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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

          Thursday, January 23, 2020, Vol. 21, No. 17

                           Headlines



F R A N C E

EUROPCAR MOBILITY: Moody's Confirms B1 CFR & Alters Outlook to Neg.
RALLYE SA: Fails to Win Support for 10-Year Debt Repayment Plan


G E R M A N Y

TECHEM VERWALTUNGSGESELLSCHAFT: Moody's Rates New EUR600MM Notes B1


I R E L A N D

JUBILEE CLO 2015-XV: Moody's Affirms EUR27MM Class E Notes at Ba2


L U X E M B O U R G

AI CONVOY: Fitch Assigns 'B(EXP)' LongTerm IDR, Outlook Stable
AI CONVOY: Moody's Assigns B2 Corp. Family Rating, Outlook Stable
AI CONVOY: S&P Assigns Preliminary 'B' ICR, Outlook Stable


N E T H E R L A N D S

ADRIA MIDCO: Moody's Confirms B2 CFR & Alters Outlook to Stable


S P A I N

DIA GROUP: Spanish Magistrate Launches Criminal Investigation
FTPYME TDA CAM 4: S&P Affirms 'D(sf)' Rating on Class D Notes
IM SABADELL PYME 11: Moody's Hikes EUR332.5MM Class B Notes to B2


U N I T E D   K I N G D O M

ARCADIA GROUP: To Close Additional 10 UK Stores in Coming Months
DELPHI TECHNOLOGIES: Moody's Lowers CFR to B1, Outlook Neg.
E-MAC PROGRAM 2008-IV: Fitch Affirms B+sf Rating on Class D Debt
FLYBE: Ryanair Mulls Legal Action Against UK Gov't. Over Bailout
MONSOON AND ACCESSORIZE: Woking Store to Close on January 28

PREFERRED RESIDENTIAL 06-1: Fitch Upgrades Class FTc Debt to Bsf
PREMIER OIL: Creditors Lodge Report Against Lender to FCA
TED BAKER: Accounting Error Bigger Than Previously Thought
[*] UK: Scottish Corporate Insolvencies Up 4% to 980 in 2019

                           - - - - -


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F R A N C E
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EUROPCAR MOBILITY: Moody's Confirms B1 CFR & Alters Outlook to Neg.
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Moody's Investors Service confirmed Europcar Mobility Group S.A.'s
ratings including the corporate family rating of B1 and the
probability of default rating of B1-PD. EMG is the leading car
rental company in Europe. Concurrently, Moody's has also confirmed
the B3 ratings on the senior unsecured notes due 2024 and 2026 at
Europcar Mobility Group S.A., and the B1 rating on the senior
secured notes at EC Finance plc.

The outlook on both entities has been changed to negative from
ratings under review.

The rating action concludes the review process initiated by Moody's
on October 29, 2019.

RATINGS RATIONALE

"The negative outlook on EMG's ratings reflects the risk that its
credit metrics, notably Moody's-adjusted debt/EBITDA and
EBIT/Interest of around 5.1x and 1.2x respectively at year-end 2019
based on our estimates, will remain weak for the current B1 CFR
over the next 12-18 months if continued soft market conditions lead
to sustained market fleet overcapacity and price pressure", says
Eric Kang, Moody's lead analyst for EMG. "That said, we expect the
company to be able to adjust in a timely manner its fleet size to
protect utilization rates in the event of a material fall in demand
thanks to the flexibility provided by the use of buyback and
operating leases financings", adds Mr Kang.

Moody's expects the weaker macroeconomic outlook for the largest
European countries and Brexit-related uncertainties will continue
to pressure revenue per day (RPD) and rental days in the corporates
segment of the Cars business unit. Moody's also expects competition
in the Low Cost business unit to remain fierce which would
constrain improvement in RPD although this could be offset by
continued growth in rental days. In the Vans and Trucks business
unit, Moody's expects growing revenue coming from the corporate
segment with longer average rental durations to result in lower
RPD, broadly in line with the last two years.

There is also execution risk associated with the company's
objective to generate EUR60 million of gross cost savings by 2020
although Moody's understands it has already achieved EUR10 million.
The expected savings relate to (1) the rationalisation of
headquarters costs such as real estate, and (2) the centralisation
of certain support functions and network optimisation in terms of
processes, sizes, formats, and locations. These savings would also
partly be offset by higher fleet holding costs related to higher
vehicle taxes.

LIQUIDITY

EMG's liquidity is adequate, although it has weakened due to the
recent operating underperformance. As of September 2019, the
company had EUR225 million of unrestricted cash on balance sheet
and EUR183 million availability under the multi-purpose revolving
credit facility due 2022.

Given the capital intensity of the car rental industry, ongoing
access to fleet financing facilities at attractive interest
conditions is key to protect the competitivity of EMG's business
model. A significant portion of the fleet operated in France,
Germany, Italy and Spain is financed through a dedicated
asset-based financing structure, made of (1) the securitized EUR1.7
billion Senior Asset Revolving Facility (SARF), of which EUR1,365
million was drawn as of September 2019; and (2) the EUR500 million
senior secured notes at the level of EC Finance plc. This dedicated
structure is mainly secured by the financed fleet and the related
receivables. Additional fleet financing capacity is provided by the
RCF which could be used for both fleet and non-fleet funding needs.
There are also other local facilities dedicated to fleet financing
such as the facilities in the UK, and in Australia and New
Zealand.

The RCF includes a financial maintenance covenant, requiring the
cash flow cover to debt service to remain above 1.10:1, for which
Moody's expects the company to maintain good headroom. The senior
secured and unsecured notes have standard incurrence covenant
terms. The SARF and the senior secured notes are subject to a
quarterly loan-to-value maintenance test of a maximum of 95%.

ESG CONSIDERATIONS

Moody's considers social risks for the broad equipment and
transportation rental industry to be low. However, EMG is
particularly exposed to customer relation issues. The company is
still being investigated by the UK Trading Standards authority with
respect to alleged systematic overcharging of customers for repairs
over multiple years. The company is currently cooperating with the
UK authorities and accrued a provision of EUR43 million in 2017.
The investigation has been ongoing since June 2017. It is Moody's
understanding that no further investigations are currently ongoing
in the UK or in any other significant investigation in other
markets where the company operates. That said, Moody's also
recognises the company's efforts to improve customer satisfaction
in recent years which resulted in an improvement of the net
promoter score of the Europcar brand to 56.4% in 2018 from 49.6% in
2016.

Governance considerations include the potential changes to EMG's
ownership structure. On December 2, 2019, EMG announced that it set
up an independent ad hoc committee in relation to Eurazeo's
announcement on November 14, 2019 that it is reviewing strategic
options with respect to its c.30% stake in EMG. Until the details
of the transaction are known, or if Eurazeo will be successful in
the sale of its stake, it will be difficult to determine what will
be the precise impact on EMG's capital structure. Moody's
understands that there is a wide range of potential buyers
including corporate buyers and private equity firms.

STRUCTURAL CONSIDERATIONS

For the purpose of Moody's Loss Given Default (LGD) assessment, the
securitisation and the local fleet financing facilities have been
excluded as they have been considered to be self-liquidating in the
event of a default. In addition, these facilities have ring-fenced
security over the fleet assets but do not have a claim on the
operating businesses.

The B3 instrument ratings on the EUR600 million senior unsecured
notes due 2024 and the EUR450 million senior unsecured notes due
2026 reflect their relatively weaker security package and/or the
absence of guarantees from operating subsidiaries compared with
EMG's other debt facilities, including the EUR650 million RCF due
2022 and the EUR500 million senior secured notes due 2022 (the
fleet notes).

The fleet notes, rated B1, benefit from guarantees by Europcar
International S.A.S.U. and Europcar Mobility Group S.A. while the
RCF benefits from share pledges, as well as guarantees, by the
majority of EMG's operating entities. Moody's notes that a payment
default under certain master operating leases entered with fleetcos
in relation to the SARF could trigger a cross default under the
RCF. With regards to priority of payments among the fleetcos, the
fleet notes rank junior relative to sizeable fleet debt such as the
SARF. The SARF has a first priority ranking on some fleet assets
and receivables under buy-back agreements while the fleet notes
have second priority interest on same fleet assets and
receivables.

The company has two different intercreditor agreements (ICAs): an
ICA which regulates fleet entities and their fleet financing debt
and a corporate ICA which regulates opcos and the corporate debt
such as RCF and senior unsecured notes.

RATING OUTLOOK

The negative outlook reflects the risk that the company's credit
metrics will remain weak for the current B1 CFR over the next 12-18
months if continued soft market conditions lead to sustained market
fleet overcapacity and price pressure. Moody's will consider
stabilizing the outlook if the company demonstrates a track record
of earnings growth over the next 12-18 months leading to credit
metrics reverting back to levels in line with the B1 CFR as
described.

FACTORS THAT COULD LEAD TO AN UPGRADE/DOWNGRADE

Negative pressure could arise if as a result of deterioration
market conditions, weaker operating performance, or a more
aggressive financial policy, the Moody's-adjusted debt/EBITDA ratio
remains sustainably above 5.0x at year-end, the Moody's-adjusted
EBIT/Interest ratio remains below 1.25x, or the liquidity position
further weakens.

Upward rating pressure could develop if (1) the Moody's-adjusted
debt/EBITDA is sustainably below 4.0x at fiscal year-end, (2) the
Moody's EBIT/Interest increases towards 2.0x, and (3) the company
maintains a solid liquidity profile including positive underlying
free cash flow. An upgrade would also require a track record of
continued organic growth in revenues and earnings.

LIST OF AFFECTED RATINGS

Issuer: Europcar Mobility Group S.A.

Confirmations:

Probability of Default Rating, Confirmed at B1-PD

Corporate Family Rating, Confirmed at B1

Senior Unsecured Regular Bond/Debenture, Confirmed at B3

Outlook Action:

Outlook, Changed To Negative From Ratings Under Review

Issuer: EC Finance plc

Confirmation:

Backed Senior Secured Regular Bond/Debenture, Confirmed at B1

Outlook Action:

Outlook, Changed To Negative From Ratings Under Review

PRINCIPAL METHODOLOGY

The principal methodology used in these ratings was Equipment and
Transportation Rental Industry published in April 2017.

COMPANY PROFILE

Headquartered in Paris, France, Europcar Mobility Group S.A. is the
European leader in car rental services, providing short- to
medium-term rentals of passenger vehicles and light trucks to
corporate, leisure and replacement clients. It generated total
revenue of EUR2.9 billion in 2018.


RALLYE SA: Fails to Win Support for 10-Year Debt Repayment Plan
---------------------------------------------------------------
Fabian Graber at Bloomberg News reports that Rallye SA,
Casino-Guichard Perrachon SA's parent company, failed to win the
support from holders of four out of five euro bonds for plans to
repay EUR1.6 billion of debt over 10 years, according to a
statement.

According to Bloomberg, creditor votes are not binding for the
Paris court which is due to rule on the plan by the end of March.

The company will have to repay unsecured debt over 10 years under
proposal agreed with banks, Bloomberg discloses.

The EUR1.2 billion of bank loans would be redeemed by 2024,
Bloomberg states.

