/raid1/www/Hosts/bankrupt/TCREUR_Public/200625.mbx        T R O U B L E D   C O M P A N Y   R E P O R T E R

                          E U R O P E

          Thursday, June 25, 2020, Vol. 21, No. 127

                           Headlines



A U S T R I A

AMS AG: Fitch Assigns BB- LT Issuer Default Rating, Outlook Stable
AMS AG: Moody's Assigns Ba3 CFR & Senior Unsecured Notes Rating


B E L A R U S

BELARUS DEVELOPMENT BANK: S&P Affirms 'B/B' Issuer Credit Ratings


F R A N C E

[*] FRANCE: Rising Corporate Debt to Leave Firms with Dud Loans


G E R M A N Y

THYSSENKRUPP AG: Egan-Jones Hikes Senior Unsecured Ratings to BB-
VERTICAL TOPCO III: Moody's Assigns B2 CFR, Outlook Stable


G R E E C E

MYTILINEOS SA: Fitch Alters Outlook on 'BB' IDR to Negative


I R E L A N D

BARINGS EURO 2017-1: Fitch Puts B- on Class F Debt on Watch Neg.
CITYJET: 57 Pilots Facing Redundancy Amid Examinership
GOLDENTREE LOAN 4: Fitch Gives 'B-(EXP)sf' Rating on Class F Notes
MADISON PARK VII: Fitch Puts B- on Class F Debt on Watch Neg.


I T A L Y

CENTURION BIDCO: Moody's Assigns B2 CFR, Outlook Stable


K A Z A K H S T A N

FREEDOM FINANCE: S&P Affirms 'B-/B' ICRs, Outlook Stable
OIL INSURANCE: S&P Affirms 'B+' LongTerm ICR, Outlook Stable


M A L T A

FIMBANK PLC: Fitch Affirms B+ LongTerm IDR, Outlook Negative


P O R T U G A L

TRANSPORTES AEREOS: Moody's Lowers CFR to Caa2, Outlook Neg.


R U S S I A

BELUGA GROUP: Fitch Affirms B+ LongTerm IDRs, Outlook Stable
NATIONAL FACTORING: S&P Withdraws 'B/B' Issuer Credit Ratings
PETROPAVLOVSK PLC: S&P Raises ICR to 'B' on Solid Performance


S P A I N

NH HOTEL: Moody's Lowers CFR to B3, Outlook Stable


T U R K E Y

ARAP TURK: Fitch Affirms LT IDRs at B+, Outlook Negative


U N I T E D   K I N G D O M

AMIGO LOANS: S&P Lowers ICR to 'CCC+' on Business Instability
ARDONAGH MIDCO 3: Fitch Cuts LT IDR to B-, Outlook Stable
CLARION EVENTS: S&P Lowers ICR to 'CCC+' on Weaker Liquidity
FERROGLOBE PLC: Fitch Lowers LT Issuer Default Rating to CCC-
GO OUTDOORS: JD Sports Buys Back Business From Administrators

GOLDENTREE LOAN 4: S&P Assigns Prelim B-(sf) Rating on Cl. F Notes
LONDON CAPITAL: FRC Set to Announce Probe on Three Auditors
MOORFIELD HOTEL: Owner Opts to Close Hotel, 45 Jobs Affected
VALARIS PLC: Egan-Jones Lowers Sr. Unsecured Debt Ratings to C

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A U S T R I A
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AMS AG: Fitch Assigns BB- LT Issuer Default Rating, Outlook Stable
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Fitch Ratings has assigned ams AG a Long-Term Issuer Default Rating
(IDR) of 'BB-' with a Stable Outlook. The agency has also assigned
a 'BB-(EXP)' expected rating to the ams's proposed senior unsecured
notes.

The ratings reflect ams's improved business profile following its
acquisition of OSRAM, which will increase the company's scale and
diversify its end-markets. The rating also incorporates the
significant execution and integration risk associated with the
OSRAM acquisition, which may result in cash flows lower than
Fitch's expectations, limiting the company's debt reduction
capacity.

The ratings are based on the assumption that the domination
agreement is successful.

KEY RATING DRIVERS

High Execution and Integration Risk. OSRAM is broadly twice the
size of ams by revenue and it is by far the biggest acquisition ams
has attempted. The operational integration between the two entities
and expected synergy benefits carry significant risks of delay.
Cash flows lower than Fitch's expectations in the two to three
years after the acquisition closes could lead to rating pressure.

High Leverage Likely to Reduce: The company's expected gross and
net funds from operations (FFO) leverage will be high for the
rating at end-2020, at around 5x. Fitch expects that over the
medium term, ams's management will prioritise debt repayment from
free cash flow (FCF) and broadly align the capital structure with
'BB' category expectations. Fitch expects that by end-2023, gross
and net leverage should improve to under 3x and 2x, respectively.

Strengthening FCF: Fitch expects the company's FCF to be slightly
positive in 2020 and 2021, partly as a result of significant
integration costs that are likely to be incurred in the period.
Beyond 2021, as these costs subside and synergy benefits will begin
to be tangible, Fitch expects FCF will strengthen to over 5% of
revenue on a sustained basis, which would be considered strong for
the rating, and allow for meaningful debt reduction.

Acquisition Improves Business Profile: Once the OSRAM acquisition
is complete it will significantly alter ams's business profile. It
will give the company greater scale, a broader product range,
access to a wider variety of end-markets and improved bargaining
power with suppliers.

Part Ownership Could Limit Improvement: The rating factors in
Fitch's assumption that ams will acquire 100% of OSRAM shares by
the end of 2020. Failure to acquire all of OSRAM will lead to cash
leakage related to paying dividends to minorities and therefore
lower cash flow margins. While the financial profile in this case
will likely be structurally weaker, Fitch does not believe that it
will place additional pressure on the rating. However, it may
affect the timing of any positive rating action.

DERIVATION SUMMARY

Post OSRAM acquisition, ams's credit profile is expected to be in
line with 'BB' category rated diversified industrial peers, given
its leading share in global automotive and sensor solutions, decent
geographic concentration and strong profitability and cash flow
generation. The company compares favourably with US technological
'BB' category peers in terms of profitability and cash flow
margins, but leverage and customer concentration are weaker for
ams.

The closest peer in the diversified and manufacturing sector is
Borets (B+/Negative), which has more limited geographic
concentration. Borets' profitability is somewhat closer to ams with
margins around towards 30%. However, in the short term ams's
leverage will be high for the 'BB' category, a key factor in
limiting the rating at 'BB-' at present.

Microchip Technoloy Inc (BB+/Negative), performs better in terms of
profitability, with 35% - 40% EBITDA margins, relative to ams's
mid-20%, and stronger FFO margins, supporting a more relaxed
treatment of higher leverage metrics, which are driven by
acquisition.

KEY ASSUMPTIONS

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

  - 50% of OSRAM consolidation in 2020; 100% consolidation as of
2021.

  - Divesture of the OSRAM digital segment completed in 2021;
EUR800 million of proceeds.

  - Revenue synergies; FYE21 EUR5 million; FYE22 EUR70 million;
FYE23-24 EUR200 million.

  - EBITDA margins improving to 25% post full acquisition with a
gradual realisation of synergy benefits and a stabilisation of
end-markets.

  - Capex 11% for the rating horizon as per company guidance.

  - Working capital flows stabilising.

  - Non-operating represent transaction and synergy costs; FYE20
EUR199 million 2020; FYE21 EUR115m, FYE22 EUR16 million following
management's guidance

  - Revolving credit facility (RCF) undrawn over the rating
horizon.

  - No dividend in the medium term.

  - No new acquisitions assumed.

RATING SENSITIVITIES

Factors that could, individually or collectively, lead to positive
rating action/upgrade:

  - FCF margin above 5%

  - Divestment of the OSRAM digital division in 2020 with the
proceeds used to reduce net leverage

  - Gross leverage below 3x

Factors that could, individually or collectively, lead to negative
rating action/downgrade:

  - Failure to integrate and restructure OSRAM with materially weak
cash flows after 2021; FCF below 1% after 2021

  - Gross leverage above 4x after 2021

  - Net leverage above 3x

LIQUIDITY AND DEBT STRUCTURE

Satisfactory Liquidity: Fitch views ams's liquidity as comfortable,
given EUR750 million (December 2019: EUR460m) available cash on
balance sheet as of March 2020 and EUR450 million RCF, currently
fully undrawn. Fitch expects FFO generation to remain strong at
around 17% - 20%, but the company has historically generated
negative FCF due to high capex. After 2021, Fitch expects FCF to be
positive on a sustained basis. The company's capex is forecast to
be around 11%-12%.

Although there is no restricted cash on the balance sheet, Fitch
assumes EUR40 million restricted cash for historical years and
EUR100 million in future, mainly for working capital swings.

Debt Structure: The company has a well spread maturity debt
structure, although it is not well diversified. ams will issue debt
to fund the acquisition of OSRAM. The company initiated the bridge
facility of EUR450 million, with 3% interest in 2019 to facilitate
the purchase of 19% OSRAM shares, and in 2020 the company will
raise unsecured notes of EUR1 billion to take its stake to 68.4%.
Acquisition of up to 100% of OSRAM will be financed with a mix of
cash and debt.

ESG Considerations

ESG issues are credit neutral or have only a minimal credit impact
on the entity(ies), either due to their nature or the way in which
they are being managed by the entity(ies).

SUMMARY OF FINANCIAL ADJUSTMENTS

There is historically no restricted cash on the balance sheet but
Fitch assumes EUR40 million restricted cash for historical years
and EUR100 million in future, mainly for working capital swings.


AMS AG: Moody's Assigns Ba3 CFR & Senior Unsecured Notes Rating
---------------------------------------------------------------
Moody's Investors Service has assigned a Ba3 corporate family
rating and Ba3-PD Probability of Default rating to ams AG.
Concurrently, Moody's has assigned a Ba3 instrument rating to the
planned EUR1,000 senior unsecured notes due 2025. The outlook on
all ratings is negative.

On September 3, 2019 ams AG announced an all-cash takeover offer
for all shares of Osram and will hold a stake of 68% at closing.
The proceeds, together with the proceeds from a recent rights
issue, will be used to finance the acquisition of OSRAM, refinance
their existing debt and pay associated costs.

