-15.5% in the next 12 months, and will maintain adjusted debt
to EBITDA between 3.5x and 4.5x, and EBITDA interest coverage above
2.5x. We believe that the company may experience a marginal sales
decline in 2019 owing to a tough external environment-- especially
in Asia, following changes in regulations--but that it will
progressively evolve its product offering to a more favorable price
mix, contributing to an increase in profitability. We also believe
the group will continue to generate significant FOCF of above EUR70
million in the next 12 months.

"We could lower our ratings if Oriflame experienced significant
challenges affecting its operational performance; for example, a
failure to stabilize its key segments of Skincare and Wellness,
increased competition, or if there were unfavorable regulatory
changes implemented simultaneously in countries where Oriflame is
most exposed. This could translate into a contraction in the number
of consultants, which could lead to reduced volumes sold and
adjusted EBITDA margins contracting by more than 200 basis points.
We would lower our ratings if adjusted debt to EBITDA metrics rose
above 5x, and EBITDA interest coverage dropped below 2x.

"We could raise our ratings if Oriflame experienced a sustainable
increase in its profitability and if we saw substantial growth
trends in its key segments, as well as no big volatile movement in
credit metrics. We would also take a more positive view if
Oriflame's key countries of operation made strong commitments to a
stable regulatory environment for direct-selling activities. We
could also revise upward our assessment if FFO to debt was
sustainably above 20% and EBITDA interest coverage above 6x."




===========================
U N I T E D   K I N G D O M
===========================

BLERIOT MIDCO: Moody's Assigns B3 CFR, Outlook Stable
-----------------------------------------------------
Moody's Investors Service assigned a B3 corporate family rating and
B3-PD probability of default rating to Bleriot Midco Limited, a
holding company formed to effect the acquisition of the Ontic Group
by funds managed by CVC Capital Partners. Ontic is a provider of
original equipment manufacturer- licensed parts and services to the
aerospace and defense industry, and is headquartered in the UK.

Concurrently Moody's has assigned B2 ratings to the $475 million
senior secured first lien term loan due 2026, the $85 million
senior secured first lien revolving credit facility due 2024, and
the $75 million senior secured first lien delayed draw term loan
due 2026, and has assigned a Caa2 rating to the $175 million senior
secured second lien term loan due 2027, all issued by Bleriot US
Bidco Inc., a wholly-owned subsidiary of Bleriot Midco Limited. The
outlook on both entities is stable.

The proceeds of the debt financing, alongside new equity, will be
used to finance of the acquisition of Ontic from BBA Aviation plc
(Ba2, stable), to fund future license acquisitions, for working
capital and to pay transaction fees and expenses. The transaction
is expected to close in the fourth quarter of 2019.

The rating action reflects:

  -- High opening Moody's-adjusted leverage of 7.5x with modest
deleveraging expected

  -- Ontic's resilient portfolio of existing licenses supported by
perpetual or long-term contracts, aftermarket focus and stable
demand

  -- The company's leading position on niche OEM-licensed parts for
legacy aircraft platforms with high margins

RATINGS RATIONALE

The B3 CFR reflects the company's: (1) market leading position in
OEM-licensed parts for legacy Aerospace & Defense platform
products; (2) limited exposure to the economic cycle driven by the
large military end market and aftermarket exposures, with high
platform and product diversification; (3) favourable demand
dynamics supported by increases in the commercial and defense
aircraft fleet and growing OEM propensity to license; (4) high
margins reflecting strong bargaining power in legacy platform
components, sole source positions, limited competition and low
product substitution risk; (5) relatively stable earnings stream
from the existing product base; and (6) long relationship with OEMs
underpinned by product expertise.