As reported by the Troubled Company Reporter-Europe on Nov. 27,
2019, Reuters related that debt-burdened Rallye said the company
and other shareholders of French retailer Casino agreed with
bankers to extend by six months an observation period of
proceedings with creditors and confirmed their objective to have a
draft rescue plan cleared by early 2020.  Casino Chairman and Chief
Executive Officer Jean-Charles Naouri in May had placed parent
companies Rallye, Finatis and Fonciere Euris under protection from
creditors in a bid to save the group from collapse, Reuters
recounts.  According to Reuters, in September, Rallye, Fonciere
Euris, Finatis and Euris had said that the draft rescue plan, drawn
up with the assistance of judicial administrators, involved
repayment over a 10-year period of all liabilities.  Casino's net
debt stood at EUR2.71 billion at the end of 2018, and Rallye's
stood at EUR2.90 billion, Reuters disclosed.  Casino has been
struggling in France, where a price war among supermarkets has
dented retailers' profit margins, Reuters noted.

                         About Rallye SA

France-based Rallye S.A., together with its subsidiaries, engages
in the food, non-food e-commerce, and sporting goods retailing
activities in France and internationally.  It operates
hypermarkets, supermarkets, and discount stores.  The company
conducts its retailing activities in France primarily under the
Casino, Monoprix, Franprix-Leader Price, and Vindemia banners; food
retail activities in Latin America primarily under the Exito,
Disco, Devoto, and Libertad banners, as well as GPA food banner;
and e-commerce comprising Cdiscount and the Cnova N.V. holding
company businesses.  




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TECHEM VERWALTUNGSGESELLSCHAFT: Moody's Rates New EUR600MM Notes B1
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Moody's Investors Service, assigned a B1 rating to the proposed
EUR600 million senior secured notes to be issued by Techem
Verwaltungsgesellschaft 675 mbH. At the same time Moody's affirmed
the B2 corporate family rating and the B2-PD probability of default
rating of Techem Verwaltungsgesellschaft 674 mbH.

Moody's also affirmed the B1 rating of the senior secured first
lien term loan (B and B3) maturing in 2025 and the senior secured
revolving credit facility raised by Techem Verwaltungsgesellschaft
675 mbH and the Caa1 rating of the senior secured second lien notes
due 2026 raised by Techem. The outlook on all aforementioned
ratings remains stable.

Proceeds from the new issuance will be used to refinance part of
the existing term loan B.

RATINGS RATIONALE

Techem's ratings reflect the company's (1) strong profitability
with a Moody's-adjusted EBITDA margin in the high 40s, driven by
its leading position in the German sub-metering market and growing
supplementary services business; (2) good revenue visibility and
stability because of the non-discretionary nature of demand for
energy services, long-term contracts with customers and a
supportive regulatory environment; (3) solid market position, with
strong levels of customer loyalty and high barriers to entry
because of significant investment requirements to replicate
Techem's business model; and (4) positive free cash flow
generation, which could be used for debt repayments.

However, the rating is constrained by (1) the group's very high
Moody's-adjusted leverage ratio of around 7.4x on a pro forma basis
for the 12 months ended September 2019, following Techem's
acquisition by the consortium led by Partners Group in 2018; (2)
the company's modest geographical diversification, with around 25%
of group revenue being generated outside of Germany; and (3) the
lower profitability in Techem's energy contracting business.

STRUCTURAL CONSIDERATIONS

In the loss-given-default (LGD) assessment for Techem, based on the
structure post the envisaged refinancing, Moody's ranks pari passu
the senior secured EUR 1,690 million term loan B, the new EUR 600
million senior secured notes, and the EUR275 million RCF, (all
maturing in 2025), which share the same security and are guaranteed
by certain subsidiaries of the group accounting for at least 80% of
consolidated EBITDA. The B1 (LGD3) ratings on the senior secured
instruments reflect their priority position in the group's capital
structure and the benefit of loss absorption provided by the junior
ranking debt.

The EUR414 million of senior secured second lien notes (due 2026)
are secured by certain holding company collateral on a
first-ranking basis, and share the same guarantors and part of the
same collateral as the senior secured credit facilities on a
subordinated basis. This is reflected in the Caa1 (LGD6) rating
assigned to the notes. Moody's has considered trade payables as
ranking at the level of the senior secured credit facilities and
pension obligations and minimum lease rejection claims at operating
subsidiaries at the level of the senior secured second lien notes.

The group's capital structure further includes shareholder loans,
which qualify for 100% equity treatment by Moody's and are
therefore not included in the LGD assessment and debt calculations
for the group.

ESG CONSIDERATIONS

Moody's takes into account the impact of ESG factors when assessing
companies' credit quality. The main environmental and social risks
are not material in case of Techem. However, the company is owned
by a consortium led by the private equity firm Partners Group and
which includes Caisse de depôt et placement du Quebec ("CDPQ") and
Ontario Teachers' Pension Plan ("OTPP"). As a result, Moody's
expects Techem's financial policy to favour shareholders over
creditors as evidenced by its high leverage. However, in the
near-term the company foresees no dividend distribution and targets
deleveraging instead. This has been proved by two voluntary debt
repayments in 2019. Its understanding is that large M&A deals are
not targeted, but smaller add-on acquisitions are possible.

LIQUIDITY

Techem's short-term liquidity is good. The group's internal cash
sources comprise around EUR101 million of cash on balance sheet as
of September 2019, as well as cash flow from operations of around
EUR250 million per annum. Together with the undrawn EUR275 million
RCF these funds will cover all expected cash needs in the next
12-18 months. Cash uses mainly include Moody's-adjusted capital
spending (around EUR180 million per annum) and an assumed minimum
cash level to run day to day operations that Moody's estimates to
be around 3% of revenue.

The liquidity assessment also considers that there is one springing
covenant (senior secured net leverage ratio) attached to the new
RCF, which is tested if the RCF is drawn by more than 40% and which
has currently ample headroom.

OUTLOOK

The stable outlook reflects Moody's expectation that Techem will
continue to grow its revenue and can maintain its high
profitability in a supportive regulatory environment in Germany and
Europe. Moreover, Moody's expects the group to adhere to a
thoughtful and prudent financial policy, as shown by free cash
flows used for debt repayments and a sustained sound liquidity
profile. As a result, Moody's-adjusted debt/EBITDA is likely to
remain below 7.5x (7.4x as of September 2019) over the next 12-18
months.

WHAT COULD CHANGE THE RATING UP/DOWN

An upgrade of Techem's ratings would require (1) leverage to
decline sustainably below 6.5x Moody's-adjusted debt/EBITDA, (2)
retained cash flow/net debt (Moody's-adjusted) to increase above
10%, and (3) a track record of a prudent financial policy,
evidenced by available cash flow being applied to debt reduction.

Downward pressure on Techem's ratings would build in case of (1)
inability to maintain leverage below 7.5x debt/EBITDA over the next
12-18 months, (2) retained cash flow/net debt (Moody's-adjusted)
declined to mid-single digits and (3) free cash flow
(Moody's-adjusted) turned negative. Downward pressure on the B1
instrument ratings could also develop in case of further
substantial repayments of the junior ranking debt, which provides a
cushion to the senior secured debt and thus leads to the uplift of
the instrument rating versus the CFR.

LIST OF AFFECTED RATINGS

Issuer: Techem Verwaltungsgesellschaft 674 mbH

Affirmations:

LT Corporate Family Rating, Affirmed B2

Probability of Default Rating, Affirmed B2-PD

BACKED Senior Secured Regular Bond/Debenture, Affirmed Caa1

Outlook Actions:

Outlook, Remains Stable

Issuer: Techem Verwaltungsgesellschaft 675 mbH

Affirmations:

Senior Secured Bank Credit Facility, Affirmed B1

Assignments:

Senior Secured Regular Bond/Debenture, Assigned B1

Outlook Actions:

Outlook, Remains Stable

PRINCIPAL METHODOLOGY

The principal methodology used in these ratings was Business and
Consumer Service Industry published in October 2016.

CORPORATE PROFILE

Headquartered in Eschborn, Germany, Techem is a leading provider of
energy services operating through two divisions - energy services
(accounting for 88% of group sales in the 12 months ended September
2019) and energy contracting (12%). Energy Services provides
sub-metering of heat and water consumption for multi-dwelling
housing units, energy cost allocation and billing services. The
segment also offers supplementary services such as smoke detector
installation and maintenance and legionella analysis in drinking
water. Energy Contracting offers a holistic management of clients'
energy consumption through the planning, financing, construction
and operation of heat stations, boilers, cooling equipment and
combined heating and power units. For the 12 months ended September
2019, Techem generated total revenue of around EUR778 million of
which 77% was generated in Germany. In 2018, Techem's previous
owner, Macquarie sold the company to a consortium led by private
investment manager, Partners Group, for an enterprise value of
EUR4.6 billion.




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JUBILEE CLO 2015-XV: Moody's Affirms EUR27MM Class E Notes at Ba2
-----------------------------------------------------------------
Moody's Investors Service upgraded the ratings of the following
notes issued by Jubilee CLO 2015-XV B.V.:

  EUR60,250,000 Refinancing Class B Senior Secured Floating Rate
  Notes due 2028, Upgraded to Aa1 (sf); previously on Oct 12,
  2017 Assigned Aa2 (sf)

  EUR26,000,000 Refinancing Class C Deferrable Mezzanine Floating
  Rate Notes due 2028, Upgraded to A1 (sf); previously on Oct 12,
  2017 Assigned A2 (sf)

  EUR23,500,000 Refinancing Class D Deferrable Mezzanine Floating
  Rate Notes due 2028, Upgraded to Baa1 (sf); previously on
  Oct 12, 2017 Assigned Baa2 (sf)

Moody's has also affirmed the ratings of the following notes:

  EUR252,750,000 Refinancing Class A Senior Secured Floating Rate
  Notes due 2028, Affirmed Aaa (sf); previously on Oct 12, 2017
  Assigned Aaa (sf)

  EUR27,000,000 Class E Deferrable Junior Floating Rate Notes
  due 2028, Affirmed Ba2 (sf); previously on Oct 12, 2017
  Affirmed Ba2 (sf)

  EUR15,250,000 Class F Deferrable Junior Floating Rate Notes
  due 2028, Affirmed B1 (sf); previously on Oct 12, 2017
  Upgraded to B1 (sf)

Jubilee CLO 2015-XV B.V., issued in June 2015 and refinanced in
October 2017, is a collateralised loan obligation backed by a
portfolio of mostly European broadly syndicated first lien senior
secured corporate loans. The portfolio is managed by Alcentra
Limited. The transaction's reinvestment period ended in July 2019.

RATINGS RATIONALE

The rating actions on the notes are primarily a result of the
transaction having reached the end of the reinvestment period in
July 2019.

In light of reinvestment restrictions during the amortisation
period, and therefore the limited ability to effect significant
changes to the current collateral pool, Moody's analysed the deal
assuming a higher likelihood that the collateral pool
characteristics would maintain an adequate buffer relative to
certain covenant requirements.

The key model inputs Moody's uses in its analysis, such as par,
weighted average rating factor, diversity score and the weighted
average recovery rate, are based on its published methodology and
could differ from the trustee's reported numbers as of December
2019. In its base case, Moody's analysed the underlying collateral
pool as having a performing par and principal proceeds balance of
EUR 429.5 million, a weighted average default probability of 23.6%
(consistent with a WARF of 3146 and weighted average life of 4.79
years ), a weighted average recovery rate upon default of 46.1% for
a Aaa liability target rating, a diversity score of 52 and a
weighted average spread of 3.58%.