RATINGS RATIONALE

The Ba3 corporate family rating positively reflects (1) the
company's leading market position with high innovation capabilities
in the quickly evolving market for high performance sensors, (2)
the strong secular market trends in the defined end-markets with
compelling growth opportunities, (3) the good diversification in
terms of products and use cases across industries with increasing
penetration of high-performance sensors, (4) the complementary
rationale of the transformational acquisition of Osram to
significantly increase scale and form a global leader in the
sensors and photonics market and (5) high EBITDA-margins above 20%
and solid free cash flow generation above EUR300million in 2020 in
its base case.

Nevertheless the rating is constraint by (1) a high leverage pro
forma for the transaction of 5.6x expected for 2020 and 3.8x for
2021 (Moody's adjusted including corporate amendments) (2)
significant execution and integration risks as well uncertainty
around full achievability of planned cost synergies and
restructuring of the combined group which are necessary to reduce
leverage, (3) the company's low diversification in terms of
end-customers and related high dependency on such end-customers
development, (4) the high exposure to the highly cyclical
end-markets automotive and consumer electronics which are currently
negatively affected by the outbreak of the coronavirus.

ENVIRONMENTAL, SOCIAL AND GOVERNANCE CONSIDERATIONS

The rapid and widening spread of the coronavirus outbreak in 2020,
deteriorating global economic outlook, falling oil prices, and
asset price declines are creating a severe and extensive credit
shock across many sectors, regions and markets. The semiconductor
sector has been one of the sectors adversely affected by the shock
given its sensitivity to consumer demand and budget spending. The
combined credit effects of these developments are unprecedented.
Moody's regards the coronavirus outbreak as a social risk under its
ESG framework, given the substantial implications for public health
and safety. Its action reflects the impact on ams of the breadth
and severity of the shock, and the broad deterioration in credit
quality it has triggered.

LIQUIDITY

Moody's considers ams' liquidity position to be adequate, supported
by ca. EUR800 million of cash on the balance sheet post transaction
and full availability under the existing EUR450 million revolving
credit facility. The RCF contains a maintenance leverage covenant.
Moody's expects the company to retain sufficient headroom under
this covenant. The next major debt maturity is the bridge financing
of the acquisition due in June 2021.

STRUCTURAL CONSIDERATIONS

The senior unsecured bonds will be borrowed by ams AG, the
non-operative holding of the group. The documentation of the notes
includes certain incurrence-based covenants. It is expected that
ams will raise further debt to finance the remaining stake of Osram
together with cash from balance sheet and FCF following the
implementation of the Domination and Profit and Loss transfer
agreement.

RATING OUTLOOK

The negative outlook reflects the high complexity of the
acquisition of Osram in a quickly evolving market with significant
execution risks and exposure to industries which are significantly
affected by the outbreak of the coronavirus pandemic. The
transaction requires meaningful restructuring of the Osram business
with related uncertainty around full achievability and timing of
the planned cost improvements and corporate actions. Once the
refinancing of the corporate actions and restructurings are fully
executed and absence of any adverse market conditions, Moody's
might consider stabilizing the outlook.

FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS

Albeit unlikely at this point, ams ratings could be upgraded if (i)
the company reduces the Moody's adjusted debt/EBITDA below 3.0x and
(ii) EBITDA margins approaching 30% and (iii) free cash flow/debt
is consistently above 10% and (iv) absence of elevated shareholder
distributions and debt-funded acquisitions.

Ams' ratings could be downgraded if (i) Moody's adjusted
debt/EBITDA remains sustainably above 4.0x or (ii) the company
fails to achieve meaningful margin improvements or achieves lower
divestment proceeds from the planned corporate actions or (iii)
EBITDA-margins of the combined ams/Osram falling below 20% or (iv)
free cash flow/debt falls to single-digit in percentage terms or
(v) any sign of weakening liquidity.

PRINCIPAL METHODOLOGY

The principal methodology used in these ratings was Semiconductor
Industry published in July 2018.

COMPANY PROFILE

Ams AG is an Austria-based producer of high-performance sensors to
the consumer electronics, automotive and healthcare industry. The
company operates 4 manufacturing sites and 16 design centers with
around 8,500 employees worldwide whereof 1,100 are engineers.

Ams is specialized in optical, imaging and audio sensors and has
advanced capabilities in providing small-scale, low-power, highest
sensitivity sensor solutions with tight integration into the
end-customers products. Ams intends to acquire 100% of the shares
of Osram Licht AG for a total consideration of EUR4.4 billion.

Osram is a German-based producer of high-tech semiconductors and
micro modules as well as lighting solutions primarily to the
automotive industry accompanied by exposure to Industrial and
General Lighting industries. The company operates 26 productions
facilities with around 24,700 employees worldwide.

Following the acquisition, ams intends to restructure and support
the already announced initiatives to increase profitability which
includes possible corporate actions such as amendments in the
global production footprint or divestment of certain segments. Post
integration and restructuring, the combined ams / Osram will
generate around EUR3.9 billion in revenues and a reported EBITDA of
EUR1.0 billion on a management reported pro-forma basis in 2020 in
its base case.




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BELARUS DEVELOPMENT BANK: S&P Affirms 'B/B' Issuer Credit Ratings
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S&P Global Ratings affirmed its 'B/B' long- and short-term foreign
and local currency issuer credit ratings on Development Bank of the
Republic of Belarus JSC (DBRB). The outlook is stable.

S&P equalizes its ratings on DBRB with those on Belarus. This is
because, in its view, there is an almost certain likelihood that
government would provide DBRB with timely and extraordinary support
sufficient to service the bank's financial obligations, if needed.
S&P bases its assessment on its view of DBRB's:

-- Integral link with the Belarusian government, demonstrated by
the state's 100% ultimate ownership, capital injections provided in
the past, and the government's promise to pay the bank's bonds when
the institution does not itself have the resources to do so in
certain cases. Key government figures, including the prime
minister, are members of DBRB's supervisory board, and we
understand that the bank regularly reports on its financial
standing to the Ministry of Finance. The state therefore continues
to maintain close oversight of the bank's activities. S&P does not
currently expect these arrangements to change.

-- Critical public policy role as the main institution providing
long-term loans under the Belarusian government's direction, and a
tool to fulfill several other policy functions. As of year-end
2019, DBRB's total assets were equivalent to 7% of GDP and
constituted 12% of the banking system's assets. DBRB continues to
be a key agent in the implementation of certain projects and
programs that the government considers important for the country.

S&P said, "We currently view the Belarusian government's overall
capacity to support its government-related entities (GREs) as
doubtful. However, we believe that DBRB's importance in achieving
several political and social objectives would lead the government
to prioritize support to DBRB ahead of its other GREs."

Mandate and activities: A development institution operating under
the government's direction

DBRB was established in 2011, following the International Monetary
Fund's recommendation on reforming Belarus' banking sector, which
had been heavily involved in directed, subsidized lending under
vaguely defined government programs. The bank's initial objective
was to centralize lending under such programs, thereby enabling
state-owned commercial banks to function on market terms. S&P
believes this goal has been only partially achieved, given that
some government-led lending remains with other state-owned banks
operating in Belarus, including Belarusbank and Belagroprombank.

DBRB's mandate has since broadened to include:

-- Financing capital-intensive long-term investments and important
social projects;

-- Acting as an export bank, supporting Belarusian producers
focused on overseas markets;

-- Managing certain assets of the wood-processing sector on behalf
of Ministry of Finance to improve recovery of corresponding
budgetary loans to the enterprises in the sector;

-- Supporting development and extending investment credit to small
and midsize enterprises (SMEs); and

-- Serving as an agent of the government for managing cashless
lump sums introduced in late 2014 to families with three children
or more (known as "family capital").

DBRB's mandate was amended in December 2019 with several new
activities explicitly codified. This is largely in line with S&P's
previous expectations, based on the ongoing initiatives to clarify
the institution's mandate over the past few years. In addition to
the activities listed above, DBRB will finance investment projects
that it selects on its own; fund projects on a PPP basis; and lend
to SMEs for investment needs as well as for current operations. The
floor on export credit support provision has also been lowered. A
moratorium on dividends for the financial years 2019-2022 has been
introduced.

Still, the backbone of DBRB's strategy will remain the financing of
large investment projects, Belarus' exports, and SMEs. S&P does not
expect additional amendments to DBRB's short-term mandate,
including any changes because of the COVID-19 pandemic. The bank
has utilized several measures that the National Bank of the
Republic Of Belarus (the central bank) introduced earlier, such as
using the favorable exchange rate in the calculation of capital
ratios given that the local currency has depreciated by 11% since
the beginning of the year. However, S&P does not anticipate any
special role for the bank in the current environment in terms of
extending support to the affected sectors or households.

Ownership structure: DBRB set to remain fully state-owned

At present, the government directly controls 96% of DBRB through
the Council of Ministers, while Belaruskali (national 100%
state-owned potash fertilizer company) holds a 4% stake. The
National Bank of the Republic Of Belarus (NBRB; the central bank)
previously held a minor 0.012% stake in DBRB before exiting in
mid-2019. This will not affect DBRB's operations, in S&P's view.
S&P anticipates that DBRB will remain fully state-owned.

For several years after its establishment, as a development
institution, DBRB was not subject to the same prudential regulatory
requirements as commercial banks. S&P said, "However, we note that
the supervisory and regulatory requirements for DBRB were tightened
in 2016, and many of the requirements applicable to commercial
banks now also apply to DBRB. We also note that, unlike many other
development institutions, particularly in Europe, DBRB is not
exempt from paying corporate income tax."

Government support: Characterized by capital injections and an
established framework

The government of Belarus has made several equity injections into
DBRB. It did so every year in 2012-2015 and, in 2016, the bank's
capital increased through retained profit. Although no capital
increase was initially foreseen in 2018, the government made an
equity injection of Belarusian ruble (BYN) 245 million (about $120
million) in order to support activities in the leasing segment and
prevent the institution's capital ratio from weakening. A smaller
capital injection of BYN110 million (about $50 million) took place
in February 2020, also to support the leasing segment operations.

At present, there are no plans to further capitalize the
institution. S&P notes, however, that at the end of 2019 the
government introduced a moratorium on DBRB's dividend payments
relating to financial years 2019-2022.

S&P views positively the government's promise to pay on DBRB's
bond-type debt in certain circumstances if the bank itself does not
have enough resources to do so. The relevant mechanism, known as
secondary liability, was described in a presidential decree adopted
in 2014. The mechanism and conditions of the secondary liability
have been further clarified in the bond documentation for the two
Eurobonds DBRB issued in April-May 2019.