The rating also reflects: (1) high Moody's-adjusted leverage of
7.5x with limited de-leveraging expectations, and low cash
generation after new license spending; (2) the potential for demand
reductions from cuts in defense spending or a commercial aerospace
downturn; (3) the potential for increasing competition as the
market matures; (4) risks of increasing pricing control exercised
by OEMs which may limit opportunities for price growth; (5) the
company's relatively small scale and degree of geographic
concentration; and (6) the company's reliance on relationships with
OEMs, which could be adversely affected by loss of key personnel or
weak execution of new license transitions.

Ontic operates in an attractive niche segment providing mainly
aftermarket components (77% of 2018 revenue) to mature and legacy
aircraft platforms. It benefits from product exclusivity under
perpetual or long-term licenses, with 100% renewal rates according
to the company. The company has relatively high bargaining power
which is disproportionate to its scale driven by its exclusive
positions on low volume legacy products serving mainly second tier
commercial airlines or defense customers requiring high levels of
fleet readiness. There is an increasing propensity of OEMs to
license out products because of the resources required to maintain
low volume legacy components and to free up production capacity.
Ontic provides a dedicated focus improving management of
production, supply chains and part availability.

Ontic has a selective approach to new license acquisitions
targeting products with stable aftermarket demand and limited
competition. OEM relationships, reputation and expertise in part
transition are key to securing new licenses. The portfolio of
licenses is relatively stable, driven by flat or slightly declining
fleet sizes, increasing maintenance of ageing aircraft and price
inflation. However there has historically been a degree of
volatility within certain license vintages with risks of mid-single
digit revenue declines in any one year. The company is highly cash
generative prior to new license acquisitions with low capital
intensity and a focus on component assembly.

Leverage is relatively high at 7.5x (Moody's-adjusted) and Moody's
expects limited deleveraging as further debt drawdowns and surplus
cash will be utilized in acquiring new licenses. However, it is
noted that this spend is discretionary and will be earnings
accretive, and the credit is supported by solid steady-state cash
flows and relatively high visibility of earnings from the existing
portfolio.

Governance risks that Moody's considers in Ontic's credit profile
include: (1) financial policies which are likely to maintain
relatively high leverage including the use of additional debt
drawdowns and surplus cash to finance for license acquisitions; (2)
the possibility that new license acquisitions are made using debt
at a leverage-increasing multiple; (3) reliance on key individuals
to maintain strong OEM relationships and manage new license
transitions.

LIQUIDITY

Moody's considers Ontic's liquidity profile to be adequate,
supported by the undrawn $85 million revolving credit facility
(RCF) and the $75 million delayed draw term loan which is available
for general corporate and other purposes. The company is expected
to generate positive free cash flow on an annual basis, however,
the company is likely to use most of its surplus cash for the
acquisition of new licenses.

STRUCTURAL CONSIDERATIONS

The B2 ratings on the first lien term loan, delayed draw term loan
and revolving credit facility, are one notch above the CFR,
reflecting their seniority in the capital structure. The Caa2
rating on the second lien debt reflects its subordination to prior
ranking first lien debt.

The facilities are guaranteed by Bleriot Midco Limited and all its
material restricted subsidiaries, and secured over all US and UK
assets. There is a single point of enforcement through a pledge
over shares in Bleriot Midco Limited. The second lien is
contractually subordinated to the first lien facilities through an
intercreditor agreement.

OUTLOOK

The stable outlook reflects Moody's expectations that the company
will gradually reduce Moody's-adjusted leverage below the initial
level of 7.5x over the next 12-18 months, whilst maintaining
broadly stable revenues and EBITDA on an organic basis. It also
assumes that free cash flow (FCF) to debt is maintained at low
positive single digit percentages after investments in new license
acquisitions. In addition the outlook assumes that company
maintains adequate liquidity and no debt-financed acquisitions or
distributions will occur which result in a material increase in
leverage.

WHAT WOULD CHANGE THE RATINGS UP / DOWN

The ratings could be upgraded if Moody's-adjusted leverage reduces
sustainably towards 6x. It would also require material positive
free cash flow to be maintained after license acquisition spend,
and for FCF / debt prior to license acquisitions to be sustained in
the high single digit percentages. An upgrade would also require
that organic revenue and margin performance of the existing
portfolio remains at least stable, and that liquidity remains
adequate.