The default probability derives from the credit quality of the
collateral pool and Moody's expectation of the remaining life of
the collateral pool. The estimated average recovery rate on future
defaults is based primarily on the seniority of the assets in the
collateral pool. In each case, historical and market performance
and a collateral manager's latitude to trade collateral are also
relevant factors. Moody's incorporates these default and recovery
characteristics of the collateral pool into its cash flow model
analysis, subjecting them to stresses as a function of the target
rating of each CLO liability it is analysing.

Methodology Underlying the Rating Action:

The principal methodology used in these ratings was " Moody's
Global Approach to Rating Collateralized Loan Obligations "
published in March 2019.

Counterparty Exposure:

The rating action took into consideration the notes' exposure to
relevant counterparties, such as account bank, using the
methodology "Moody's Approach to Assessing Counterparty Risks in
Structured Finance" published on November 2019. Moody's concluded
the ratings of the notes are not constrained by these risks.

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

This transaction is subject to a high level of macroeconomic
uncertainty, which could negatively affect the ratings on the note,
in light of uncertainty about credit conditions in the general
economy. CLO notes' performance may also be impacted either
positively or negatively by 1) the manager's investment strategy
and behaviour and 2) divergence in the legal interpretation of CDO
documentation by different transactional parties because of
embedded ambiguities.

Additional uncertainty about performance is due to the following:

  -- Portfolio amortisation: The main source of uncertainty in this
transaction is the pace of amortisation of the underlying
portfolio, which can vary significantly depending on market
conditions and have a significant impact on the notes' ratings.
Amortisation could accelerate as a consequence of high loan
prepayment levels or collateral sales by the collateral manager.
Fast amortisation would usually benefit the ratings of the notes
beginning with the notes having the highest prepayment priority.

  -- Weighted average life: The notes' ratings are sensitive to the
weighted average life assumption of the portfolio, which could
lengthen as a result of the manager's decision to reinvest in new
issue loans or other loans with longer maturities, or participate
in amend-to-extend offerings. The effect on the ratings of
extending the portfolio's weighted average life can be positive or
negative depending on the notes' seniority.

In addition to the quantitative factors that Moody's explicitly
modelled, qualitative factors are part of the rating committee's
considerations. These qualitative factors include the structural
protections in the transaction, its recent performance given the
market environment, the legal environment, specific documentation
features, the collateral manager's track record and the potential
for selection bias in the portfolio. All information available to
rating committees, including macroeconomic forecasts, input from
other Moody's analytical groups, market factors, and judgments
regarding the nature and severity of credit stress on the
transactions, can influence the final rating decision.




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AI CONVOY: Fitch Assigns 'B(EXP)' LongTerm IDR, Outlook Stable
--------------------------------------------------------------
Fitch Ratings assigned AI Convoy (Luxembourg) S.a.r.l an expected
Long-Term Issuer Default Rating of 'B(EXP)'. The company is the
borrower and owner of UK-based aerospace and defense contractor,
Cobham. At the same time, Fitch has assigned an expected instrument
rating of 'B+(EXP)'/'RR3' to AI Convoy's proposed EUR885 million
and USD1,188 million first-lien senior secured debt. The Outlook on
the expected IDR is Stable.

The ratings reflect the company's moderate business profile,
characterised by good product, customer and geographical
diversification, a long history of development of high tech
products for the aerospace and defense industry as well as exposure
to end-markets with good underlying demand dynamics. These factors
are somewhat offset by the company's modest scale and limited
position on key programmes as a tier 2/3 supplier.

Fitch expects the company's financial profile after closing to
exhibit high leverage, both on a gross and net basis, which acts as
a constraining rating factor in the short to medium term. Fitch
believes leverage is sustainable owing to the already strong cash
generation capability, both on a funds from operations (FFO) and
free cash flow (FCF) basis, which is expected to gradually improve
as the company's cost structure is addressed by the new owners, and
underpins the group's debt repayment capacity.

The Stable Outlook reflects its expectation that the company will
continue to generate strong cash flow margins (FFO above 12% and
FCF above 5%) while gradually de-leveraging and growing its
business organically.

Final ratings are subject to the completion of the bank loan issue
in line with the terms already reviewed and receipt of final
documentation.

KEY RATING DRIVERS

Modest Size and Strategic Position: Cobham has a moderate strategic
position in the sector due to it being a mid-sized tier 2 / 3
supplier with a relatively low kit value on most programmes it
participates in. Typically, Cobham's contracts are fixed price with
limited input into the broader structure of a programme (pricing,
timing, development work). Offsetting this are the company's
positions in large key programmes and the high tech nature of its
products and services, which serve as barriers to entry, especially
in the short term.

Diversified Programme Participation: Cobham benefits from good
revenue diversification between defense and commercial activities
and a broad geographical split. The company demonstrates
well-diversified platform participation across various defense and
commercial segments, some of which are high profile and key to the
industry. Customer diversification also appears strong.

Favourable Market Dynamics: Fitch considers the US budget
environment to be favourable, with a proposed allocation for
procurement and research, development, test & evaluation (RDT&E) -
the best gauge for defense contractors - in the 2020 request up 2%
from the enacted fiscal 2019 budget. Fitch believes large,
diversified prime contractors and their suppliers are well
positioned over the long term. The current global commercial
aerospace environment is also generally positive, with output of
large commercial aircraft expected to grow in 2020, although Fitch
sees reasons to be cautious beyond 2020, as the impact of fuel and
foreign currency on airline profits; rising trade tensions;
imbalances throughout the airline industry (traffic, profits, etc.)
and the credit quality of some airlines may affect demand for
aircraft.

Strong Cash Generation: Cobham displays solid cash flow generation,
with FFO to revenue of around 11% and FCF to revenue of around 5%
expected by Fitch in 2019. Fitch expects these ratios to remain
broadly stable over the short to medium term, although there is
potential for margin improvement via cost reduction or elimination
measures to be undertaken by the new owner as well as possible
benefits from organic growth derived from market dynamics.

Highly Leveraged Capital Structure Caps Rating: Fitch expects
Cobham to show both gross and net leverage of around 7x at
end-2019, with those ratios improving to comfortably under 6x and
5x, respectively, by end-2022. This is broadly in line with the 'B'
rating for the Aerospace and Defence sector but the ratings of the
company are constrained to within the 'B' category by the capital
structure.

Advent Ownership Could Spur Growth: Advent's ownership of Cobham
could also improve the company's access to a greater share of the
US defense budget via the elimination of the SSA-related
restrictions. Further opportunities to improve Cobham's
profitability in the short to medium term are driven by high
defense spending globally but especially in the US, the maturity of
certain key programmes, such as the KC-46 and the F35, cost
reduction initiatives from the elimination of plc & SSA costs, and
operational improvement through procurement, lean manufacturing,
operating leverage and reduction of general expenses.

DERIVATION SUMMARY

Cobham displays a cash flow profile similar to other technology
industrial companies such as Sequa Corporation (B-/Stable), The
NORDAM group (B/Stable), Sensata Technologies or aerospace and
defence contractors such as MTU Aero Engines (BBB/Stable) with high
double digit EBITDA margins and positive free cash flows. A key
differentiating rating factor is leverage, which is lower at MTU
and NORDAM than Cobham's proposed level at closing and is the chief
reason for the differences in the ratings. The business profiles of
these names are varied and do not serve as key rating
differentiating issues; but are often characterised by the same
positive factors such as good positions in niche markets, strong
relationships with customers and moderate diversification.

KEY ASSUMPTIONS

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

  - Revenue to grow at modest 2-3% per year, mostly in line with
the sector growth

  - EBITDA margin between 17-18% over the rating horizon, a
reduction from 18.5% in FY18

  - No M&A activity or dividend payments over the rating horizon

  - Capex expenditure at around 4% annually

Key recovery rating assumptions:

  - The recovery analysis assumes a going concern scenario

  - A 10% administrative claim

  - The going concern approach estimate of USD1.44 billion reflects
Fitch's view of the value of the company that can be realised in a
reorganisation and distributed to creditors

  - These assumptions result in a recovery rate for the prospective
bond within the 'RR3' range to generate a one-notch uplift to the
debt rating from the IDR.

RATING SENSITIVITIES

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

  - Improvement in the business profile such as a more prominent
participation in key programmes

  - FFO gross leverage sustainably below 5x

  - FCF margin above 5%

  - FFO fixed charge cover above 3x

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

  - Further material cost overruns on key programmes

  - FFO gross leverage above 6.5x beyond 2020

  - Negative FCF margin on a sustained basis

  - FFO fixed charge cover below 2x

LIQUIDITY AND DEBT STRUCTURE

Strong Liquidity: Post-transaction closing, which will see all of
the existing debt refinanced with long-term secured loans, the
company is expected to show strong liquidity, with ample cash
reserves and sustainably high FCF sufficient to cover any
short-term working capital needs.

SUMMARY OF FINANCIAL ADJUSTMENTS

2% of year-end reported cash is treated as non-available for
intra-year working capital and operational needs

ESG CONSIDERATIONS

Unless otherwise disclosed in this section, the highest level of
ESG credit relevance is a score of '3'. This means ESG issues are
credit-neutral or have only a minimal credit impact on the entity,
either due to their nature or to the way in which they are being
managed by the entity.


AI CONVOY: Moody's Assigns B2 Corp. Family Rating, Outlook Stable
-----------------------------------------------------------------
Moody's Investors Service assigned a B2 Corporate Family Rating and
B2-PD Probability of Default Rating to AI Convoy (Luxembourg)
S.a.r.l., a holding company formed to effect the acquisition of
Cobham Plc by funds managed by Advent International. Cobham is a
provider of equipment, specialized systems and components for the
aerospace, defence, energy, and electronics industries.

Concurrently Moody's has assigned B1 ratings to the senior secured
first lien term loan B due 2027, split into a $788 million and a
EUR885 million tranches, and the $350 million equivalent senior
secured first lien revolving credit facility due 2025 issued by AI
Convoy (Luxembourg) S.a.r.l. The outlook on the company is stable.

The proceeds of the debt financing, alongside new equity, will be
used to finance of the acquisition of Cobham, refinance existing
debt for working capital and pay transaction fees and expenses. The
transaction closed on January 17, 2020 and Cobham Plc was delisted
on January 20, 2020.

The rating action reflects:

  -- A high opening leverage of 7.6x (6.7x removing corporate costs
of GBP45 million, including costs associated with being listed of
GBP19 million and function cost savings of GBP23 million) on a
Moody's-adjusted basis, with expectations of gradual de-leveraging
and positive free cash flow generation over the next 12-18 months

  -- The early stage of the company's recovery after operating and
financial challenges in recent years

  -- The company's entrenched positions on key defence and
commercial platforms and good platform diversification

RATINGS RATIONALE

The B2 CFR reflects Cobham's key role and entrenched positions in
multiple defence and commercial aerospace programmes that are
strategic for large Original Equipment Manufacturers (OEMs) and
their clients, including the US Department of Defense (DoD). The
company has specialist capabilities and know-how in defence
electronics, air-to-air refueling, life support and mission
pneumatic systems, aviation services, video and data
communications, including satellite communications, and audio.
Cobham is a leading provider of aerial refueling technology used on
most western fast jets and a key supplier of components for the
F-35 fighter and to the US military's electronic warfare and radar
capability.