Importantly, the secondary liability does not constitute a full
guarantee of payment on DBRB's debt because:

-- It does not necessarily ensure timeliness of payment by the
government of Belarus on DBRB bonds in the event of bank's
financial distress;

-- It can be amended or withdrawn through a presidential edict;

-- The government's obligations regarding the secondary liability
rank lower than Belarus' senior unsecured debt;

-- It applies only under Belarusian law, rather than
international; and

-- It covers only the bond-type debt, excluding other types of
financial obligations of DBRB, for example loans.

S&P said, "Nevertheless, we believe the secondary liability
mechanism provides further incentives for the authorities to extend
timely and sufficient extraordinary financial support in a
hypothetical stress scenario. We expect financial support, if
needed, would be provided by the Ministry of Finance, because DBRB
does not have recourse to central bank funding, according to the
amended decree governing its activities."

The government is currently working on a further resolution that
will specify measures that could be used to extend financial
support to DBRB if required. Although the resolution is not
finalized, S&P understands that such measures could include placing
government deposits with DBRB; purchasing the bank's securities;
and increasing capital. S&P assumes it will likely be adopted in
the coming weeks.

Financial standing: Broadly unchanged risk profile, but asset
quality could deteriorate

S&P said, "DBRB's credit risk profile remains largely unchanged, in
our view. The bank's asset quality indicators were comparable with
those of its domestic peers as of end-2019. Problem loans (measured
as Stage 3 plus purchased and originated credit-impaired loans
defined under International Financial Reporting Standards)
accounted for 8.6% of DBRB's gross loan portfolio, slightly better
than a weighted average of 11% for Belarus' banking system at
end-2019. The provisioning coverage of about 50% of total problem
loans at the same date was also better that the level we observed
in the system (about 40%).

"Nevertheless, we now consider that there is increasing downside
risk to the bank's asset quality. This is due to high level of
foreign currency loans (44% of loan book, though slightly below
system average of 50%) given the recent volatility of the BYN
exchange rate and our expectation of elevated credit risks in 2020
resulting from COVID-19-induced recession in Belarus and its key
trading partners. We expect that Belarus' economy will contract by
5% in real terms this year. In addition, DBRB's mandate as a
development institution and its involvement in relatively riskier
projects in terms of duration, size, and recovery prospects add to
the strain on the asset quality. However, we anticipate DBRB's
capital cushion coupled with established risk management practices,
monitoring, and collection, should help the bank to contain the
pressure on its asset quality."

DBRB complies with all prudential ratios applied by the NBRB. As of
June 1, 2020, its regulatory capital adequacy ratio stood at 19.7%,
representing a buffer compared with the 12.0% minimum
requirements.

The bank's customer franchise is weak, as by law, it cannot accept
deposits from individuals or corporations, except in cases when
entities that participate in state programs deposit funds used for
loan repayments. Therefore, funding base is dominated by issued
securities (46%) and loans from banks (34%). A sizable proportion
of securities, however, pertain to government financing: Securities
held by the central bank constitute 15% of the total funding base.
At the moment S&P doesn't see marked pressure on the funding
profile and expect the bank will manage refinancing bank loans.

Still, S&P considers the funding structure as vulnerable and
bearing potential risk, particularly in light of the volatile and
changing investor sentiment towards emerging markets this year.
DBRB issued two Eurobonds in 2019--one denominated in U.S. dollars,
the other in Belarusian rubles. The latter benchmark also helps
form a market indicator for long-term funding in Belarusian rubles.
The overall maturity profile of the debt is quite comfortable with
around 70% maturing beyond a one-year horizon.

The bank's liquidity continues to be supported by liquid assets
(cash and cash equivalents plus government securities) representing
about 20% of DBRB's total assets or 30% of total liabilities. S&P
considers that the bank's stable funding ratio of 122% as of
year-end 2019 is sustainable in the long term (four-year average of
the ratio is 118%).

DBRB's creditworthiness is linked to that of the sovereign. S&P
said, "We do not assess a stand-alone credit profile for DBRB
because we view the likelihood of extraordinary government support
for the bank as almost certain given that the institution executes
a number of policies important for the government. We currently do
not consider government support being subject to transition risk."

The stable outlook on DBRB mirrors the outlook on Belarus. It also
reflects balanced risks to the ratings over the next 12 months.

S&P could raise its ratings on DBRB if it took a positive rating
action on Belarus, provided that DBRB's integral link with and
critical role for the government remained unchanged.

S&P said, “We could lower our ratings on DBRB following a
negative rating action on the sovereign. Outside of a sovereign
rating action, we could take a negative action on DBRB if its link
with, or role for the government weakened over the next 12 months."
This could occur, for example, if the institution's capitalization
levels declined, alongside a watered down mandate or government's
diminished commitment to provide support.




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[*] FRANCE: Rising Corporate Debt to Leave Firms with Dud Loans
---------------------------------------------------------------
Leigh Thomas at Reuters reports that rising French corporate debt
could leave firms struggling to survive and saddle banks with dud
loans, the central bank said on June 23 in its biannual financial
risk report.

According to Reuters, the Bank of France said French companies went
into the coronavirus crisis with debt already at record levels,
topping 72% of gross domestic product at the end of last year.

A nearly two-month coronavirus lockdown left many with little
choice but to tap state-guaranteed bank loans as their cashflows
all but dried up, providing short-term relief by adding to their
debt burdens, Reuters discloses.

Companies have so far taken on additional debt of more than EUR100
billion (US$112.9 billion) of such state-backed loans, with
three-quarters going to small and medium-sized firms, Reuters,
relays, citing data from the finance ministry.

The OFCE economics think-tank estimates France will see 40,000
bankruptcies this year on top 55,000 that could be expected under
normal circumstances, Reuters states.




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G E R M A N Y
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THYSSENKRUPP AG: Egan-Jones Hikes Senior Unsecured Ratings to BB-
-----------------------------------------------------------------
Egan-Jones Ratings Company, on June 15, 2020 upgraded the foreign
currency and local currency senior unsecured ratings on debt issued
by thyssenkrupp AG to BB- from B.

Headquartered in Essen, Germany, thyssenkrupp AG manufactures
industrial components.



VERTICAL TOPCO III: Moody's Assigns B2 CFR, Outlook Stable
----------------------------------------------------------
Moody's Investors Service assigned a B2 corporate family rating and
a B2-PD probability of default rating to Vertical TopCo III GmbH, a
future intermediate holding company of German elevator and
escalator manufacturer thyssenkrupp Elevator AG. Moody's further
assigned (1) B1 instrument ratings to the proposed EUR500 million
(equivalent) senior secured term loan A, EUR3,050 million
(equivalent) senior secured term loan B, EUR2,000 million
(equivalent) senior secured notes, EUR1,000 million senior secured
floating rate notes, and EUR2,000 million unfunded senior secured
facilities for cash and guarantees, issued by Vertical Midco GmbH
and Vertical U.S. Newco Inc., and (2) a Caa1 instrument rating to
the proposed EUR1,700 million (equivalent) senior unsecured notes,
issued by Vertical Holdco GmbH. The outlook on all ratings is
stable.

This is the first time that Moody's has rated thyssenkrupp
Elevator.

Proceeds from the proposed debt issuances will be used to finance
the acquisition of thyssenkrupp Elevator from thyssenkrupp AG
(tkAG, B1 Developing) by private equity firms Cinven and Advent
International, as well as the Abu Dhabi Investment Authority
(ADIA), Singaporean GIC and the German RAG foundation, for a
purchase price of EUR17.2 billion plus expected transactions fees
and expenses. tkAG, through a EUR1.25 billion reinvestment, will
retain an around 19% stake in the group. The acquisition will be
further financed with EUR6.7 billion of sponsor cash equity and
EUR2.0 billion PIK notes outside the restricted group, which
Moody's considers as equity.

"thyssenkrupp Elevator is initially very weakly positioned in the
B2 category driven by its high starting leverage that requires
performance improvements for a more solid positioning very quickly
and leaves no cushion for underperformance. In addition, the rating
recognizes thyssenkrupp Elevator's resilient business model with a
sizeable share of recurring service and modernization revenues,
attractive industry fundamentals and its expectation of strong
profitability improvements and positive free cash flow generation
over the next two years", says Goetz Grossmann, a Moody's Vice
President - Senior Analyst and lead analyst for thyssenkrupp
Elevator. "The assigned ratings do not factor in any headroom for
dividend payouts or sizable debt-funded acquisitions until credit
metrics will have improved to levels in line with the B2 rating
category."

RATINGS RATIONALE

The B2 CFR is further constrained by (1) the group's exposure to
the generally cyclical construction industry, where growth has
softened recently against slowing economic activity amid the
coronavirus pandemic (which still limits visibility on the final
implications of the outbreak for thyssenkrupp Elevator), (2) its
significantly levered capital structure following the acquisition,
as shown by a Moody's-adjusted debt/EBITDA ratio of almost 9.5x at
transaction closing, which Moody's expects to reduce towards 7.5x
over the next two years; (3) extensive and costly restructuring
required to achieve the targeted efficiency improvements and
considerable cost savings, while implementation and execution risks
persist; (4) foreign currency risk (largely translational) with
around 77% of group revenues being generated in currencies other
than the euro, which weighed on thyssenkrupp Elevator's sales and
profitability in the financial year ended September 30, 2018
("financial 2018"); (5) price pressure and intense competition in
China from both international (including Japanese) and local
competitors; (6) exposure to volatile raw material prices,
especially in the largest new equipment market China, which
pressured thyssenkrupp Elevator's profitability in financial 2018,
while the ability to pass on rising input costs to customer is
limited; (7) lack of a track record as an operating entity after
the separation from tkAG, from which it received corporate and
other services that need to be established on a standalone basis,
which may be more costly than estimated by management; (8) an
aggressive financial policy, illustrated by the substantial amount
of debt raised to fund the acquisition and a limited starting cash
position; and (9) social risks attached to health and safety
concerns of thyssenkrupp Elevator's end-users and employees alike.

thyssenkrupp Elevator's rating is supported by its (1) strong
business model as one of the world's largest manufacturers and
services providers in the attractive elevator and escalator (E&E)
market, which benefits from mega trends such as a rapid
urbanization, demand for improved mobility by an ageing population
and tightening safety regulations; (2) leading market shares across
the Americas, Europe Africa and Asia Pacific regions, with a
particular strong presence in the highly profitable since more
services oriented Americas market (41% of revenues in financial
2019); (3) broad and state-of-the-art product offering, which
Moody's expects to drive above GDP topline growth over the next
five years; (4) sizeable installed base with around 1.4 million
units currently under management; (5) resilient business thanks to
over 40% of revenues being derived from multi-year services
contracts, which provide good visibility and are fueled by the
constant conversion of new installations into services, especially
in the world's largest elevator market China (17% of group sales);
(6) healthy profitability, although currently below industry
standard, which management targets to significantly improve over
the next few years through manufacturing optimizations and cost
cutting, besides the better growth prospects for the more
profitable services segment; (7) positive free cash flow generation
due to generally low maintenance capital spending, moderate working
capital needs and Moody's expectation of no dividend payments; (8)
diverse customer base with the top ten customers accounting for
less than 3% of group revenue; and (9) experienced management team,
which is committed to execute an ambitious growth strategy, focused
on strengthening profitability and maintaining a strong cash
conversion.