The ratings could be downgraded if the company fail to gradually
deleverage from 7.5x on a Moody's-adjusted basis, if free cash flow
turns negative, particularly on an organic basis, or if there is a
material decline in organic revenues or EBITDA margins. A downgrade
could also occur if liquidity concerns arise.

PRINCIPAL METHODOLOGY

The principal methodology used in these ratings was Aerospace and
Defense Industry published in March 2018.

COMPANY PROFILE

Ontic, headquartered in Cheltenham, England, is a leading provider
of OEM-licensed parts and repair and overhaul services to the
Aerospace & Defense industry, focusing on late lifecycle and legacy
products. The group has operations in three end market segments:
(1) Military, representing 57% of revenues, (2) Commercial
aviation, representing 37% of revenues and (3) Business & general
aviation, representing 6% of the revenues. In the last 12 months
ended June 30, 2019 Ontic reported pro forma revenues of $272
million.


FINASTRA LIMITED: Fitch Lowers IDR to B & Alters Outlook to Stable
------------------------------------------------------------------
Fitch Ratings downgraded Finastra Limited's Issuer Default Rating
to 'B' from 'BB-'. The Rating Outlook has been revised to Stable
from Negative.

The downgrade reflects slower than expected delevering in FY 2019,
as compared to Fitch's expectations, primarily due to the faster
than expected shift to a subscription based model, which in the
long term benefits the company but creates lower cash flow
initially as customers no longer make upfront payments to license
software. On the plus side, over the intermediate term revenue
around industry growth rates in the mid-single digits combined with
some margin expansion will provide for a moderate pace of
delevering.

KEY RATING DRIVERS

Stable Market Demand: Fitch believes Finastra's mission-critical
financial software products, strong level of recurring revenue and
sustained outsourcing trends by the company's financial institution
customer base provide a significant degree of visibility into
future revenue and cash flow. More than three-fourths of Finastra's
revenue is recurring, aided by a shift to a subscription-based
model for a significant portion of its revenue. Retention rates are
high at more than 90%.

End-Market Concentration: Finastra offers a broad portfolio of
products to banks and other financial institutions. Given its
product and geographic diversity, the company does not have
significant exposure to any one customer. However, the company has
significant exposure to banks and other financial institutions,
which exposes it to fluctuations in the level of banking activity,
which has some sensitivity to the economy and sector consolidation
trends. Cyclicality arises from customers' exposure to interest
rates.

Favorable Outsourcing Trends: Fitch believes financial institutions
will continue to look to third-party software providers to
outsource certain functions as they focus on core competencies,
streamline processes and reduce costs. Finastra's software can be
used across a broad array of functions in retail banking, corporate
banking and in banks' treasury and capital market functions.
Financial institutions continue to be under pressure due to
regulatory cost burdens. These organizations also need to invest in
technology to provide innovative products and services. Finastra's
software enables banks to integrate internet and mobile banking
into product offerings.

Scalable Business: Fitch believes Finastra's business is scalable
as its software solutions can be developed once and then deployed
many times across a broad customer base. In the future, banks are
expected to grow the use of third-party packaged software, which
can be integrated into existing operations. Finastra's products are
open and modular so they can fit into a banks existing
infrastructure, working with either the bank's own systems or with
other third-party software.

Leverage: At the end of FY2019, the company's leverage was 8.3x,
but it should improve going forward as the synergies from the Misys
and D&H combination were only nearly fully achieved in
third-quarter FY 2019. Additionally, the pressure on FCF and
working capital should abate, following a more rapid than expected
shift to a subscription-based model. This model, which is expected
to lead to higher total revenue in time, contributed to slower than
expected delevering than originally expected.

M&A Risk: The company made small bolt-on acquisitions following the
combination of Misys and D&H. Fitch does not expect Finastra to
engage in significant M&A activity in the near term. In the longer
term, Fitch would expect Finastra to continue to review potential
acquisitions to expand its geographic footprint and product
offerings.