The company generates around two-thirds of its revenues from the
defence/security industry and around a third from civil aviation, a
mix that should result in only moderate revenue cyclicality, in
Moody's view. Geographically, over half of group revenues are
generated from the US, by far the largest defence market globally,
with the remaining half split across the UK, the European Union,
South Korea and Singapore.

Cobham benefits from good diversification across multiple defence
and commercial aircraft platforms, which underpins relatively
stable revenue generation. The top 10 platforms represented around
half of revenues in 2018, with no single contract representing more
than 5%. Moody's estimates that two of the largest platforms - the
F-35 and the KC-46 each represented less than 5% of group revenues
last year. Also, most platforms are transitioning from lower margin
development to higher profitability production phases, which should
result in revenue and margin growth without the need for new
contract wins.

The company has had execution issues on key platforms in recent
years, although Moody's sees clear indications that this is now
mostly behind it. Despite some tail risk on the key KC-46 programme
with Boeing Company (The) (A3, Rating Under Review), certain
significant platforms are in an advanced stage of their life cycle,
underpinning the visibility of future revenues and providing some
aftermarket potential in the long term. Excluding the KC-46
settlement, organic growth was +3% in 2018 and +11% in H1 2019,
after negative growth in four out of the last five years.

The KC-46 programme has been challenging for both Cobham and Boeing
and is now over two years late compared to the original schedule.
The scope of Cobham's work on the platform is relatively limited -
representing around 3%-4% of the total programme value, but its
role is critical as it provides the key systems - the centreline
drogue system (CDS), wing aerial refueling pods (WARPS) and body
fuel tanks - that allow the aircraft to fulfil its designated
refueling mission. Cobham has sole source status for a majority of
the systems it provides and is the market leader in aerial
refueling. In Moody's opinion, following GBP200 million provisions
made by Cobham over the last two years, the KC-46 is likely to be
largely de-risked, and should therefore provide good visibility in
terms of original equipment revenues and aftermarket potential.

The company's reliance on relationships with OEMs remains a risk,
which could be adversely affected by weak execution on existing and
future programmes. The remaining major issue on the KC-46 is the
qualification of the wing pods which is expected by the middle of
2020 and may require further charges if the certification costs are
higher than budgeted. However, Moody's believe that any potential
further charge is likely to be limited.

The rating also reflects the company's initially high leverage
levels and its relatively small scale compared to the challenges
and complexity typical of the defence and commercial aerospace
industries. Although leverage is high, Moody's expects significant
and rapid deleveraging over the next two years driven by EBITDA
growth.

Moody's does not view Cobham's corporate structure as a major
governance risk factor as the company has a history of complying
with financial, legal and regulatory requirements in its operating
jurisdictions. However, governance risks that Moody's considers in
Cobham's credit profile include: i) financial policies which are
likely to maintain relatively high leverage and ii) reliance on key
individuals to maintain strong OEM relationships and manage new
contracts. Moody's would expect appropriate management incentives
in place under an LBO to retain key staff. The OEM relationships
are according to the company spread across the wider management
team.

LIQUIDITY

Moody's considers Cobham's liquidity profile to be adequate,
supported by the undrawn $350 million equivalent senior secured
first lien revolving credit facility (RCF). The company is expected
to generate positive free cash flow after debt service costs on an
annual basis, particularly after planned restructuring expenses in
2020 will decrease.

STRUCTURAL CONSIDERATIONS

The group's debt facilities will include GBP1.7 billion equivalent
first lien debt, due 2027 including a $788 million USD tranche and
a EUR885 million EUR tranche term loan B as well as $400 million
other senior secured debt (unrated); a pari passu ranking $350
million revolving credit facility due 2025; and a $672 million
second lien term loan due 2028 (pre-placed and not rated). The
facilities are guaranteed by AI Convoy (Luxembourg) S.a.r.l. and by
all its material restricted subsidiaries and secured over all US
and floating charges in the UK, France and Singapore and share
security provided in all other jurisdictions. The second lien is
contractually subordinated to the first lien facilities through the
intercreditor agreement. The B1 rating on the first lien term loan
and RCF is one notch above the CFR, reflects their seniority in the
capital structure.

OUTLOOK

The stable outlook reflects Moody's expectations that Cobham will
reduce Moody's-adjusted leverage to below 6.0x over the next 12-18
months, reflecting the ongoing normalisation of the company's
operating performance. In addition, the stable outlook factors in
increasing revenues and EBITDA, driven by improved execution on
existing programmes and planned cost savings and margin improvement
measures. It also assumes that positive free cash flow, adequate
liquidity and the absence of major contractual disputes.

WHAT WOULD CHANGE THE RATINGS UP / DOWN

The ratings could be upgraded if Moody's-adjusted leverage reduces
sustainably below 5x. It would also require material positive free
cash flow to materialize, with free cash flow to debt improving
towards 10%. An upgrade would also require meaningful like-for-like
revenue and EBITDA growth, the absence of major execution
challenges on key platforms, and adequate liquidity.

The ratings could be downgraded if the company fails to delever to
around 6x on a Moody's-adjusted basis over the next 12-18 months,
or if the company generates negative free cash flow. A downgrade
could ensue also in case of material execution issues on key
platforms, or if liquidity concerns arise.

PRINCIPAL METHODOLOGY

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

COMPANY PROFILE

Founded in 1934, Cobham designs and manufactures a wide range of
equipment, specialized systems and components for the aerospace,
defence, energy, and electronics industries. The group owns six
facilities in the US and the UK. The company's operations are split
across four divisions: i) Advanced Electronic Solutions,
representing 32% of revenues in 2018, ii) Mission Systems,
including the aerial refueling operations, representing 22% of
revenues, iii) Communications & Connectivity, representing 29% of
revenues, and iv) Aviation Services, representing 17% of revenues.
In 2018 Cobham reported revenues of GBP1,863.3 million and had
around 10,000 employees.


AI CONVOY: S&P Assigns Preliminary 'B' ICR, Outlook Stable
----------------------------------------------------------
S&P Global Ratings assigned its preliminary 'B' long-term issuer
credit and issue ratings to U.K.-based and Luxembourg-incorporated
AI Convoy (Luxembourg) S.a.r.l. (Cobham) and its first-lien debt.
The recovery rating on the first-lien debt is '3'.

S&P said, "The final ratings will depend on our receipt and
satisfactory review of all the final transaction documentation.
Accordingly, the preliminary ratings should not be construed as
evidence of the final ratings. If S&P Global Ratings does not
receive the final documentation within a reasonable time frame, or
if the final documentation departs from the materials reviewed, we
reserve the right to withdraw or revise our ratings." Potential
changes include, but are not limited to, utilization of loan
proceeds, maturity, size and conditions of the loans, financial and
other covenants, security, and ranking.

The acquisition of Cobham by U.S.-based financial sponsor Advent
will result in a highly leveraged capital structure, but will help
Cobham to bid for U.S. contracts from which it would historically
have been excluded.  AI Convoy (Luxembourg) S.a.r.l (Cobham) is
being acquired by private-equity firm Advent and raising $2.847
billion of new term debt as part of the transaction. This debt will
comprise a $350 million revolving credit facility (RCF), $2.175
billion of first-lien debt (comprising an EUR885 million
euro-denominated first-lien term loan B and a $1.188 billion
U.S.-dollar-denominated tranche of first-lien debt), and a $672
million U.S.-dollar-denominated second-lien loan. S&P said, "We
also note the presence in the group structure of $690 million
equivalent sterling denominated payment-in-kind (PIK) preference
shares held by minority co-investor Blackstone (that we view as
debt-like) and $1.025 billion of interest-free preferred equity
certificates (IFPECs) held by Advent and Blackstone (that we also
view as debt-like)."

Post transaction, S&P Global Ratings-adjusted leverage for
full-year 2020 is forecast to be about 10x including the $690
million equivalent sterling-denominated preference shares and
GBP1.025 billion IFPECs, and about 6.5x excluding them, making
Cobham one of the more highly leveraged issuers in the Europe,
Middle East, and Africa aerospace and defense portfolio. However,
we forecast that the company will exhibit adjusted margins of about
18%, and robust free operating cash flow (FOCF) generation, with
good cash interest coverage and ample liquidity, especially
including the fully available new RCF.

The majority of Cobham's sales are to major commercial aviation
companies (36% of 2018 revenue), U.S. defense/security firms (38%),
and U.K./rest of the world defense/security (26%) firms. Cobham is
present on many of the large household name defense and commercial
aviation platforms (providing good product and service diversity).
S&P said, "Therefore, we consider Cobham to benefit from exposure
to end markets that are exhibiting robust demand and growth
prospects, coupled with good contract visibility and longevity. In
our view, Cobham is a leading incumbent in its core air-to-air,
oxygen supply, and other mission critical businesses, with a strong
advantage and market position having produced sought-after
equipment for decades. We view barriers to entry as high once
Cobham is on a platform/has already won a contract. This is the
case across most divisions and especially on sole source programs,
for example air-to-air refueling. Product development can take up
to five years on average for design and certification. Therefore,
given the high qualification costs, switching entrenched suppliers
is expensive and unappealing to many prime firms. Cobham's
acquisition by a U.S.-based owner will likely help it to bid for
U.S. defense contracts from which it may have been excluded in the
past. However, at this stage, we do not include material upside
from this potential opportunity in our forecasts."

Cobham exhibits high geographic concentration and a recent history
of volatile profitability (versus peers), but operational
challenges seem to be consigned to the past and are fully
provisioned for going forward.  S&P considers Cobham's position as
a Tier 2/3 supplier, with high geographic concentration and a
recent history of volatile profitability (versus many rated peers)
an anchor to the fair business risk profile. Despite producing and
distributing in many countries and regions around the globe, nearly
52% of group revenue is generated in the U.S, which together with
the U.K. and Australia accounts for nearly three-quarters of sales.
Overall, group revenue has not increased significantly over the
past decade (full-year 2009 revenue was GBP1.88 billion versus
full-year 2019 expected revenue of GBP2.05 billion). This reflects
a period of opportunistic but not entirely successful mergers and
acquisitions (M&A) and disposals, including the challenging
acquisition and integration of Aeroflex in 2014. This acquisition
and integration was followed by certification problems and late
deliveries for equipment supplied to the Boeing KC-46 Tanker
program from 2016 through 2018, on which Cobham is the sole source
supplier for the hose and drogue refueling system, wing pods, fuel
tanks, and communications equipment. Cobham booked a GBP150 million
provision in 2016 and a further GBP200 million provision in 2018
relating to this program.

These operational challenges and unexpected costs have seen
Cobham's profitability fluctuate greatly in the past few years when
compared with its rated peers. Although a costly experience, we
understand that the difficulties with the KC-46 contract are now
largely over, with the certification of primary systems complete
and the first delivery accepted by the U.S. Department of Defense
in late 2018. The project is entering full production and, as it
does, contract-related margins are expected to increase. S&P said,
"We anticipate that the related provisions will unwind over 2019
and 2020 and be complete by 2021. We include the expected cash
outflows relating to this provision unwind in our forecasts, along
with the scheduled controlled foreign corporation (CFC) tax
settlement payment(s)."