LIQUIDITY

thyssenkrupp Elevator's liquidity is adequate, reflecting Moody's
forecast of positive FCF generation and no material debt maturities
over the next seven years after transaction closing. Although the
transaction does not foresee any overfunding and there will be no
material cash on the balance sheet at closing, typical working
capital releases in the fourth financial quarter (assuming closing
at June-end 2020) and the group's proposed EUR2 billion unfunded
facilities for cash and guarantees (of which EUR1,000 million
available for cash drawings) provide more than sufficient liquidity
to cover its basic cash needs over the next 12-18 months.

The proposed facilities for cash and guarantees are subject to one
springing covenant (Senior Secured Net Leverage Ratio), which needs
to be tested when the aggregate amounts outstanding under the
facilities less cash and cash equivalents exceed 40% of the total
commitments of these facilities

The covenant has been set with significant headroom and Moody's
expects thyssenkrupp Elevator to ensure consistent adequate
capacity under this covenant at all times.

ENVIRONMENTAL, SOCIAL AND GOVERNANCE CONSIDERATIONS

Moody's takes into account the impact of environmental, social and
governance (ESG) factors when assessing companies' credit quality.
thyssenkrupp Elevator's ratings factor in its private equity
ownership and an aggressive financial policy, illustrated by its
very high financial leverage and the existence of significant PIK
notes issued outside the restricted group, which will be used to
fund the acquisition but are not included in its leverage
calculations.

STRUCTURAL CONSIDERATIONS

Upon completion of the acquisition, the proposed senior secured
term loans, facilities for cash and guarantees and notes will be
guaranteed by subsidiaries accounting for around 80% of
consolidated EBITDA of the Group within certain agreed
jurisdictions (Australia, Canada, any member state of the EU, Hong
Kong, New Zealand, Norway, Singapore, Switzerland, the UK, the US)
and secured by certain assets of the guarantors. These facilities,
together with trade payables, rank first in Moody's loss given
default (LGD) assessment. The proposed senior unsecured notes,
which benefit from the same guarantees as the senior secured
instruments on a subordinated basis, are ranked second in the LGD
assessment, together with unsecured lease rejection claims and
pension obligations.

Applying Moody's standard 50% recovery rate for capital structures
consisting of bond and bank debt, the senior secured instruments
are rated B1, one notch above the assigned CFR, while the unsecured
notes are rated two notches below the CFR at Caa1, given their
material loss absorption capacity in a hypothetical default
scenario.

OUTLOOK

While the ratings are initially weakly positioned, the stable
outlook reflects the group's solid liquidity position and Moody's
expectation of consistent positive free cash flow generation,
including in a scenario of potentially softening demand over the
next quarters due to the coronavirus pandemic. The outlook is
further predicated on a forecast progressive de-leveraging, leading
to Moody's-adjusted gross debt/EBITDA declining towards 7.5x by the
end of financial 2022. Any signs of a delay in such de-leveraging
or weakening free cash flow generation, however, would lead to
imminent downward pressure on the ratings.

FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS

Upward pressure on the ratings appears unlikely at this stage,
considering thyssenkrupp Elevator's very high starting leverage and
the existence of a substantial amount of PIK notes above the
restricted financing group, reflecting some risk of associated cash
leakage over time. However, thyssenkrupp Elevator's ratings could
be upgraded, if (1) the group's targeted profitability improvements
supported de-leveraging to sustainably below 6.5x Moody's-adjusted
debt/EBITDA, (2) Moody's-adjusted FCF/debt ratios improved to at
least 5%, (3) a prudent financial policy was established, as shown
by excess cash flow being applied to debt reduction and no material
shareholder distributions.

Downward pressure on thyssenkrupp Elevator's rating would build, if
(1) the group failed to steadily reduce leverage towards 7.5x
Moody's-adjusted debt/EBITDA by the end of financial 2022, (2)
Moody's-adjusted free cash flow turned negative, (3) its liquidity
started to deteriorate.

PRINCIPAL METHODOLOGY

The principal methodology used in these ratings was Manufacturing
Methodology published in March 2020.

COMPANY PROFILE

Headquartered in Essen, Germany, Vertical TopCo III GmbH is an
intermediate holding company of thyssenkrupp Elevator AG, a leading
manufacturer of elevators and escalators with a presence in the
Americas, Europe/Africa and Asia regions. In fiscal year ended
September 30, 2019, the group generated almost EUR8 billion in
revenue and company-adjusted EBIT of EUR819 million (10.3%
margin).

In February 2020, a consortium led by global private equity firms
Advent International and Cinven, together with the Abu Dhabi
Investment Authority (ADIA), Singaporean GIC and the German RAG
foundation, announced the acquisition of thyssenkrupp Elevator from
German diversified industrial group tkAG for a purchase price of
EUR17.2 billion. tkAG, through a EUR1.25 billion reinvestment, will
retain an around 19% stake in the group.




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G R E E C E
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MYTILINEOS SA: Fitch Alters Outlook on 'BB' IDR to Negative
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Fitch Ratings has revised the Outlook on Mytilineos S.A.'s
Long-Term Issuer Default Rating to Negative from Stable and
affirmed the IDR and senior unsecured ratings at 'BB'.

The revision of the Outlook reflects the weak macro environment
with prolonged low commodity prices, material pressure on aluminium
consuming industries, the expected underperformance of engineering,
procurement and construction business and uncertainties around the
coronavirus situation/shape of the recovery. Fitch projects funds
from operations net leverage to average 3.5x in 2020-2021, which is
above its sensitivity for a negative rating action of 3.0x.

Fitch views this increase in leverage as temporary, driven by
MYTIL's sizeable capex of EUR300 million over the next three years
for the construction of the new power plant, which will provide
material EBITDA contribution and stability of cash flows once it
begins operations in 2022. Fitch expects net leverage to trend
comfortably below 3.0x in 2022 after the bulk of the new power
plant capex. The Negative Outlook also reflects significantly less
headroom to proceed with new organic investment or bolt-on
acquisitions.

Fitch believes that MYTIL is well-placed to cope with the impact of
the coronavirus pandemic, with comfortable liquidity and no
material debt maturities before 2024. Fitch also believes that
solid power & gas performance will provide the group with
sustainable cash flows over the rating horizon and help cushion
weaker metallurgy and EPC results; a significant advantage of the
company's business profile.

The affirmation is underpinned by MYTIL's diversified business
profile, synergistic business model, vertically integrated and low
unit-cost metallurgy operations as well as strong and growing
market position in the domestic electricity market.

KEY RATING DRIVERS

Elevated Leverage: MYTIL entered the coronavirus pandemic and
resulting global downturn with moderate FFO net leverage of 2.1x at
end-2019 (2.2x on average in 2017-2019). Given the pandemic and
subsequent weaker performance, particularly in the Metallurgy and
EPC businesses, Fitch expects that FFO net leverage will average
3.5x in 2020-2021, exceeding its negative guideline of 3.0x.
However, Fitch notes that this is also the result of the EUR300
million additional capital spending for the construction of the new
CCGT power plant, which will enter the grid in 2022 and provide
sizeable stable cash flows.

Fitch expects MYTIL's net leverage to be comfortably below its 3.0x
negative sensitivity in 2022 after the bulk of the power plant
capex and market conditions normalise.

Aluminium Prices under Pressure: The current three-month LME
aluminium price is trading short of USD1,600/t, a reduction of
around 12% from the 2019 average price. Fitch has revised its
aluminium price assumptions down for the second time this year and
it now expects 2020 and 2021 LME prices to average USD1,560/t and
USD1,600/t, respectively. In its view, the risks are to the
downside. However, Fitch expects the company to benefit from lower
raw black material, gas and electricity prices, which should
support 2020-2021 Metallurgy margins.

Aluminium Demand Collapse: Fitch expects aluminium end-user demand,
which already experienced difficulties in 2019, to deteriorate due
to considerably lower economic activity amid COVID-19 lockdown
measures. Despite a gradual easing of the restrictions on movement
and business activities, industrial output remains heavily
depressed. Consumer sentiment has been significantly weakened and
Fitch does not expect any material recovery in the short term. At
the same time, growing capacity exacerbates the oversupplied
market.

Higher Capex/Negative FCF: The group has not scaled back its
material capex attributed to the new power plant, despite the
current economic environment. However, it has shifted part of this
capex to 2021 from 2020. The power plant is on track for hot
commissioning in January 2022 and will be put into commercial
operation in July 2022. As a result, Fitch expects the company to
be free cash flow negative in 2020-2021 before turning neutral in
2022 as market conditions normalise and the new power plant starts
providing incremental cash flows.

Limited M&A/Organic Growth Headroom: Fitch understands from
management that the company will continue expanding its business
profile with organic growth projects and small bolt-on
acquisitions. Although the final investment decision for a new
alumina refinery plant of around EUR400 million has been put on
hold, MYTIL is active in the bidding process of acquiring Domestic
Energy Producers Alliance (DEPA - natural gas supply company of
Greece).

MYTIL aims to maintain net debt-to-EBITDA below 3x, with temporary
deviations to accommodate possible acquisitions or heavy capex. In
its view, the company currently has minimal headroom in its 'BB'
rating to proceed with material spending on acquisitions and
related higher capex. Fitch would consider M&A an event risk and
would reflect them in the company's ratings as they occur.