Recovery: The recovery analysis assumes Finastra would be
considered a going concern in a bankruptcy and the company would be
reorganized rather than liquidated. Fitch assumed a 10%
administrative claim.

Finastra's going concern EBITDA of $595 million reflects Fitch's
estimate of EBITDA in FY2020 reduced by approximately 15% to
account for lower revenues that expected in a stress economic
environment combined with margin pressure. Fitch applies a 7x
multiple to arrive at a post-reorganization enterprise value of
approximately $4.2 billion. The multiple is higher than the median
telecom, media and technology enterprise value multiple but is in
line with other similar software companies rated by Fitch,
including financial industry software provider Ellie Mae.

In Fitch's Telecom, Media and Technology Bankruptcy Enterprise
Values and Creditor Recoveries (Fitch Case Studies - 21st Edition),
Fitch noted nine past reorganizations in the technology sector with
recovery multiples ranging from 2.6x to 10.8x. Of these companies,
only three were in the software sector: Allen Systems Group, Inc.;
Avaya, Inc. (B/Stable); and Aspect Software Parent, Inc., which
received recovery multiples of 8.4x, 8.1x, and 5.5x, respectively.
Finastra's strong market position and operating profile is
supportive of a recovery multiple in the upper end of this range;
Fitch views the company's currently weaker FCF as a product of the
shift to the subscription model that will normalize over time.

Assuming a fully drawn revolver and 10% administrative claims, the
analysis suggests a Recovery Rating of 'RR2' for the first-lien
facilities and RR6 for the second-lien facilities.

DERIVATION SUMMARY

Finastra's rating is supported by the improving level of recurring
revenue in its revenue mix as it evolves further to a subscription
based platform. The company has a strong position in providing
services to large, mid-sized and small financial institutions. The
company faces competition from other providers in key market
segments, including Fidelity National Information Services (FIS;
BBB/Stable). Finastra has been successful in driving synergies via
the combination of its predecessor companies, Misys and D+H
Corporation. Owing to the effect of the full year run rate of
synergies attained in FY 2019, Fitch expects EBITDA margins to
improve in FY 2020.

KEY ASSUMPTIONS

  -- Fitch expects revenue growth in the low- to mid-single
     digits, with core revenue growth in the mid-single digits

  -- EBITDA margins are expected to expand to the 36%-37% range
     over the rating horizon;

  -- Fitch does not expect material acquisitions in the near
     term but recognizes the potential for modest

bolt-on acquisitions.

RATING SENSITIVITIES

Developments That May, Individually or Collectively, Lead to
Positive Rating Action

  - A positive action could occur if the company appears to be
    on track to get total gross debt/operating EBITDA to 6.0x,
    or below, as it transitions to a subscriber-based business
    model;

  - Sustained total adjusted debt to EBITDAR below 6.0x;

  - Sustained EBITDA growth and a reduction in debt from the
    projected strengthening in the company's FCF position.

Developments That May, Individually or Collectively, Lead to
Negative Rating Action

  - A negative action could occur if total gross debt/
    operating EBITDA is sustained above 7.0x, if there
    is a material erosion in market share, or if margins
    do not improve as anticipated;

  - Sustained total adjusted debt to EBITDAR above 7.0x.

LIQUIDITY AND DEBT STRUCTURE

Liquidity: Finastra's USD400 million revolving credit facility had
approximately USD54 million drawn and the company had approximately
USD44 million of readily available cash on May 31, 2019.
Availability on the revolver, net of LOCs, was USD329 million.
Near-term maturities consist of approximately USD36 million
annually on the USD3.6 billion U.S. dollar portion of the
first-lien term loan and about EUR8 million annually on the EUR850
million European Euro portion of the first-lien term loan. The term
loan matures in 2024. There are no principal repayments due on the
second-lien credit agreement, which is due in 2025.