S&P said, "We consider Cobham to be relatively well insulated from
the well-documented geopolitical and major platform risks that some
rated peers are facing.  Specifically, a potentially disruptive
U.K. exit from the EU (Brexit), the ongoing U.S.-China trade war,
and the grounding of the Boeing 737 MAX passenger plane. Although
Cobham has production facilities, suppliers, and customers in the
U.K. and Europe, we see a potential no-deal Brexit as having a
minimal effect on the business versus some rated peers. Most of the
company's business is local and there is very little cross-border
flow of goods or services between the U.K. and EU, with about $100
million of revenue affected in a potential disruptive Brexit.
Cobham is carrying an additional $10 million-$15 million of buffer
stock to smooth potential supply chain disruption. We also note
that Cobham has very little exposure to the 737 MAX, nor does its
business plan rely on this particular aircraft.

"We assess Cobham as a financial sponsor-related entity given its
ownership by Advent and Blackstone, following the acquisition.
Co-investor Blackstone will participate in several tranches of
Cobham's debt, holding all of the $690 million equivalent
sterling-denominated preference shares, half of the second-lien,
and potentially a tranche of the first-lien. Although an equity
sponsor's participation in the debt indicates its strong commitment
toward the investment, it could also present unforeseen obstacles
to other lenders if Cobham were in a distressed situation. We also
note that there are no transfer restrictions (to third parties of
the preference shares or IFPECS). We therefore treat these
instruments as debt. When calculating adjusted debt, we consider
Cobham's new debt facilities and then adjust for operating leases,
pension-related obligations, and the preference shares and IFPECS.
We apply a 100% cash haircut and also consider that Cobham may
follow a shareholder-friendly dividend policy.

"We assess Cobham's management and governance as fair, reflecting
its clear strategic planning process and good depth and breadth of
management. However, Cobham is being delisted from the London Stock
Exchange and taken private under new ownership by a private-equity
sponsor. Management will need to steer the business through a
period of transformation under the new ownership, establishing a
new track record in the process.

"The stable outlook reflects our expectation that Cobham will
continue to deliver on its business strategy, increasing its
revenue and sustaining profitability. We expect that Cobham will
maintain adjusted EBITDA margins of 18% or more in 2019 and 2020,
but that adjusted debt to EBITDA will remain about 10x including
preference share instruments (that we treat as debt) or about 6.5x
excluding them. We expect Cobham to exhibit robust FOCF generation
and funds from operations (FFO) cash interest coverage of more than
2.5x over our 12-month rating horizon."

Downside scenario

S&P said, "We could lower the rating on Cobham if FFO cash interest
coverage decreases to below 2.5x because of operational setbacks or
a debt-financed financial policy or acquisitions. We could also
take a negative rating action if adjusted FOCF were to materially
weaken, because in our view this would lead to an unsustainable
capital structure. We could also lower the rating if the ratio of
liquidity sources to uses were to decrease to less than 1.2x."

Upside scenario

S&P said, "We consider a positive rating action to be unlikely at
this stage, but we could raise the rating if Cobham were to improve
debt to EBITDA to sustainably below 5x (excluding the shareholder
loans), supported by positive industry trends and robust operating
performance."



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

ADRIA MIDCO: Moody's Confirms B2 CFR & Alters Outlook to Stable
---------------------------------------------------------------
Moody's Investors Service confirmed Adria Midco B.V.'s B2 corporate
family and B2-PD probability of default rating. Concurrently,
Moody's has assigned a B2 rating to the proposed EUR1.05 billion
Fixed and Floating Senior Secured Notes due 2026 and the EUR575
million Fixed Rate Senior Secured Notes due 2028 to be issued by
its wholly owned subsidiary United Group B.V.. The rating agency
has also confirmed the B2 rating on the company's existing EUR1.65
billion Senior Secured Notes (due 2022, 2024 and 2025) issued by
UG. The outlook is stable.

The rating action concludes the review for downgrade initiated on
November 13, 2019, following the announcement of Adria's proposed
acquisition of Bulgarian Telecommunications Company EAD for a total
consideration of EUR1.2 billion. Most of the proceeds from the
EUR1.05 billion new notes will be used to fund the acquisition
together with EUR170 million Pay-If-You-Can Notes due 2025 to be
issued at the holding company, Summer Bidco B.V., outside of the
restricted group defined by the lenders for Adria. The proceeds
from the new EUR575 million FRN's together with cash on hand will
be used to redeem the existing EUR575 million SSN's due 2022.

The transaction is subject to regulatory approval, and closing is
expected in the second quarter of 2020.

"The confirmation of Adria's ratings at B2 reflects the improvement
in scale, geographical and business diversification resulting from
recent acquisitions," says Agustin Alberti, a Moody's Vice
President -- Senior Analyst and lead analyst for Adria.

"While Adria's leverage will increase to around 5.8x in 2020
following the acquisition of Vivacom, we expect the company to
reduce leverage below 5.5x by 2021, supported by sustained revenue
and EBITDA growth prospects," adds Mr. Alberti.

RATINGS RATIONALE

The acquisition of Vivacom will improve Adria's scale and
geographical diversification by adding the former incumbent telecom
operator in Bulgaria to its footprint. Vivacom is the leading
telecom operator in Bulgaria with an estimated 35% revenue market
share and 1.8 million unique customers. It has the largest fiber
network in Bulgaria with 1.7 million homes passed, and a fully
invested 4G national network. It holds leading positions in the
broadband and the fixed telephony markets and is the third operator
in mobile and Pay-TV. Over the last three years, Vivacom has
reported revenues and EBITDA annual average growth rates of 4% and
13%, respectively, due to the increase in RGUs and ARPU, and
supported by a favorable macroeconomic environment in Bulgaria.

Moody's recognizes that the combination will lead to some synergies
due to the increased scale of the group. The sharing of best
practices could be particularly relevant in the Pay-TV segment
through the adoption of Adria's best-in-class Pay TV platform,
"Eon" and a reinvigorated cross-selling strategy. However, the
acquisition will also lead to some execution risks in the
integration of Vivacom, as Adria is entering a new market where it
did not have any presence before and acquiring an integrated
incumbent operator, with a different technology and market
positioning to its existing core cable operations in the CEE
region.

The rating agency highlights some uncertainty around the deal as V2
Investment S.a.r.l. ('V2'), the former owner of Vivacom, has issued
legal proceedings against UG in the District Court of Luxembourg in
connection with the proposed acquisition of Vivacom. V2 is trying
to reverse the 2015 acquisition of Vivacom from current owners with
ongoing legal proceedings in several jurisdictions.

If the transaction closes successfully, Moody's estimates that pro
forma revenue for the combined group (including the recent
acquisition of Tele2 Croatia) would be around EUR1.5 billion in
2020 (compared to around EUR800 million prior to these
transactions). Vivacom and Tele2 Croatia will represent around 32%
and 13% of total revenues of the combined group, respectively.

The Bulgarian and Croatian currencies are pegged to the euro, and
both acquisitions will allow the company to reduce exposure to the
Serbian dinar, which will account for 15% of total revenues
compared to 27% prior to the transaction.

Moody's expects Adria's organic revenue and EBITDA growth to remain
solid in the mid-single digits, driven by overall RGUs and ARPU
increases, and savings from efficiency measures. However, free cash
flow generation will remain negative in 2020 and 2021 because of
high capital spending (estimated around 23% annual capex over
sales), the recurrent dividend outflows to service the EUR476
million PIK notes' interests at the Summer Bidco B.V. level (around
EUR43 million per year), and significant cash outflows from
expected spectrum auctions in Bulgaria, Croatia and Slovenia.

Moody's estimates that the leverage ratio will increase to 5.8x
(Moody's adjusted gross debt to EBITDA on a pro forma basis) in
2020 compared to 5.3x prior to both acquisitions, reducing to 5.3x
in the next 18-24 months, below the 5.5x maximum leverage threshold
for the B2 rating and absent further debt financed acquisitions.

Governance considerations, which Moody's takes into account in
assessing Adria's credit quality, relate to the management proven
track record with the company consistently growing revenues and
EBITDA and successfully integrating past acquisitions. The
management's c.39% equity ownership and, therefore, its commitment
to the strategy of the company is credit positive. However, the
company is tightly controlled by funds managed by BC Partners which
controls the board with a c.52% equity stake, while KKR and EBRD
hold the remaining 7% and 2% stake, respectively. As is often the
case in highly levered, private equity sponsored deals, owners have
a high tolerance for leverage/risk and governance is comparatively
less transparent. Additionally, the rating agency highlights a
somewhat aggressive liquidity management with high reliance on its
RCF.

LIQUIDITY

At transaction closing, the company will have cash and cash
equivalents of around EUR56 million. Moody's assessment of adequate
liquidity factors in the company's intention to increase its super
senior RCF due 2025 to EUR250 million from EUR200 million, of which
EUR63 million are drawn, together with the existing EUR100 million
of local bilateral lines, of which EUR27 million are drawn. The
company will not have any material maturities until 2024 when the
fixed rate notes mature. The super senior RCF contains one
leverage-based maintenance covenant of 9.5x Net Debt to
Consolidated EBITDA tested on a quarterly basis.

STRUCTURAL CONSIDERATIONS

Adria is the top company of the restricted group and the reporting
entity for the consolidated group. Its subsidiary UG is the issuer
of the rated notes and also one of the original borrowers under the
company's EUR250 million SSRCF. The unrated SSRCF ranks ahead in an
enforcement scenario. It shares a guarantee and security package
with the rated senior secured notes. In addition, the SSRCF (but
not the senior secured notes) is secured on Serbian assets and
receives guarantees from Serbian subsidiaries. Consequently, the
SSRCF ranks first and the senior secured notes second in the
waterfall of claims, together with the local bilateral lines of
EUR100 million in aggregate and Adria's trade payables. Given the
limited weight of the SSRCF ranking ahead of the senior secured
notes, the notes are rated B2, at the same level as the CFR.

RATIONALE FOR STABLE OUTLOOK

The company is initially weakly positioned in the B2 category, with
initial leverage of 5.8x by 2020. The stable outlook reflects
Moody's expectation that the company will successfully integrate
recent acquisitions and reduce leverage below 5.5x in 2020,
supported by its sound operating performance with strong revenue
and EBITDA organic growth.

WHAT COULD CHANGE THE RATINGS UP/DOWN

Downward pressure may arise if leverage is not managed so that its
gross Debt/EBITDA ratio (Moody's definition) is maintained well
above 5.5x on a sustained basis. Downward rating pressure could
also arise if the company's liquidity profile deteriorates.

Conversely, upward pressure may arise if the company reduces its
leverage so that its gross Debt/EBITDA ratio (Moody's definition)
falls well below 4.5x and demonstrates its capacity to generate
adjusted positive FCF/debt (Moody's definition) on a sustainable
basis. However, the PIK instrument outside of the restricted group
represents an overhang for Adria, as it could be refinanced within
the restricted group once sufficient financial flexibility
develops. Therefore, the PIK instrument could be a constraint to
upward rating pressure in the future.

LIST OF AFFECTED RATINGS

Issuer: Adria Midco B.V.

Confirmations:

Probability of Default Rating, Confirmed at B2-PD

Corporate Family Rating, Confirmed at B2

Outlook Action:

Outlook, Changed To Stable From Ratings Under Review

Issuer: United Group B.V.

Assignment:

Backed Senior Secured Regular Bond/Debenture, Assigned B2

Confirmation:

Backed Senior Secured Regular Bond/Debenture, Confirmed at B2

Outlook Action:

Outlook, Changed To Stable From Ratings Under Review

PRINCIPAL METHODOLOGY

The principal methodology used in these ratings was
Telecommunications Service Providers published in January 2017.