Underperformance of Construction Business: In line with its
previous expectation, the margins at the construction business
(including solar parks sub-segment) declined in 2019. This was due
to the execution of less-profitable, albeit more sustainable
projects compared with historical years as well as the growing
presence in the lower margins solar business. As profitability of
solar projects is generally lower versus traditional construction
projects, the historical double-digit margins of this segment have
been diluted.

Fitch expects further decline in margins in 2020, similar to
MYTIL's Fitch-rated peers, and higher cash spending, driven by the
impact of coronavirus-related issues as most of the projects are
turn-key with fixed pricing.

New EPC Strategy Improves Margins: MYTIL is currently revising its
traditional EPC strategy in order to focus on more sustainable
projects (solid and liquid waste management, energy efficiency
projects) which should be more profitable due to their complexity.
This drives its view that the group will be able to improve its EPC
segment's profitability starting from 2021. Nevertheless, Fitch
expects lower order intake in 2020, driven by the impact of the
pandemic. This could constrain the group's revenue generation in
2020-2021 and reduce total backlog.

Expansion in Solar Power: In Fitch's view, the group's planned
expansion into solar power projects drives higher revenue
generation, has lower construction risk compared with traditional
gas-fired projects and creates new opportunities in the renewable
industry globally, which is primed for continued growth. However,
this expansion slightly erodes profitability as solar parks'
margins for third parties are usually lower - single digit range -
than gas-fired projects.

BOT Project Risk: The group started investing in
Build-Operate-Transfer solar power projects in 2019. These projects
are monetised once commissioned and usually have better
profitability than third-party solar parks construction contracts.
However, the execution of BOT projects drives higher working
capital volatility and is subject to the risk of sales delay. MYTIL
has stated that the capital exposure of these projects will not
exceed EUR200 million at any given time. The key mitigating point
is the strong underlying global demand. Fitch expects that the
group's higher exposure to solar business will support the group's
EBITDA from 2021.

Lower Gas Prices Provide Support: Fitch expects European gas prices
(TTF/NBP - USD2.5/mcf and USD3.75/mcf in 2020 and 2021,
respectively) to remain weak in the medium term due to a LNG supply
glut, excess production capacity, large gas volumes in European
storage and weak demand exacerbated by the coronavirus crisis.
Fitch expects low gas prices to materially improve MYTIL's spark
spreads and outweigh the expected double-digit electricity demand
decline in 2020.

The group benefits from its status as the largest Greek gas
importer and consumer with a domestic market share of around 40%
(as of March 2020) that enables the group to import gas at a
significant discount to wholesale Greek prices.

Diversified Business Profile/Synergistic Model: Fitch believes that
the group's operations across three sectors with distinctive
characteristics, including alumina and aluminium production (52% of
2019 EBITDA), power generation and supply (32% of 2019 EBITDA) as
well as EPC (16%), offer diversification and strengthen the overall
business profile. Furthermore, synergies created within the group's
diversified business units provide certain cost competitive
advantages. This has enabled the group to generate FFO margins over
12% over the last three years. Fitch expects margins to slightly
decline but remain competitive over the rating horizon mainly due
to weakening macroeconomic conditions.

Small-Scale and Vertically Integrated: MYTIL is a small-scale,
single-plant aluminium producer, which operates throughout the
value chain with bauxite mining, alumina refining and aluminium
smelting production. This provides some insulation against input
cost inflation. Its self-sufficiency in bauxite stood at about 30%
of its total alumina refining needs at end-2019. However, its
bauxite reserve life is low in comparison with EMEA peers and could
reduce integration into this raw material if additional reserves
are not mined. Its own alumina production covers more than 100% of
its aluminium smelter needs.

Low Unit-Cost Aluminium Business: CRU estimates that MYTIL's
alumina refinery and aluminium smelter are positioned in the first
quartile of the global cost curve. Fitch expects MYTIL's site to
remain cost-competitive, driven by self-sufficiency in alumina,
operating efficiencies created from the adjacent CHP plant,
in-house anode production, along with partial self-sufficiency in
bauxite.

The emphasis on cost control with the 2021 cost optimisation
programme is expected to provide around EUR70 million of cost
efficiencies; half of it as recurring EBITDA savings and the rest
as a one-off in 2020, which should partially mitigate the impact of
the COVID-19 disruption. The renewal of the electricity agreement
that supplies electricity for aluminium production beyond 2020 with
similar tariffs is key to maintaining its cost-competitiveness.

Growing Power Business Enhances Stability: Fitch deems MYTIL's
growing electricity business, which is characterised by low
cyclicality, as credit-positive. The company is the largest
domestic independent power producer and supplier. The
high-efficient gas-fired generation fleet and ability to source
natural gas at attractive terms position MYTIL's plants at the
front of the merit order. The group also holds a share of around
6.5% (as of March 2020) in the Greek electricity supply market,
which is dominated by the state-owned Public Power Corporation.

DERIVATION SUMMARY

Given the diversified nature of MYTIL's operations, Fitch compared
the group's separate business units with the most relevant
companies that operate in the metallurgy, utilities and EPC
industries.

Metallurgy: The group's metallurgy business, which is the core
EBITDA driver, benefits from a competitive cost base positioned in
the first quartile of the global aluminium cost curve, partial
self-sufficiency in bauxite, in-house anode production and a
captive power plant that produces steam for the alumina production.
However, its small scale in comparison with United Company RUSAL
Plc (B+/Stable) and Alcoa Corporation (BB+/Stable), single-asset
base and low exposure to value-added-products constrain the group's
business profile assessment.

EPC: MYTIL possesses a fairly strong position in the niche segment
of energy projects construction with a long track-record and
historically strong backlog, which provides revenue visibility over
the medium term. However, the business profile assessment remains
constrained by its small scale in comparison with Grupo Aldesa S.A.
(BB-/Stable), Webuild S.p.A. (BB/Negative), and by a rather
concentrated project portfolio and customer base and relatively
high exposure to developing markets with a higher-risk profile. The
expected expansion into solar power should improve the business
segment diversification and will provide the group with solid cash
generation once the projects are successfully delivered.

Power & Gas: MYTIL is the largest IPP in Greece and second-largest
power producer after the state-owned PPC. It operates high-quality
assets that are strongly positioned at the front end of the merit
order. Uncertainty regarding the regulatory framework and expected
material capex in 2020-2021 are key constraining factors. The group
is well-positioned in comparison with other EMEA utilities
operating in markets with a challenging regulation environment,
including EN+ GROUP IPJSC (B+/Stable), Energo-Pro a.s.
(BB-/Stable), Bulgarian Energy Holding EAD (BB/Stable), and Enel
Russia PJSC (BB+/Stable).

KEY ASSUMPTIONS

  - Fitch aluminium LME prices at USD1,560/tonne in 2020,
USD1,600/tonne in 2021, USD1,800/tonne in 2022 and USD1,900/tonne
in 2023.

  - USD/EUR exchange rate of 0.9 over the next four years.

  - Aluminium production gradually increases to 250kt in 2023.

  - Revenue drop by around 19% in 2020 driven by negative market
trends across every segments. Fitch expects rebound of revenue
growth by 30% in 2021.

  - EBITDA margins at 13%-14% on average during 2020-2023, due
mainly to weaker profitability of the metallurgy and EPC segments.

  - Increasing capex in 2020 - 2021, in line with management's
guidance, primarily reflecting the new power plant construction.

  - Stable dividends of EUR51 million per year, in line with 2019,
over the next fits years.

RATING SENSITIVITIES

Factors that could, individually or collectively, lead to positive
rating action/upgrade:

  - As the Outlook is Negative, positive rating action is unlikely
in the short term. However, FFO net leverage falling below 3.0x
would result in a revision of the Outlook to Stable.

  - FFO net leverage below 2.0x on a sustained basis may support
positive rating action.

  - Further increase in scale with higher contribution from the
less volatile power & gas segment could also support positive
rating action.

  - Sustained positive FCF could also be positive for the rating.

Factors that could, individually or collectively, lead to negative
rating action/downgrade:

  - FFO net leverage sustained above 3.0x

  - EBITDA margins below 10% on a sustained basis

  - Sustained negative FCF

  - Material debt-funded M&A

  - Evidence of contract or customer losses or weakening EPC
projects implementation leading to declining order backlog and
weakening EPC EBITDA margins to below 6%

BEST/WORST CASE RATING SCENARIO

International scale credit ratings of Non-Financial Corporate
issuers have a best-case rating upgrade scenario (defined as the
99th percentile of rating transitions, measured in a positive
direction) of three notches over a three-year rating horizon; and a
worst-case rating downgrade scenario (defined as the 99th
percentile of rating transitions, measured in a negative direction)
of four notches over three years. The complete span of best- and
worst-case scenario credit ratings for all rating categories ranges
from 'AAA' to 'D'. Best- and worst-case scenario credit ratings are
based on historical performance.

LIQUIDITY AND DEBT STRUCTURE

Comfortable Liquidity: As at end-2019, the group had EUR673 million
of Fitch-defined readily available cash that was more than
sufficient to cover its short-term debt repayments and expected
negative FCF of around EUR155 million in 2020. The group has a
favourable debt repayment profile - pro forma for the planned
redemption of the EUR300 million bond due 2022 by end-June 2020-
with minor scheduled maturities until November 2024, when its
EUR500 million senior unsecured bond matures. Available undrawn
credit facilities of around EUR120 million out of total EUR320
million as at end-April 2020 with maturity over one year provides
an additional cash buffer.

Exposure to Greek Financial System: Most of MYTIL's bank debt comes
from Greek financial institutions and about 47% of its readily
available cash at end-March 2020 was located within various Greek
banks, rated by Fitch at 'B-' and below. The Greek banking sector
faces significant asset-quality issues with an extremely high level
of non-performing loans. The Greek economy remains weak and Fitch
expects a significant GDP contraction due to the COVID-19 crisis,
which could complicate MYTIL's ability to receive debt financing.

SUMMARY OF FINANCIAL ADJUSTMENTS

Fitch reclassified around EUR6.6 million of depreciation of
right-of-use assets and around EUR2.4 million of interest on lease
liabilities as lease expenses, reducing Fitch-calculated EBITDA by
around EUR9 million in 2019.

Fitch adjusted debt as at end-2019 for factoring by EUR51.8
million.