FINASTRA: S&P Affirms 'B-' ICR on Solid Operating Performance
-------------------------------------------------------------
S&P Global Ratings affirmed its 'B-' long-term issuer credit rating
on U.K.-based financial services software provider Finastra. S&P
also affirmed its 'B-' issue ratings on Finastra's first-lien
facilities and its 'CCC' issue rating on the second-lien term
loan.

S&P said, "The proposed refinancing has a neutral impact on
Finastra's credit metrics, which we expect to improve significantly
after the fiscal year (FY) ending May 31, 2020. Finastra plans to
reprice its EUR791 million euro-denominated first-lien term loan to
EURIBOR plus 300 bps from EURIBOR plus 325 bps. In addition,
Finastra plans to issue a EUR90 million add-on euro-denominated
first-lien term loan. As the proceeds from the add-on will be used
to repay borrowings under the revolving credit facility (RCF), the
impact on Finastra's S&P Global Ratings-adjusted leverage will be
neutral, while the repricing will marginally reduce Finastra's
interest expenses.

"We expect Finastra's credit metrics will remain weak in FY2020,
predominantly due to still-high exceptional costs, as well as the
continued negative impact of the transition to subscription
revenues from the previous license and maintenance model. The
latter means that cash receipts from customers are still weaker
compared with the upfront license model, but are on a growth
trajectory since the initial year of transition, as subscription
contracts signed in the previous year continue to generate an
ongoing cash stream. We forecast Finastra's free cash flow to
remain negative in FY2020 as we anticipate relatively material
exceptional cash outflows, but we also expect the cash burn to
continue to decline, with free cash flows before exceptional items
at about $10 million-$20 million. We also note that capital
expenditure (capex) in FY2020 should include remaining items
related to office moves from the integration with D+H, which should
be largely done this year, supporting a reduction in capex before
capitalized development costs. In FY2021, after especially high
exceptional costs fall away and EBITDA generation improves further,
we expect Finastra to deliver positive free cash flow of about $50
million-$80 million.

"We expect leverage to remain high at 10.6x excluding PECs (or
12.9x total leverage) in FY2020 on an S&P Global Ratings-adjusted
basis. This reflects continued high exceptional cash outflows,
including remaining severance costs on headcount reduction from the
integration of D+H and one-off nonoperational exceptional items.
Excluding these items, we expect core EBITDA margins to continue to
improve to about 39%-40% thanks to further realization of cost
synergies.

"We see relatively limited headroom under the rating given the
limited cash flow generation and high leverage, but we think that
in the case of a potential operating underperformance Finastra has
capacity to reduce some of its R&D investments in Fusion Fabric,
which are more discretionary in nature."

Finastra's liquidity position remains supported by still-sizable
availability under its RCF, amounting to $152.5 million as of Aug.
31, 2019 (before the October refinancing transaction). This should
help Finastra absorb negative cash flow in the near term, which is
partly the result of still-elevated discretionary spending on R&D,
marketing, and restructuring activities, before transitioning to
delivering positive and growing free cash flows on a sustained
basis from FY 2021.

The company's strategic shift to a subscription-fee pricing model
means that predictability of its operating performance has improved
compared with previous license and maintenance model. Following the
transition of legacy Misys customers to the subscription-fee model,
subscription bookings have risen to 80% of software bookings
(excluding maintenance). As a result, the share of recurring
revenue has risen above 75% (above 90% incorporating visible
services revenue). Revenue visibility is underpinned by a
significant contracted revenue backlog, which grew by 37% in FY2019
to $3.9 billion.

Finastra's business risk profile also continues to be supported by
its position as the second-largest global pure-play provider of
financial services software, after SS&C Technologies, and by the
mission-critical nature of its software, as reflected in a client
retention rate of 97% in FY2019. In addition, Finastra's product
portfolio is diverse, with end-to-end systems from front-office to
back-office, and we expect it to be significantly enhanced over the
medium term by the growing development and sale of applications by
third parties on Finastra's open development platform,
FusionFabric.cloud.