Moody's has changed the methodology used in rating Adria to
Telecommunications Service Providers from Global Pay TV-Cable and
Direct-to-Home Satellite Operators because, following the
acquisitions of Vivacom and Tele2 Croatia, there is a change in
business mix, with more than 50% of revenues and profits generated
by telecommunication businesses.

COMPANY PROFILE

Adria Midco B.V. provides, through its subsidiary United Group
B.V., cable and satellite pay-TV, broadband and telephony in
Slovenia, Serbia and Bosnia and Herzegovina, mobile services in
Slovenia, satellite pay-TV across the six countries of former
Yugoslavia, Slovenia, Serbia, Bosnia and Herzegovina, Croatia,
Macedonia and Montenegro and OTT services worldwide. In the last 12
months ending September 2019, the company reported revenues of
EUR737 million and Adjusted EBITDA of EUR289 million.




=========
S P A I N
=========

DIA GROUP: Spanish Magistrate Launches Criminal Investigation
-------------------------------------------------------------
Clara-Laeila Laudette and Tomas Cobos at Reuters report that a
Spanish magistrate has launched a criminal investigation into
suspected account-fiddling at retailer Dia under its previous
management, before Russian oligarch Mikhail Fridman took over the
near-insolvent company last year.

Magistrate Alejandro Abascal said in court documents seen by
Reuters that he was looking into whether the company's management,
including then-CEO Ricardo Curras, manipulated Dia's pre-tax
earnings data in 2017 to make it falsely appear the company had
reached financial targets, Reuters relates.

According to Reuters, the plan, which court documents allege Curras
had masterminded in order to justify his annual bonus, saw Dia's
2017 EBITDA inflated by over EUR51 million (US$57 million).

Abascal will summon Mr. Curras, alongside former Dia senior
executives and an external auditor from consultancy firm KPMG, to
appear in court, Reuters discloses.

The criminal investigation stemmed from an incident last May, when
Dia shareholders questioned the veracity of the company's 2017
accounts, Reuters recounts.

The accounts had been revised in October 2018, sending Dia's share
price down to historic lows they have yet to recover from, Reuters
states.

At the time, Dia's financial situation deteriorated as it struggled
to keep up with rising competition from other supermarket chains,
and in 2019, Mr. Fridman snatched the company back from the brink
of insolvency, Reuters notes.

In October, Spain's Supreme Court told the High Court to
investigate allegations that Fridman had acted to depress the share
price of DIA when trying to take control of the supermarket chain,
Reuters relays.  Mr. Fridman has denied wrongdoing, according to
Reuters.


FTPYME TDA CAM 4: S&P Affirms 'D(sf)' Rating on Class D Notes
-------------------------------------------------------------
S&P Global Ratings raised its credit ratings on FTPYME TDA CAM 4,
Fondo de Titulizacion de Activos' class B and C notes. At the same
time, S&P has affirmed its rating on the class D notes.

Credit analysis

S&P said, "We have applied our European small and midsize
enterprise (SME) CLO criteria to determine the scenario default
rates (SDRs)--the minimum level of portfolio defaults that we
expect each tranche to be able to withstand at a specific rating
level using CDO Evaluator.

"We ranked the originator into the moderate category. Taking into
account Spain's banking industry country risk assessment (BICRA)
score of 4, we have applied a downward adjustment of one notch to
the 'b+' archetypical average credit quality. Due to the absence of
information on the creditworthiness of the securitized portfolio
compared with the originator's entire loan book, we further
adjusted the average credit quality by three notches.

"As a result of these adjustments, our average credit quality
assessment of the portfolio was 'ccc', which we used to generate
our 'AAA' SDR of 83%.

"We have calculated the 'B' SDR, based primarily on our analysis of
historical SME performance data and our projections of the
transaction's future performance. We have reviewed the portfolio's
historical default data, and assessed market developments,
macroeconomic factors, changes in country risk, and the way these
factors are likely to affect the loan portfolio's creditworthiness.
As a result of this analysis, our 'B' SDR is 10%.

"We interpolated the SDRs for rating levels between 'B' and 'AAA'
in accordance with our European SME CLO criteria."

Cash flow analysis

S&P said, "At each liability rating level, we applied a
weighted-average recovery rate (WARR) by considering observed
historical recoveries. As a result of this analysis, our WARR
assumptions in a 'B' scenario is 40%.

"We used the portfolio balance that the servicer considered to be
performing, the current weighted-average spread, and the above
weighted-average recovery rates. We subjected the capital structure
to various cash flow stress scenarios, incorporating different
default patterns and interest rate curves, to determine the rating
level, based on the available credit enhancement for each class of
notes under our European SME CLO criteria."

Country risk

S&P said, "Under our structured finance sovereign risk criteria,
the class B notes can be rated up to six notches above the
unsolicited long-term rating on Spain.

"Since our previous review, the class A2 and A3(CA) have fully
amortized. As a result, the credit enhancement for the class B
notes increased to 65.9% from 40.1%. In addition, the class B notes
have become less vulnerable to liquidity risk. Considering the
results of our credit and cash flow analysis and the application of
our sovereign risk criteria, we have raised to 'AA+ (sf)' from 'BB-
(sf)' our rating on the class B notes.

"Since our previous review, the credit enhancement of the class C
notes has increased to 17.6% from 5.9%. In our opinion, the class C
notes are no longer vulnerable to nonpayment, or dependent upon
favorable business, financial, and economic conditions. Therefore,
following the application of our 'CCC' ratings criteria, we have
raised to 'B- (sf)' from 'CCC- (sf)' our rating on the class C
notes.

"We have affirmed our 'D (sf)' rating on the class D notes as they
continue to miss their interest payments."

FTPYME TDA CAM 4 is a single-jurisdiction cash flow CLO transaction
securitizing a portfolio of SME loans that BANCO CAM S.A.U.
originated in Spain. The transaction closed in December 2006.


IM SABADELL PYME 11: Moody's Hikes EUR332.5MM Class B Notes to B2
-----------------------------------------------------------------
Moody's Investors Service upgraded the ratings of Class B notes and
affirmed the ratings of Class A notes in IM SABADELL PYME 11, FONDO
DE TITULIZACION. The rating action reflects the increased levels of
credit enhancement for the affected notes.

  EUR1567.5M (current outstanding amount EUR478.7M) Class A Notes,
  Affirmed Aa3 (sf); previously on Mar 25, 2019 Affirmed Aa3 (sf)

  EUR332.5M Class B Notes, Upgraded to B2 (sf); previously on
  Mar 25, 2019 Upgraded to Caa2 (sf)

IM SABADELL PYME 11, FONDO DE TITULIZACION is an ABS backed by
small to medium sized enterprises loans located in Spain. The deal
was originated by Banco Sabadell, S.A. (Baa2/P2).

RATINGS RATIONALE

The rating action is prompted by an increase in credit enhancement
for the affected tranches.

Credit Enhancement for Class A notes has increased to 52.3% from
33.6% since the last rating action taken on this deal in March
2019. Class B notes CE has increased during the same period to
11.3% from 7.3%.

Revision of Key Collateral Assumptions

As part of the rating action, Moody's reassessed its default
probability and recovery rate assumptions for the portfolio
reflecting the collateral performance to date.

The performance of the transactions has slightly deteriorated over
the last year. Total delinquencies have increased in the past year,
with 90 days plus arrears currently standing at 1.57% of current
pool balance. Cumulative defaults currently stand at 2.05% of
original pool balance up from 0.35% a year earlier.

Moody's maintained its default probability on current balance and
recovery rate assumptions, as well as portfolio credit enhancement,
due to observed pool performance in line with expectations.

Counterparty Exposure

The rating actions took into consideration the notes' exposure to
relevant counterparties, such as servicer, account banks or swap
providers.

Moody's considered how the liquidity available in the transactions
and other mitigants support continuity of note payments, in case of
servicer default, using the CR assessment as a reference point for
servicers.

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

IM SABADELL PYME 11, FONDO DE TITULIZACION is not exposed to any
swap counterparty.

Principal Methodology

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) an increase in available
credit enhancement and (3) improvements in the credit quality of
the transaction counterparties and (4) a decrease in sovereign
risk.

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




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

ARCADIA GROUP: To Close Additional 10 UK Stores in Coming Months
----------------------------------------------------------------
Grace Whelan at Drapers reports that Arcadia Group is to close 10
further stores across the UK in the coming three months.

The closures are a result of lease expiries, and are separate from
the retail group's ongoing company voluntary arrangement, Drapers
understands.

According to Drapers, all but three of the stores to close are
Topshop Topman branches. They comprise Wolverhampton, Newbury,
Blackburn, Bolton, Aylesbury, Horsham, and Blackpool.

The remaining three are Worthing's Dorothy Perkins and Burton shop,
Carmarthen's Topshop Topman and Miss Selfridge store, and Ipswich's
Dorothy Perkins and Burton fascia, Drapers notes.

As part of the CVAs, 23 stores closed across the UK and Ireland,
Topshop and Topman's retail operations in the US were placed into
administration, and rents were slashed across the remainder of the
portfolio, Drapers discloses.  Alongside the CVAs, Arcadia planned
to put two subsidiaries into administration, resulting in a further
expected 25 store closures, Drapers relates.

                        About Arcadia Group

Arcadia Group Ltd. is the UK's largest privately owned fashion
retailer with seven major high street brands: Burton, Dorothy
Perkins, Evans, Miss Selfridge, Topshop, Topman and Wallis, along
with its out-of-town fashion destination Outfit.  

In June 2019, Arcadia's creditors approved a Company Voluntary
Arrangement (CVA).  The company's landlords agreed to rent cuts, 23
store closures and 520 job losses.


DELPHI TECHNOLOGIES: Moody's Lowers CFR to B1, Outlook Neg.
-----------------------------------------------------------
Moody's Investors Service downgraded Delphi Technologies PLC's
ratings, including Corporate Family Rating and Probability of
Default Rating to B1 and B1-PD, from Ba3 and Ba3-PD, respectively;
and senior unsecured note rating to B2 from B1. The Speculative
Grade Liquidity Rating remains unchanged at SGL-3. The rating
outlook remains negative.

The following actions were taken on Delphi Technologies PLC:

Ratings downgraded:

  Corporate Family Rating, to B1 from Ba3;

  Probability of Default Rating, to B1-PD from Ba3-PD;

  $800 million senior unsecured notes due 2025, to
  B2 (LGD5) from B1(LGD5).

Rating Outlook: Negative

  The $1.25 billion bank credit facility is not rated by Moody's.

RATINGS RATIONALE

The downgrade of Delphi's debt ratings incorporates the expectation
that debt/EBITDA leverage will remain elevated over
intermediate-term, with lower than historical profitability because
of continued weakening global automotive production. For the fiscal
year-end 2019 Moody's estimates that Delphi's Debt/EBITDA will be
about 5x. The weak market conditions affecting Delphi's product mix
is expected to keep Delphi's debt/EBITDA over 5x through 2020.