Fitch adjusted debt as at end-2019 for pre-export financing by
EUR98.9 million.

Fitch also adjusted debt as at end-2019 by EUR17.8 million to
indicate actual amount outstanding to be redeemed.

Fitch has adjusted cash in the amount of 5% of revenue attributed
to EPC segment, which Fitch treats as not readily available for
debt repayment because of seasonal working-capital swings. Fitch
also adjusted cash for cash held in countries (Algeria, Ghana,
Egypt and Libya) with potential barriers to access by EUR6.6
million as at end-2019.

REFERENCES FOR SUBSTANTIALLY MATERIAL SOURCE CITED AS KEY DRIVER OF
RATING

The principal sources of information used in the analysis are
described in the Applicable Criteria.

ESG CONSIDERATIONS

The highest level of ESG credit relevance, if present, is a score
of 3. This means ESG issues are credit-neutral or have only a
minimal credit impact on the entity(ies), either due to their
nature or to the way in which they are being managed by the
entity(ies).




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I R E L A N D
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BARINGS EURO 2017-1: Fitch Puts B- on Class F Debt on Watch Neg.
----------------------------------------------------------------
Fitch Ratings has taken multiple rating actions on Barings Euro CLO
2017-1 B.V., including placing two junior tranches on Rating Watch
Negative.

Barings Euro CLO 2017-1 B.V.

  - Class A-1 XS1646517547; LT AAAsf; Affirmed

  - Class A-2 XS1646510963; LT AAAsf; Affirmed

  - Class B-1 XS1646511938; LT AAsf; Affirmed

  - Class B-2 XS1646512233; LT AAsf; Affirmed

  - Class C XS1646512829; LT Asf; Affirmed

  - Class D XS1646513553; LT BBBsf; Affirmed

  - Class E XS1646513983; LT BBsf; Rating Watch On

  - Class F XS1646514874; LT B-sf; Rating Watch On

TRANSACTION SUMMARY

Barings Euro CLO 2017-1 B.V. is a cash flow collateralised loan
obligation. Net proceeds from the issuance of the notes were used
to purchase a EUR450 million portfolio of mainly European leveraged
loans and high-yield bonds. The portfolio is managed by Barings
(U.K.) Limited (the investment manager). The reinvestment period is
scheduled to end in October 2021.

KEY RATING DRIVERS

Coronavirus Baseline Sensitivity Analysis

Fitch placed the junior tranches on RWN and revised the Outlook on
the class D notes to Negative from Stable as a result of a
sensitivity analysis it ran in light of the coronavirus pandemic.
It notched down the ratings for all assets with corporate issuers
with a Negative Outlook regardless of sectors. Fitch will update
the sensitivity scenarios in line with the view of its Leveraged
Finance team. Its analysis was based on a stable interest-rate
scenario but included the front-, mid- and back-loaded default
timing scenarios as outlined in Fitch's criteria.

The affirmations of the rest of the ratings reflect that the
respective tranche ratings can withstand the coronavirus baseline
sensitivity analysis. This supports the Stable Outlook on these
ratings.

Transaction Failing Several Tests

The transaction is in its reinvestment period and the portfolio is
actively managed by the collateral manager. As per the latest
trustee report, the transaction is failing all its tests in Fitch
weighted average rating factor, Fitch 'CCC' rated assets and single
obligor concentration of non-senior secured assets portfolio
profile. The transaction is also failing its reinvestment
overcollateralisation test, and the class D and class E
overcollateralisation tests.

'B-' Category Portfolio Credit Quality

Fitch assesses the average credit quality of obligors in the 'B-'
category.

High Recovery Expectations

Nearly 94.1% of the assets are reported as senior secured
obligations. Fitch views the recovery prospects for these assets as
more favourable than for second-lien, unsecured and mezzanine
assets. The Fitch weighted average recovery rate of the current
portfolio is 64.1%.

Diversified Portfolio Composition

The portfolio is well-diversified across obligors, countries and
industries. Exposure to the top-10 obligors is 16.59% and no
obligor represents more than 1.94% of the portfolio balance. The
largest industry is computer and electronics at 10.94% of the
portfolio balance, followed by business services at 9.53% and
healthcare at 8.58%.

Cash Flow Analysis

Fitch used a customised proprietary cash flow model to replicate
the principal and interest waterfalls and the various structural
features of the transaction, as well as to assess their
effectiveness, including the structural protection provided by
excess spread diverted through the par value and interest coverage
tests. The transactions were modelled using the current portfolio
and the current portfolio with a coronavirus sensitivity analysis
applied.

When conducting cash flow analysis, Fitch's model first projects
the portfolio's scheduled amortisation proceeds and any prepayments
for each reporting period of the transaction life assuming no
defaults (and no voluntary terminations, when applicable). In each
rating stress scenario, such scheduled amortisation proceeds and
prepayments are then reduced by a scale factor equivalent to the
overall percentage of loans that are not assumed to default (or to
be voluntarily terminated, when applicable). This adjustment avoids
running out of performing collateral due to amortisation and
ensures all of the defaults projected to occur in each rating
stress are realised in a manner consistent with Fitch's published
default timing curve.

RATING SENSITIVITIES

Factors that could, individually or collectively, lead to positive
rating action/upgrade:

At closing, Fitch used a standardised stress portfolio (Fitch's
Stress Portfolio) that is customised to the specific portfolio
limits for the transaction as specified in the transaction
documents. Even if the actual portfolio shows lower defaults and
smaller losses (at all rating levels) than the Fitch's Stressed
Portfolio assumed at closing, an upgrade of the notes during the
reinvestment period is unlikely, given the portfolio's credit
quality may still deteriorate, not only by natural credit
migration, but also by reinvestments. After the end of the
reinvestment period, upgrades may occur in case of
better-than-expected portfolio credit quality and deal performance,
leading to higher credit enhancement and excess spread available to
cover for losses on the remaining portfolio.

Factors that could, individually or collectively, lead to negative
rating action/downgrade:

Downgrades may occur if the build-up of the credit enhancement
following amortisation does not compensate for a larger loss
expectation than initially assumed, due to unexpectedly high levels
of defaults and portfolio deterioration. As the disruptions to
supply and demand due to coronavirus for other vulnerable sectors
become apparent, loan ratings in such sectors would also come under
pressure. Fitch will resolve the RWN over the coming months as and
when its Leveraged Finance team takes the anticipated actions and
change the ratings and/or Recovery Ratings.

In addition to the baseline scenario, Fitch has defined a downside
scenario for the current crisis, where by all ratings in the 'B'
category would be downgraded by one notch and recoveries would be
lower by a haircut factor of 15%. For typical European CLOs this
scenario results in a category rating change for all ratings.

BEST/WORST CASE RATING SCENARIO

International scale credit ratings of Structured Finance
transactions have a best-case rating upgrade scenario (defined as
the 99th percentile of rating transitions, measured in a positive
direction) of seven notches over a three-year rating horizon; and a
worst-case rating downgrade scenario (defined as the 99th
percentile of rating transitions, measured in a negative direction)
of seven notches over three years. The complete span of best- and
worst-case scenario credit ratings for all rating categories ranges
from 'AAAsf' to 'Dsf'. Best- and worst-case scenario credit ratings
are based on historical performance.

USE OF THIRD-PARTY DUE DILIGENCE PURSUANT TO SEC RULE 17G -10

Form ABS Due Diligence-15E was not provided to Fitch in relation to
this rating action.

DATA ADEQUACY

The majority of the underlying assets or risk-presenting entities
have ratings or credit opinions from Fitch and/or other Nationally
Recognised Statistical Rating Organisations and/or European
Securities and Markets Authority-registered rating agencies. Fitch
has relied on the practices of the relevant groups within Fitch
and/or other rating agencies to assess the asset portfolio
information.

Overall, Fitch's assessment of the asset pool information relied
upon for the agency's rating analysis according to its applicable
rating methodologies indicates that it is adequately reliable.

REFERENCES FOR SUBSTANTIALLY MATERIAL SOURCE CITED AS KEY DRIVER OF
RATING

The principal sources of information used in the analysis are
described in the Applicable Criteria.


CITYJET: 57 Pilots Facing Redundancy Amid Examinership
------------------------------------------------------
BreakingNews.ie reports that 57 Dublin-based CityJet pilots have
been told they are facing redundancy.

They staged a protest at the airline's headquarters in Swords,
Dublin on June 23, BreakingNews.ie relates.

According to BreakingNews.ie, the pilots are accusing CityJet of
"offshoring" their jobs, but the airline says that is "grossly
misleading".

A statement says that around 20 pilots of the CRJ type aircraft
have been offered full-time posts in Copenhagen, BreakingNews.ie
notes.

The company is in examinership after contracts with Aer Lingus, Air
France and Brussels Airlines were cancelled, BreakingNews.ie
states.

Forsa Trade Union Official Ian McDonnell says the redundancies here
come despite pilots offering to take a temporary 50% wage cut,
BreakingNews.ie relays.

CityJet is an Irish regional airline with headquarters in Swords,
Dublin.


GOLDENTREE LOAN 4: Fitch Gives 'B-(EXP)sf' Rating on Class F Notes
------------------------------------------------------------------
Fitch Ratings has assigned GoldenTree Loan Management EUR CLO 4 DAC
expected ratings.

The assignment of final ratings is contingent on the receipt of
final documents conforming to information already received.

GoldenTree Loan Management EUR CLO 4 DAC

  - Class A; LT AAA(EXP)sf Expected Rating   

  - Class B-1; LT AA(EXP)sf Expected Rating   

  - Class B-2; LT AA(EXP)sf Expected Rating   

  - Class C; LT A(EXP)sf Expected Rating   

  - Class D; LT BBB-(EXP)sf Expected Rating   

  - Class E; LT BB-(EXP)sf Expected Rating   

  - Class F; LT B-(EXP)sf Expected Rating   

- Sub-notes; LT NR(EXP)sf Expected Rating   

TRANSACTION SUMMARY

GoldenTree Loan Management EUR CLO 4 DAC is a securitisation of
mainly senior secured obligations (at least 90%) with a component
of corporate rescue loans, senior unsecured, mezzanine, second-lien
loans and high-yield bonds. Net proceeds from the expected notes
will be used to fund a portfolio with a target par of EUR375
million. The portfolio is managed by GoldenTree Loan Management II,
LP. The collateralised loan obligation envisages a one-year
reinvestment period and a 6.5-year weighted average life.