Finastra's S&P Global Ratings- adjusted EBITDA margin, which was
about 27% in FY2019, remains below-average relative to mid-30%
margins for peers such as SS&C, impeding a more favorable
assessment of its business risk profile. S&P's adjusted EBITDA
calculation includes nonrecurring costs and expenses capitalized
software development costs.

S&P said, "The stable outlook reflects our expectation that 1%-2%
revenue growth, improving EBITDA margins, and a better working
capital profile will enable Finastra to generate positive FOCF
excluding exceptional items in FY2020 and FOCF of $50 million-$80
million in FY2021. For FY2021, we also expect deleveraging toward
about 9.5x excluding preferred equity certificates (PECs), or about
12x total leverage, and EBITDA cash interest coverage of about 1.5x
or above.

"We could lower our rating if weak revenue performance and a lack
of improvement in adjusted EBITDA margins means that FOCF excluding
exceptional costs remains negative in FY2020 and EBITDA cash
interest coverage is well below 1.5x. In particular, these factors
could lead us to believe that the group's capital structure is
unsustainable over the medium term despite no immediate liquidity
pressures. We could also lower the rating if liquidity becomes less
than adequate, or covenant headroom falls below 10%.

"We see upside for the rating as remote over the next 12 months due
to Finastra's high leverage and our expectations of only limited
FOCF generation excluding exceptional costs."

An upgrade would require leverage falling sustainably below 8x
excluding PECs (or about 10.5x total leverage), while FOCF to debt
rises to at least 3%.

S&P said, "Alternatively, we could raise the rating if, alongside
improvement in cash flow generation, there is an improvement in
adjusted EBITDA margins to about 35%, with positive revenue growth
on a sustained basis and maintenance of a recurring revenue share
of at least 75%. This would likely cause us to take a more
favorable view of Finastra's business risk profile."


SOLENIS UK: S&P Assigns B- Issuer Credit Rating, Outlook Negative
-----------------------------------------------------------------
S&P Global Ratings assigned its 'B-' issuer credit rating to
Solenis UK International Ltd., with a negative outlook.

S&P said, "We are affirming our 'B-' issuer credit rating on
Solenis International LLC, revising the outlook to negative, and
subsequently withdrawing the rating on this entity. At the same
time, we are affirming our issue-level ratings on the company's
credit facility and first- and second-lien term loans."

The negative outlook reflects the slightly weaker-than-expected
earnings on a pro forma basis for the BASF SE paper and water
transaction, combined with higher-than-expected debt levels, for
2019. Though synergies seem to be on track, the integration is more
costly than previously expected. This, and a recent
underperformance of the acquired business, has caused the company
to draw additional amounts on the revolver above what S&P's
previously expected.

S&P said, "The negative outlook on Solenis reflects our expectation
that leverage will remain above our previous expectations and there
is now less cushion than before at the current rating, which makes
Solenis more vulnerable to any potential weakness in demand. We now
believe that S&P Global Ratings-adjusted EBITDA will remain above
7x over the next 12 months. The slightly increased leverage takes
into account the higher-than-expected costs the company has
incurred as it integrates the BASF paper and water business, which
caused the company to draw additional amounts on its revolver. It
also reflects the weaker global macroeconomic environment that we
are expecting. In our base case scenario, we do not assume that
CD&R increases its investment in the combined company beyond its
51% ownership.

"We could lower the rating on Solenis over the next year if we
believe leverage will reach unsustainable levels, such that debt to
adjusted EBITDA approaches double digits. Debt to EBITDA could
approach this level if the company faces weaker demand in its end
markets or EBITDA margins drop 200 basis points (bps) below
expectations (after taking into account expected cost synergies),
which could happen if it cannot pass along price increases to its
customers to adequately cover raw material inflation in a timely
manner in some business lines. We could also lower the ratings if
liquidity weakens so that we believe that sources of funds will
decline to below 1.2x uses or if we believe the company has no
prospects of generating positive free cash flow. We could also
consider a lower rating if CD&R increases its ownership in the
combined company through increased leverage.