Further, Delphi's revenue has contracted more than the market
trends in each of its regions for the quarter ending September 2019
(resulting largely from the company's unfavorable diesel engine
related product mix) and Moody's anticipates that this trend will
likely continue through FYE December 2019, and into the first half
of 2020 at least. Global automotive production declines are also
anticipated through 2020 at least. Moody's expects global
commercial vehicle production declines for 2020 in the low-mid
single digit range (about 25% of revenues), which will negatively
impact Delphi's profits in 2020. North American Class 8 build rates
are anticipated to decline about 30%, but this only represents
approximately 4% of Delphi's revenues, as the company is more
exposed to non-US commercial vehicle markets. $200 million of
restructuring actions were recently announced, yet the positive
impact of these actions, net of costs, is not anticipated to occur
until 2021.

Moody's continues to believe that the internal combustion engine
(ICE) will remain a large part of vehicle production well into this
decade and that Delphi will continue to develop technologies to
improve both ICE and electrified vehicle efficiency. Delphi is
likely to maintain high levels of spending on research &
development, engineering, and maintain high levels of investment in
capital equipment over the intermediate-term to develop products to
meet increasingly stringent regulatory emissions requirements of
company's automotive customer base. Yet, the positive impact of
this opportunity is not expected to offset near-term global
automotive production levels and the company's product mix
headwinds until 2021. Another competitive strength is the company's
diversity in customer exposure with no customer representing more
than 10% of revenues.

The negative rating outlook reflects the risk that a recovery in
global automotive and commercial vehicle production over the
intermediate-term may be challenged by softening global economic
conditions. Demand trends in the company's product mix offerings
are being impacted by shifting consumer preferences in Europe away
from diesel vehicles and the automotive production softness in
China. Europe represented about 46% of Delphi's revenues for the
nine-months ended September 30, 2019, while Asia Pacific
represented 22%.

The majority of Delphi's debt is borrowed in Europe. The B2 senior
unsecured rating reflects Moody's EMEA approach within the Loss
Given Default Methodology, which includes treatment of trade
payables and U.K. pensions as secured amounts with priority over
the senior unsecured debt, based on the expected approach in
reorganization. Although there will be secured debt (the bank
debt), the entities outside of the US are estimated to generate the
vast majority of Delphi's consolidated adjusted EBITDA.
Consequently, the secured debt is expected to be in only a somewhat
more favorable recovery position relative to the unsecured notes
with only a modestly higher relative recovery.

Delphi's SGL-3 Speculative Grade Liquidity Rating anticipates an
adequate liquidity profile through early 2021 reflecting the cash
needs over the coming quarters to fund restructuring programs, the
usual first quarter 2020 seasonal cash out flows, and the scheduled
term loan amortization of approximately $37.5 million this year.
These outflows are balanced by the expected cash flow benefit from
headcount reductions through 2020. Moody's anticipates free cash
flow over the coming year to be in the $60 million range, as the
company's restructuring actions take hold. As of September 30,
2019, cash was $105 million and should benefit from 4th quarter
seasonal cash inflows, typical in the automotive supplier industry.
The $500 million revolving credit facility, maturing in 2022, was
unfunded at September 30, 2019. Yet, Moody's estimates that
negative free cash flow in the coming quarters may drive near-term
usage. The financial covenant under the senior secured facilities
includes a net leverage ratio test under which covenant cushion is
likely to significantly reduce over the coming quarters with
ongoing weak global automotive production and additional
restructuring related expenses.

Delphi's role in the automotive industry exposes the company to
material environmental risks arising from increasing regulations on
carbon emissions. As automotive manufacturers seek to introduce
more electrified powertrains, traditional ICEs will become smaller.
Delphi is addressing this risk through the development of engine
components that support this trend.

Delphi maintains positive governance considerations on debt
repayment policies. Yet, the need to invest in R&D and capital
equipment to support its growth while reducing expenses will likely
delay deleveraging until 2021.

The ratings could be upgraded if Moody's expects Delphi to sustain
EBITA margins in the high single digits range, inclusive of
restructuring charges, with Debt/EBITDA sustained below 4x,
supported by positive free cash flow generation solidly in the
high-teens as percentage of debt annually, and balanced financial
policies, while maintaining an adequate liquidity profile.

The ratings could be downgraded with the expectation of further
deterioration of automotive demand or loss of a major customer, if
EBITA margins are anticipated to be sustained below 4%, or
Debt/EBITDA above 6.0x, or a deterioration in liquidity. Debt
funded acquisitions or large shareholder return actions could also
result a lower outlook or rating.

The principal methodology used in these ratings was Automotive
Supplier Methodology published in January 2020.

Delphi Technologies PLC is a leading global automotive supplier of
engine management systems and aftermarket parts. Components include
advanced fuel injection systems, actuators, valvetrain products,
sensors, electronic control modules and power electronics
technologies. Revenues for the LTM period ending September 30, 2019
were approximately $4.5 billion.


E-MAC PROGRAM 2008-IV: Fitch Affirms B+sf Rating on Class D Debt
----------------------------------------------------------------
Fitch Ratings upgraded two tranches and affirmed 11 tranches of
three Dutch E-MAC RMBS transactions.

RATING ACTIONS

E-MAC Program II B.V. Compartment NL 2008-IV

Class A XS0355816264; LT AAsf Affirmed; previously at AAsf

Class B XS0355816421; LT A-sf Affirmed; previously at A-sf

Class C XS0355816694; LT A-sf Affirmed; previously at A-sf

Class D XS0355816934; LT B+sf Affirmed; previously at B+sf

E-MAC Program B.V. Compartment NL 2006-III

Class A2 XS0274609923; LT Bsf Affirmed;   previously at Bsf

Class B XS0274610855;  LT Bsf Affirmed;   previously at Bsf

Class C XS0274611317;  LT Bsf Affirmed;   previously at Bsf

Class D XS0274611747;  LT CCCsf Affirmed; previously at CCCsf

Class E XS0275099322;  LT CCCsf Affirmed; previously at CCCsf

E-MAC Program III B.V. Compartment NL 2008-I

Class A2 XS0344800957; LT AA+sf Affirmed; previously at AA+sf

Class B XS0344801765;  LT Asf Affirmed;   previously at Asf

Class C XS0344801922;  LT A-sf Upgrade;   previously at BBBsf

Class D XS0344802060;  LT BB-sf Upgrade;  previously at B+sf

TRANSACTION SUMMARY

The E-MAC transactions are seasoned true-sale securitisations of
Dutch residential mortgage loans originated by GMAC-RFC Nederland
B.V. The successor company, CMIS Nederland B.V., is servicer.

KEY RATING DRIVERS

Interest-only Concentration

The interest-only (IO) concentrations in these transactions range
between 78% (2006-III) and 85% (2008-IV) of the outstanding
portfolio and are high compared with other Dutch RMBS'. Fitch
tested a higher-than-normal weighted average foreclosure frequency
(WAFF) for the part of the portfolio with IO maturity
concentrations to assess materiality of concentrations.

Asset Maturity Risks

In the 2006-III Fitch identified assets with maturity dates
exceeding those of the notes'. These assets comprise 0.2% of the
current pool. Note amortisation in this transaction can switch to
sequential from pro-rata in case of: (i) drawings on the reserve
fund; (ii) drawings on the liquidity facility; (iii) uncleared
balances on the principal deficiency ledgers; or (iv) more than
1.5% of loans being delinquent over two months.

Recently, note amortisation has switched to sequential for this
transaction due to a breach of the delinquency trigger. However, in
a benign economic environment it is possible for this transaction
to amortise pro-rata until note maturity. This implies a loss to
the notes equal to the balance of the loans that mature after the
notes.

The pool has shown a history of prepayments and the assets affected
by maturity mismatches are small as a proportion of the current
pool. Additionally, all such borrowers have at least one loan-part
that matures prior to note maturity. Should the borrower decide to
refinance that loan-part, they will have to refinance all their
outstanding loan parts.

Loan-parts maturing within the two years up until notes' legal
final maturity with regard to 2006-III represent 0.6% of the total
outstanding balance of the current pool. Given the curtailed time
to note maturity, if borrowers fail to refinance these loans
recoveries from the sale of the underlying properties may not feed
into the transactions.

Given the elevated risk to note default if the asset performance
remains stable and the magnitude of loans maturing within the two
years up until notes' legal final maturity, Fitch is of the opinion
that a rating of 'Bsf' is appropriate for the collateralised
notes.

Stabilising Performance

Late-stage arrears (borrowers who have been delinquent for over
three months) have stabilised over the last 12 months. As of
October 2019, late-stage arrears ranged from 0% (2008-IV) to 1.1%
(2006-III), where only 2006-III showed higher arrears than a year
ago. Similarly, the rate at which losses are building has
stabilised, although cumulative loss levels are still above market
average.

Pro-Rata Structures

As of the October 2019 payment date, the 2008-I and 2008-IV
transactions were amortising pro-rata. E-MAC NL 2008-I had been
paying sequentially, but recently reverted to pro-rata, reducing
the credit enhancement build-up for the senior notes as per the
amortisation mechanism in the documentation. This feature has been
factored into the rating analysis to the extent that the relevant
pro-rata triggers are captured by Fitch's modelling assumptions.

Fitch notes that there are no conditions that would result in a
switch to sequential note amortisation after amortisation has
crossed a certain threshold, which is deemed to be a non-standard
structural feature. With good asset performance, notes could
therefore amortise pro-rata until maturity. Where appropriate,
Fitch has thus assigned ratings that are different to those derived
by its cash flow model, where pro-rata triggers are breached at
some point in time.

Excess Spread Notes

The excess spread note in 2006-III has been affirmed at 'CCCsf'.
Principal redemption of this note ranks subordinate to the payment
of extension margins on the collateralised notes in the revenue
waterfall. As the extension margin amounts have been accruing and
remain unpaid, full principal redemption of the excess spread note
from interest receipts was considered unlikely. The only
possibility that remains for the class E notes to fully amortise
would be through the release of the reserve fund if it builds up
after significant deterioration of the pool (90+ arrears above 2%)
and then the built-up amounts are released after an improvement in
performance (90+ arrears below 2%).

The reserve funds in these transactions may increase following
asset performance deterioration. Funds collected would be released
once arrears drop again below the pre-defined three-month arrears
trigger, at which point the funds released will be used towards the
redemption of the excess spread notes. As the portfolios continue
to amortise, a small number of loans can lead to greater volatility
in arrears performance, leading to the possibility of continuous
replenishments and releases in the reserve funds, and subsequent
redemptions on the excess spread notes. Given this variability, the
credit risk of the excess spread notes of 2006-III is commensurate
with the 'CCCsf' rating definition, leading to their affirmation.

RATING SENSITIVITIES

Should the assets maturing after note maturity of 2006-III prepay,
it would address the risk of the notes incurring losses at
maturity. This may lead to positive rating actions.

Adverse macroeconomic factors may affect asset performance. An
increase in foreclosures and losses beyond Fitch's stresses may
erode credit enhancement leading to negative rating action.

However, due to the lack of a hard switch-back to sequential
amortisation, a moderate increase in delinquencies and widening in
losses might also be beneficial to the senior notes, as this would
cause the transactions to switch to sequential amortisation and an
increase in credit enhancement for those notes.


FLYBE: Ryanair Mulls Legal Action Against UK Gov't. Over Bailout
----------------------------------------------------------------
Alastair Dalton at Edinburgh Evening News reports that Ryanair
chief executive Michael O'Leary gave the UK Government a seven-day
ultimatum before launching proceedings over breaching competition
laws.

He also claimed that EasyJet, British Airways and other airlines
would join Ryanair in stepping in to provide flights if Flybe
failed, Edinburgh Evening News discloses.