KEY RATING DRIVERS

'B'/'B-' Portfolio Credit Quality: Fitch places the average credit
quality of obligors to in the 'B'/'B-' range. The Fitch weighted
average rating factor of the identified portfolio is 33.37

High Recovery Expectations: At least 90% of the portfolio comprises
senior secured obligations. Recovery prospects for these assets are
typically more favourable than for second-lien, unsecured and
mezzanine assets. The Fitch weighted average recovery rating of the
identified portfolio is 66.98%.

Diversified Asset Portfolio: The covenanted maximum exposure to the
top 10 obligors or assigning the expected ratings is 20% of the
portfolio balance. The transaction also includes limits on maximum
industry exposure based on Fitch industry definitions. The maximum
exposure to the three largest (Fitch-defined) industries in the
portfolio is covenanted at 40%. These covenants ensure that the
asset portfolio will not be exposed to excessive concentration.

Portfolio Management: The transaction features a one-year
reinvestment period and includes reinvestment criteria similar to
other European transactions. Fitch's analysis is based on a
stressed-case portfolio with the aim of testing the robustness of
the transaction structure against its covenants and portfolio
guidelines.

Cash-flow Analysis: Fitch used a customised proprietary cash flow
model to replicate the principal and interest waterfalls and the
various structural features of the transaction, and to assess their
effectiveness, including the structural protection provided by
excess spread diverted through the par value and interest coverage
tests.

RATING SENSITIVITIES

Factors that could, individually or collectively, lead to positive
rating action/upgrade:

  - A 125% default multiplier applied to the portfolio's mean
default rate, and with this subtracted from all rating default
levels, and a 25% increase of the recovery rate at all rating
recovery levels, would lead to an upgrade of up to five notches for
the rated notes, except for the class A notes as their ratings are
at the highest level on Fitch's scale and cannot be upgraded.

The transaction features a reinvestment period and the portfolio is
actively managed. At closing, Fitch will use a standardised stress
portfolio (Fitch's stressed portfolio) that is customised to the
specific portfolio limits for the transaction as specified in the
transaction documents. Even if the actual portfolio shows lower
defaults and smaller losses (at all rating levels) than Fitch's
stressed portfolio assumed at closing, an upgrade of the notes
during the reinvestment period is unlikely, as the portfolio credit
quality may still deteriorate, not only through natural credit
migration, but also through reinvestments.

After the end of the reinvestment period, upgrades may occur in
case of a better-than-initially expected portfolio credit quality
and deal performance, leading to higher credit enhancement for the
notes and excess spread available to cover for losses on the
remaining portfolio.

Factors that could, individually or collectively, lead to negative
rating action/downgrade:

A 125% default multiplier applied to the portfolio's mean default
rate, and with the increase added to all rating default levels, and
a 25% decrease of the recovery rate at all rating recovery levels,
would lead to a downgrade of up to six notches for the rated
notes.

Downgrades may occur if the build-up of credit enhancement
following amortisation does not compensate for larger loss
expectation than initially assumed due to an unexpectedly high
level of default and portfolio deterioration. As the disruptions to
supply and demand due to COVID-19 become apparent for other
vulnerable sectors, loan ratings in those sectors would also come
under pressure. Fitch will update the sensitivity scenarios in line
with the views of its Leveraged Finance team.

Coronavirus Baseline Scenario Impact: Fitch carried out a
sensitivity analysis on the target portfolio to envisage the
coronavirus baseline scenario. The agency notched down the ratings
for all assets with corporate issuers on Negative Outlook
regardless of sector. This scenario shows the resilience of the
assigned ratings, with substantial cushion across rating
scenarios.

In addition to the baseline scenario, Fitch has defined a downside
scenario for the current crisis, whereby all ratings in the 'Bsf'
category would be downgraded by one notch and recoveries would be
lower by a haircut factor of 15%. This scenario results in a
downgrade for the rated notes of up to six notches.

BEST/WORST CASE RATING SCENARIO

International scale credit ratings of Structured Finance
transactions have a best-case rating upgrade scenario (defined as
the 99th percentile of rating transitions, measured in a positive
direction) of seven notches over a three-year rating horizon; and a
worst-case rating downgrade scenario (defined as the 99th
percentile of rating transitions, measured in a negative direction)
of seven notches over three years. The complete span of best- and
worst-case scenario credit ratings for all rating categories ranges
from 'AAAsf' to 'Dsf'. Best- and worst-case scenario credit ratings
are based on historical performance.

USE OF THIRD-PARTY DUE DILIGENCE PURSUANT TO SEC RULE 17G -10

Form ABS Due Diligence-15E was not provided to, or reviewed by,
Fitch in relation to this rating action.

DATA ADEQUACY

Most of the underlying assets have ratings or credit opinions from
Fitch and/or other Nationally Recognised Statistical Rating
Organisations and/or European Securities and Markets
Authority-registered rating agencies.

Fitch has relied on the practices of the relevant groups within
Fitch and/or other rating agencies to assess the asset portfolio
information.

Overall, Fitch's assessment of the asset pool information relied on
for the agency's rating analysis according to its applicable rating
methodologies indicates that it is adequately reliable.

REFERENCES FOR SUBSTANTIALLY MATERIAL SOURCE CITED AS KEY DRIVER OF
RATING

The principal sources of information used in the analysis are
described in the Applicable Criteria.


MADISON PARK VII: Fitch Puts B- on Class F Debt on Watch Neg.
-------------------------------------------------------------
Fitch Ratings has taken rating actions on Madison Park Euro Funding
VII B.V., as detailed below.

Madison Park Euro Funding VII B.V.

  - Class A XS1822369184; LT AAAsf; Affirmed

  - Class B-1 XS1822369697; LT AAsf; Affirmed

  - Class B-2 XS1823155673; LT AAsf; Affirmed

  - Class B-3 XS1823156994; LT AAsf; Affirmed

  - Class C-1 XS1822370190; LT Asf; Affirmed

  - Class C-2 XS1823157968; LT Asf; Affirmed

  - Class D XS1822370786; LT BBBsf; Affirmed

  - Class E XS1822371321; LT BBsf; Rating Watch On

  - Class F XS1822372055; LT B-sf; Rating Watch On

TRANSACTION SUMMARY

Madison Park Euro Funding VII B.V. is a securitisation of mainly
senior secured obligations (at least 90%) with a component of
senior unsecured, mezzanine and second-lien loans. The transaction
is still within its reinvestment period and is actively managed by
the collateral manager.

KEY RATING DRIVERS

Portfolio Performance Deteriorates:

The Rating Watch Negative reflects the deterioration in the
portfolio as a result of the negative rating migration of the
underlying assets in light of the coronavirus pandemic. In
addition, as per the trustee report dated May 14, 2020, the
transaction is below par by around 140bp. The trustee-reported
Fitch weighted average rating factor of 35.42 is in breach of its
test, and the Fitch-calculated WARF of the portfolio increased to
37.57 on June 13, 2020.

Asset Credit Quality

'B'/'B-' Category Portfolio Credit Quality: Fitch assesses the
average credit quality of obligors to be in the 'B'/'B-' category.
The Fitch WARF of the current portfolio is 37.57.

Asset Security

High Recovery Expectations: Senior secured obligations comprise
97.38% of the portfolios. Fitch views the recovery prospects for
these assets as more favourable than for second-lien, unsecured and
mezzanine assets. The Fitch's weighted average recovery rate of the
current portfolio is 63.71%.

Portfolio Composition

The portfolios are well diversified across obligors, countries and
industries. The top 10 obligor's exposure is 13.53% and no obligor
represents more than 1.81% of the portfolio balance. The largest
industry is business services at 11.86% of the portfolio balance,
followed by chemicals at 9.63% and healthcare at 9.38%.

Cash Flow Analysis

Fitch used a customised proprietary cash flow model to replicate
the principal and interest waterfalls and the various structural
features of the transaction, as well as to assess their
effectiveness, including the structural protection provided by
excess spread diverted through the par value and interest coverage
tests. The transaction was modelled using the current portfolio
based on both the stable and rising interest rate scenario and the
front, mid- and back-loaded default timing scenario as outlined in
Fitch's criteria. In addition, Fitch tested the portfolio with a
coronavirus sensitivity analysis to estimate the resilience of the
notes' ratings. The analysis for the portfolio with a coronavirus
sensitivity analysis was only based on the stable interest rate
scenario including all default timing scenarios.

When conducting its cash flow analysis, Fitch's model first
projects the portfolio scheduled amortisation proceeds and any
prepayments for each reporting period of the transaction life
assuming no defaults (and no voluntary terminations, when
applicable). In each rating stress scenario, such scheduled
amortisation proceeds and prepayments are then reduced by a scale
factor equivalent to the overall percentage of loans that are not
assumed to default (or to be voluntary terminated, when
applicable). This adjustment avoids running out of performing
collateral due to amortisation and ensures all of the defaults
projected to occur in each rating stress are realised in a manner
consistent with Fitch's published default timing curve.

RATING SENSITIVITIES

Factors that could, individually or collectively, lead to positive
rating action/upgrade:

The transaction features a reinvestment period and the portfolio is
actively managed. At closing, Fitch uses a standardised stress
portfolio (Fitch's Stressed Portfolio) that is customised to the
specific portfolio limits for the transaction as specified in the
transaction documents. Even if the actual portfolio shows lower
defaults and losses (at all rating levels) than Fitch's Stressed
Portfolio assumed at closing, an upgrade of the notes during the
reinvestment period is unlikely, given the portfolio credit quality
may still deteriorate, not only by natural credit migration, but
also by reinvestments. After the end of the reinvestment period,
upgrades may occur in case of a better than initially expected
portfolio credit quality and deal performance, leading to higher
credit enhancement for the notes and excess spread available to
cover for losses on the remaining portfolio.

Factors that could, individually or collectively, lead to negative
rating action/downgrade:

Downgrades may occur if the build-up of credit enhancement for the
notes following amortisation does not compensate for a higher loss
expectation than initially assumed due to an unexpectedly high
level of default and portfolio deterioration. As the disruptions to
supply and demand due to the coronavirus for other sectors become
apparent, loan ratings in such sectors would also come under
pressure. Fitch will resolve the RWN status over the coming months
as it observes rating actions on the underlying loans.