"We could return the outlook to stable if we believed that leverage
would improve such that debt to S&P Global Ratings-adjusted EBITDA
remained around 7x on a sustainable basis. This could happen if the
BASF performance improves and synergy targets exceed expectations,
combined with a favorable operating environment. We could raise the
rating if the company demonstrates an ability post-integration to
materially improve business strength and performance exceeds our
expectations, resulting in improved debt to EBITDA below 6.5x on a
sustained basis. We would also expect liquidity sources to remain
above 1.2x uses and for the company to have adequate cushion on its
springing covenant. Actions by management and owners regarding
Solenis' financial policy would also be an important consideration
in whether to raise ratings."


THOMAS COOK: EU Approves EUR380 Million Condor Rescue Loan
----------------------------------------------------------
Pietro Lombardi at Dow Jones Newswires reports that European Union
antitrust authorities have approved Germany's EUR380 million
(US$419.3 million) rescue loan to charter airline Condor.

The bridge loan, which was announced in September, is designed to
salvage Condor from the bankruptcy of its corporate parent, Thomas
Cook Group PLC, Dow Jones discloses.

According to Dow Jones, the temporary loan will help avoid
disruptions for passengers "without unduly distorting competition,"
the European Commission, the bloc's antitrust authority, said on
Oct. 14.

It said the loan comes with stringent conditions, Dow Jones notes.
The German government will ensure that the loan is repaid after six
months or the company will undergo a comprehensive overhaul, Dow
Jones states.

                    About Thomas Cook Group

Thomas Cook Group Plc is the ultimate holding company of direct and
indirect subsidiaries, which operate the Thomas Cook leisure travel
business around the world.  TCG was formed in 2007 following the
merger between Thomas Cook AG and MyTravel Group plc.
Headquartered in London, the Group's key markets are the UK,
Germany and Northern Europe.  The Group serves 22 million customers
each year.

The Group operates from 16 countries, with a combined fleet of over
100 aircraft through five entities holding air operator
certificates in the UK, Germany, Denmark and Spain.  The Group has
2,800 owned and franchised retail outlets (including 555 shops in
the UK) and operates 199 own-brand hotels across the world.

As of Dec. 31, 2018, the Group had 21,263 employees, including
9,000 in the U.S.

The travel agent originally proposed a restructuring.  It was
scheduled to ask creditors Sept. 27, 2019, for approval of a scheme
of arrangement that involves (a) substantially deleveraging the
Group by converting GBP1.67 billion of RCF and Notes debt currently
outstanding into new shares (15%) and a subordinated PIK note (at
least GBP81 million) to be issued by the recapitalized Group in
proportions still to be agreed; and (b) the transfer of at least a
75% interest in the Group Tour Operator and an interest of up to
25% in the Group Airline to Chinese investor Fosun Tourism Group.

Representatives of the company filed a Chapter 15 petition in New
York on Sept. 16, 2019, to seek U.S. recognition of the UK
proceedings as foreign main proceeding.  The Chapter 15 case is In
re Thomas Cook Group Plc (Bankr. S.D.N.Y. Case No. 19-12984).
Latham & Watkins, LLP is the counsel.

But after last-ditch rescue talks failed, on Sept. 23, 2019, Thomas
Cook UK Plc and associated UK entities announced that they have
entered Compulsory Liquidation and are now under the control of the
Official receiver.  The UK business has ceased trading with
immediate effect and all future flights and holidays are cancelled.
All holidays and flights provided by Thomas Cook Airlines have
been cancelled and are no longer operating.  All Thomas Cook's
retail shops have also closed.  

Separate from the parent company, Thomas Cook's Indian, Chinese,
German and Nordic subsidiaries will continue to trade as normal.



                           *********


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
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