The move comes a day after British Airways' owner reported the UK
Government to European Union competition authorities over
ministers' intervention to avert Flybe's collapse, Edinburgh
Evening News notes.

Flybe has 54 routes in Scotland -- 18 at Edinburgh, 15 at Glasgow
and Aberdeen and six at Inverness.

Mr. O'Leary demanded Chancellor Sajid Javid revealed what support
had been given to Flybe and that a "holiday" from paying air
passenger duty (APD) be extended to its competitors, Edinburgh
Evening News relays.

According to Edinburgh Evening News, in a letter, he wrote: "Should
you fail to confirm these facts within the next seven-day period,
please be advised that Ryanair intends to launch proceedings
against your Government for breach of UK and EU competition law,
and breach of state aid rules."

Mr. O'Leary also disputed ministers' claim that Flybe remained
viable and said a bailout would be for the "sole benefit" of its
"billionaire owners Delta Airlines, Sir Richard Branson and Cyrus
Capital", Edinburgh Evening News notes.

"This Government bailout of the billionaire owned Flybe is in
breach of both competition and state aid laws," Edinburgh Evening
News quotes Mr. O'Leary as saying.

"The reason why Flybe isn't viable is because it cannot compete
with lower fare services from UK regional airports on domestic and
EU routes provided by Ryanair, EasyJet, BA and others, and it
cannot compete with lower cost road and rail alternatives on many
smaller UK domestic routes.

"If Flybe fails (as it undoubtedly will once this government
subsidy ends) then Ryanair, EasyJet, BA and others will step in and
provide lower fare flights from the UK regional airports, as we
already have to make up for the recent failure of Thomas Cook
Airways."

                            About Flybe

Flybe styled as flybe, is a British airline based in Exeter,
England.  Until its sale to Connect Airways in 2019, it was the
largest independent regional airline in Europe. Flybe provides more
than half of UK domestic flights outside London.

As reported by the Troubled Company Reporter-Europe on Jan. 16,
2020, Reuters related that regional airline Flybe was rescued on
Jan. 14 after the British government promised to review taxation of
the industry and shareholders pledged more money to prevent its
collapse.  The agreement comes a day after the emergence of reports
suggesting it needed to raise new funds to survive through its
quieter winter months, Reuters disclosed.  Reuters related that the
Flybe shareholders agreed to put in tens of millions of pounds to
keep the airline running under the agreement.


MONSOON AND ACCESSORIZE: Woking Store to Close on January 28
------------------------------------------------------------
Beth Duffell at SurreyLive reports that one of the longest running
stores in the Peacocks Centre in Woking will be closing, as Monsoon
and Accessorize has announced it will shut for the final time at
the end of January.

According to SurreyLive, the clothing and jewellery shops will be
saying farewell to customers on Jan. 28.

In both the shops, which are joined together as one large unit in
the entrance to the shopping centre from Jubilee Square, posters
have been placed in the window, informing customers of the
impending closure, SurreyLive relates.

Sale signs, with discounts of up to 70% off, hang in the windows as
the last ranges of stock are sold in the stores, SurreyLive notes.

In April 2019, SurreyLive reported that Monsoon and Accessorize
could be the latest stores to disappear from high streets up and
down the country, after the owner of both brands called in advisers
to speed up its closure process, SurreyLive recounts.  At that
time, the parent company of the chains brought in Deloitte to
prepare plans for a possible Company Voluntary Arrangement (CVA),
SurreyLive relays.


PREFERRED RESIDENTIAL 06-1: Fitch Upgrades Class FTc Debt to Bsf
----------------------------------------------------------------
Fitch Ratings upgraded four tranches of Preferred Residential
Securities 05-2 PLC and five tranches of Preferred Residential
Securities 06-1 PLC and affirmed the others, as follows:

RATING ACTIONS

Preferred Residential Securities 06-1 PLC

Class B1a XS0243655577; LT AAAsf Affirmed; previously at AAAsf

Class B1c XS0243665022; LT AAAsf Affirmed; previously at AAAsf

Class C1a XS0243658670; LT AAAsf Upgrade;  previously at AAsf

Class C1c XS0243665964; LT AAAsf Upgrade;  previously at AAsf

Class D1a XS0243659728; LT Asf Upgrade;    previously at BBB+sf

Class D1c XS0243666939; LT Asf Upgrade;    previously at BBB+sf

Class E1c XS0243669529; LT B+sf Affirmed;  previously at B+sf

Class FTc XS0243675336; LT Bsf Upgrade;    previously at CCCsf

Preferred Residential Securities 05-2 PLC

Class B1a XS0234207594; LT AAAsf Affirmed; previously at AAAsf

Class B1c XS0234208485; LT AAAsf Affirmed; previously at AAAsf

Class C1a XS0234209020; LT AAAsf Upgrade;  previously at AAsf

Class C1c XS0234209459; LT AAAsf Upgrade;  previously at AAsf

Class D1c XS0234212594; LT A-sf Upgrade;   previously at BBB+sf

Class E1c XS0234213642; LT BB+sf Upgrade;  previously at BB-sf

TRANSACTION SUMMARY

The transactions are securitisations of seasoned non-conforming
residential mortgage loans originated by Preferred Mortgages
Limited.

KEY RATING DRIVERS

Updated UK RMBS Criteria Assumptions

The rating actions take into account the updated UK RMBS Criteria
assumptions which were published on October 4, 2019. The notes'
ratings have been removed from Under Criteria Observation.

The upgrades of the class C1 and D1 notes across the two
transactions and E1 notes of PRS 06-1 stem from the application of
the new criteria assumptions. In its analysis of the portfolio,
Fitch applied the buy-to-let (BTL) foreclosure frequency matrix to
the BTL portion of the portfolio.

Increasing Credit Enhancement (CE)

The sequential redemption of the notes has led to a build-up in CE
for all tranches. CE for the senior notes of PRS05-2 and PRS06-1
increased to 77.3% and 71.4% at end-2019, from 70.9% and 64.2%
respectively, two years ago. As the transaction structures are not
expected to revert to pro-rata, Fitch expects CE to increase
further in the medium term.

Stable Asset Performance

Three months arrears have decreased consistently since 2013/2014,
and stabilised between 12% and 14%. At end-2019, this measure had
increased since its last review to 13.4% from 11.8% in PRS 05-02,
and dropped to 11.8% from 12.6% in PRS 06-01. Despite their recent
fluctuations, the arrears levels remain considerably below the
levels seen during the crisis.

The servicer reports the balance of loans in arrears in terms of
loans with overdue monthly contractual payments, referred to as
delinquencies, and loans with overdue monthly contractual payments
and/or outstanding fees or other amounts due, referred to as
amounts outstanding. In its analysis, Fitch used the balances of
loans reported as delinquencies.

Sufficient Excess Spread

The current portfolio yields in PRS05-2 and PRS06-1 are 4.4% and
3.7%, respectively, supporting an average net excess spread of 1.5%
and 1.1% in the last two years. In light of the stable asset
performance and the limited prepayment rates, Fitch expects the
excess spread generated in PRS06-1 to be sufficient to redeem the
excess spread notes within 12-18 months. This led to the upgrade of
the class F1c notes of PRS06-1.

RATING SENSITIVITIES

Both portfolios are very seasoned. PRS-05 has 502 loans remaining
in the pool and PRS 06-01 767. The small borrower count could lead
to dependency on the reserve fund for protection against tail risk
losses, which could limit any further upgrades.


PREMIER OIL: Creditors Lodge Report Against Lender to FCA
---------------------------------------------------------
Niluksi Koswanage at Bloomberg News, citing the Sunday Times,
reports that a group of creditors filed a report against Premier
Oil Plc's biggest lender, telling the Financial Conduct Authority
the latter failed to disclose it had built a significant short
position on the British explorer's stock while trying to block
attempts to restructure debt.

Asia Research & Capital Management disclosed a 17% short position
on Premier Oil's shares that dates from July, Bloomberg relays,
citing the report.

The Hong Kong hedge fund has been resisting any potential extension
of Premier Oil's debt beyond 2021, Bloomberg notes.

A Scottish court earlier ruled that Premier Oil can go ahead with a
creditor vote on a proposed change in the terms for US$2 billion
worth of debt, Bloomberg recounts.  ARCM had sought to delay the
timetable proposed by the company, saying it was "ambushed" by
Premier Oil and had insufficient time to respond, Bloomberg
relates.

According to Bloomberg, Premier Oil said it has 86% support from
its super-senior debt holders and more than 75% backing from senior
lenders for its proposal.  ARCM holds more than 15% of the debt,
Bloomberg discloses.

Premier Oil plc is an independent UK oil company with gas and oil
interests in the UK, Asia, Africa and Mexico.


TED BAKER: Accounting Error Bigger Than Previously Thought
----------------------------------------------------------
Simon Foy at The Telegraph reports that Ted Baker has been forced
to reveal that an accounting blunder was more than twice as big as
previously thought, blowing a GBP58 million hole in the troubled
retailer's finances and piling further pressure on bosses.

The fashion firm said that a review by Deloitte had found the value
of stock on its books was overstated by GBP58 million, rather than
a previous estimate of between GBP20 million to GBP25 million, The
Telegraph relates.

This mistake is larger than the company's pre-tax profits for the
year to Jan 26, 2019, which stood at GBP50.9 million, The Telegraph
states.

The stock has lost more than three-quarters of its value since the
beginning of 2019, The Telegraph notes.

The Deloitte review also comes as an embarrassment to rival KPMG,
Ted Baker's auditor, which mentioned the issue in the retailer's
last annual report but concluded it was too small to affect the
company's accounts, The Telegraph discloses.

Ted Baker plc is a British luxury clothing retail company.  It is
listed on the London Stock Exchange.


[*] UK: Scottish Corporate Insolvencies Up 4% to 980 in 2019
------------------------------------------------------------
Scott Reid at The Scotsman reports that conditions may be
harshening for Scottish businesses after an increase in the number
of firms going bust last year.

The latest official statistics show that corporate insolvencies in
Scotland for the whole of 2019 were 4% up on the year before, at
980, putting them at their highest level since 2012, The Scotsman
relates.

The number of insolvencies actually fell by 4% in the October to
December period, compared with the previous three months, but were
up 8%, year-on-year, compared with the final quarter of 2018, The
Scotsman discloses.

According to The Scotsman, Tim Cooper, chair of insolvency and
restructuring trade body R3 in Scotland, which analyzed the
statistics from the Accountant in Bankruptcy (AIB), said: "The
higher level of corporate insolvencies in Scotland in 2019 compared
with previous years is a worrying sign that conditions may be
harshening for Scottish enterprises.

"The figures released do not include administrations or company
voluntary arrangements, either, meaning the true extent of Scottish
business difficulties could be even higher.

"If one word could be said to sum up 2019, there's an argument to
be made for it to be 'uncertainty'. Brexit uncertainty led to many
companies understandably taking a 'wait and see' approach on
everything from new equipment to decisions about opening offices.

"This in turn added sand to the wheels of dealmaking and business
investment, with knock-on effects for the economy as a whole."



                           *********


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 2020.  All rights reserved.  ISSN 1529-2754.

This material is copyrighted and any commercial use, resale or
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Information contained herein is obtained from sources believed to
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delivered via e-mail.  Additional e-mail subscriptions for
members of the same firm for the term of the initial subscription
or balance thereof are US$25 each.  For subscription information,
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