Fitch carried out a sensitivity analysis on the target portfolio to
envisage the coronavirus baseline scenario. It notched down the
ratings for all assets with corporate issuers on Negative Outlook
regardless of sector. This scenario shows the resilience of the
current ratings with cushions, except for the class D, E and F
notes, which show sizeable shortfalls.

In addition to the base scenario, Fitch has defined a downside
scenario for the current coronavirus crisis, whereby all ratings in
the 'B' category would be downgraded by one notch and recoveries
would be lowered by 15%. For typical European CLOs this scenario
results in a rating category change for all ratings.

BEST/WORST CASE RATING SCENARIO

International scale credit ratings of Structured Finance
transactions have a best-case rating upgrade scenario (defined as
the 99th percentile of rating transitions, measured in a positive
direction) of seven notches over a three-year rating horizon; and a
worst-case rating downgrade scenario (defined as the 99th
percentile of rating transitions, measured in a negative direction)
of seven notches over three years. The complete span of best- and
worst-case scenario credit ratings for all rating categories ranges
from 'AAAsf' to 'Dsf'. Best- and worst-case scenario credit ratings
are based on historical performance.

USE OF THIRD-PARTY DUE DILIGENCE PURSUANT TO SEC RULE 17G -10

Form ABS Due Diligence-15E was not provided to, or reviewed by,
Fitch in relation to this rating action.

DATA ADEQUACY

The majority of the underlying assets or risk-presenting entities
have ratings or credit opinions from Fitch and/or other nationally
recognised statistical rating organisations and/or European
Securities and Markets Authority registered rating agencies. Fitch
has relied on the practices of the relevant groups within Fitch
and/or other rating agencies to assess the asset portfolio
information.

Overall, Fitch's assessment of the asset pool information relied
upon for its rating analysis according to its applicable rating
methodologies indicates that it is adequately reliable.




=========
I T A L Y
=========

CENTURION BIDCO: Moody's Assigns B2 CFR, Outlook Stable
-------------------------------------------------------
Moody's Investors Service assigned a corporate family rating of B2
and a probability of default rating of B2-PD to Centurion Bidco
S.p.A. Concurrently, Moody's has assigned a B2 rating to the
proposed EUR640 million senior secured notes due 2026 raised by
Centurion Bidco S.p.A. The outlook on the ratings is stable.

The proceeds from the notes will be used to finance the proposed
acquisition of Engineering -- Ingegneria Informatica S.p.A. by
Centurion Bidco S.p.A., the refinancing of certain target
indebtedness and for related fees and expenses.

"Engineering is positioned at the higher end of the B2 rating
category, reflecting its solid track record of organic revenue and
EBITDA growth, which we expect will continue given the attractive
characteristics of the Italian IT service market and the company's
strong positioning among its local peers" said Fabrizio Marchesi,
Vice President and Moody's lead analyst for the company. "That
said, the rating also reflects concerns about the company's limited
geographic diversification and significant customer concentration,
and whether Engineering would look to refinance the PIK notes
issued by its parent in the future, which would delay deleveraging"
added Mr. Marchesi.

RATINGS RATIONALE

Engineering's B2 CFR is supported by (1) its leading player status
and strong technical know-how; (2) an attractive Italian IT market
with significant medium-term growth potential; (3) relatively high
switching costs for its services as well as good customer retention
overall; (4) expectations that Engineering will be resilient to the
coronavirus-related economic downturn and generate healthy growth
from 2021 onwards given positive secular trends in IT spending; and
(5) forecast Moody's adjusted free cash flow (FCF) generation above
5% of total Moody's adjusted debt.

Conversely, the CFR is constrained by (1) Engineering's limited
geographic diversification and significant customer concentration;
(2) strong competition in the Italian IT services mark (3) the
company's limited track record of growth in cash flow generation;
(4) risks associated with Engineering's large net working capital
position; and (5) the possibility of delayed deleveraging due to
debt-funded acquisitions or shareholder-friendly actions, including
a repayment of the PIK notes issued outside the Centurion Bidco
S.p.A. restricted group.

Moody's expects that Engineering will continue to grow revenue and
EBITDA over the medium-term, following weaker demand for IT
services in 2020 because of a coronavirus-induced slowdown. On an
organic basis, the rating agency forecasts revenue will decline by
2-3% in 2020, followed by recovery towards 6% annual growth from
2021 onwards. At the same time, the rating agency anticipates that
management will successfully deliver cost savings, which will help
limit the impact on Moody's adjusted EBITDA in 2020 and help
sustain an improvement towards EUR180 million in 2021. Moody's
adjusted leverage is expected to gradually decline towards 4.5x in
2021, from 5.3x at close, though the speed of deleveraging is
dependent on management's acquisition strategy and whether it
pursues shareholder-friendly actions, including repayment of the
PIK notes raised at Centurion Newco S.p.A.

Engineering's cash flow generation is expected to remain healthy,
with the company generating EUR40-50 million of Moody's adjusted
FCF per year, equivalent to 5% of Moody's adjusted debt. That said,
the company has a limited track record of improving its cash flow
and considers that a lack of improvement in Moody's adjusted FCF
from current levels would likely constrain an improvement in
Engineering's CFR going forward. The rating agency also notes that
the large size of the company's net working capital position,
characterized by significant long-dated receivables and a certain
number of overdue receivables, could be a source of risk with
regards to cash conversion going forward.

Moody's regards the coronavirus outbreak as a social risk under its
ESG framework, given the substantial implications for public health
and safety. The action also reflects the impact of the breadth and
severity of the shock, as well as the expected impact on the credit
quality of the company.

Funds advised and ultimately controlled by Bain Capital and
Neuberger Berman own 100% of the share capital of the company. As
is often the case in highly levered, private equity sponsored
deals, the owners can have a high tolerance for leverage/risk and
governance is less transparent when compared to publicly-traded
companies.

LIQUIDITY

Moody's considers Engineering's liquidity to be good and supported
by (1) a pro forma starting cash balance of EUR49 million, (2)
access to a fully undrawn EUR160 million revolving credit facility
(RCF) at closing of the transaction, and (3) expected Moody's
adjusted FCF generation of at least EUR40 million per year.

Moody's does not expect that the company will draw on its RCF, but,
in the event that it does, Moody's anticipates ample headroom
against the springing net leverage covenant which is set at 1.7x
when the RCF is drawn by more than 40%.

STRUCTURAL CONSIDERATIONS

The proposed capital structure includes EUR640 million senior
secured notes due 2026, as well as a EUR160 million super-senior
revolving credit facility (RCF) also due in 2026. The security
package provided to the senior secured lenders is limited to
pledges over shares, bank accounts, and intercompany receivables.

The B2 rating assigned to the proposed senior secured notes is in
line with the CFR, reflecting the significant size of the
super-senior RCF as well as the large number of payables that
characterize the company's business model. The B2-PD probability of
default rating is at the same level as the CFR, reflecting its
assumption of a 50% family recovery rate.

RATING OUTLOOK

The stable outlook reflects Moody's expectation of (1) a limited
impact from the coronavirus outbreak and related economic downturn;
(2) continued growth in revenue and stable EBITDA margin over the
medium term; (3) no material releveraging from opening levels from
any future acquisitions, debt refinancing or shareholder
distributions; (4) ongoing cash flow generation equivalent to
annual Moody's adjusted FCF in the mid-single digits as a
percentage of Moody's adjusted debt; and (5) an adequate liquidity
profile.

FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS

Positive pressure could arise if (1) Engineering continues to
increase its size and scale (2) the company's Moody's-adjusted
(gross) leverage ratio falls below 4.5x on a sustained basis while
delivering solid operating performance, including the smooth
integration of bolt-on acquisitions; (3) Engineering maintains a
strong liquidity profile, including an improvement in Moody's
adjusted FCF generation towards high single-digits as a percentage
of Moody's adjusted debt.

Engineering is positioned at the higher end of the B2 rating
category. However, negative pressure could arise if (1) its revenue
and EBITDA came under pressure, including if there was a sustained
deterioration in the market or competitive environment; (2) the
company's Moody's-adjusted (gross) leverage rises above 6.0x on a
sustained basis, due to financial underperformance, additional debt
raised to fund acquisitions or shareholder-friendly actions,
including the refinancing of the EUR216.5 million PIK Notes raised
by Engineering's parent; or (3) its free cash flow generation and
liquidity profile were to deteriorate.

PRINCIPAL METHODOLOGY

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

Founded in 1980, and headquartered in Rome, Engineering is a
leading provider of IT services, software development and digital
platforms, supporting clients in their digital transformation
projects. The company provides software and IT related services and
consultancy to companies in a diverse set of sectors including
telecommunications, utilities, financials and public
administration. In 2019, the company recorded revenue of EUR1.3
billion, 86% of which was generated in Italy, and company-adjusted
EBITDA of EUR160 million (EUR180 million including the impact of
IFRS 16).




===================
K A Z A K H S T A N
===================

FREEDOM FINANCE: S&P Affirms 'B-/B' ICRs, Outlook Stable
--------------------------------------------------------
S&P Global Ratings affirmed its 'B-/B' long- and short-term issuer
credit ratings on Freedom Finance JSC and IC Freedom Finance LLC.
The outlook is stable.

At the same time, S&P affirmed its 'kzBB-' Kazakhstan national
scale ratings on Freedom Finance JSC.

The gradual sale of Freedom Finance JSC's proprietary position in
Kazakhstani equities over the past 12 months has resulted in a
pronounced increase in the group's capitalization. S&P said, "Our
risk-adjusted capital (RAC) ratio improved to 9% by year-end 2019
from 7.0% at March 31, 2019. We expect that further equities sales
may add about 140 basis points to this ratio by mid-year 2020." The
group has also considerably beefed up its earnings capacity, both
through higher demand for brokerage services in Russia and higher
interaction with FFIN Brokerage Services Ltd., a Belize-based
broker under common control.

S&P said, "Nevertheless, we believe that over the next 12 months
the group will largely utilize spare capital to acquire financial
companies in Russia and Kazakhstan. We also understand that the
acquisition of Freedom Life and Freedom Insurance, two insurance
companies in Kazakhstan owned by the group's key shareholder Timur
Turlov, will be a cash-out deal. As a result, we believe RAC will
be in the 8.5%-9.0% range in the next 12 months. Moreover, we
believe that some upcoming acquisitions may expose the group to
integration risk."

The reduced proprietary position in equities and lower reliance on
money market funding have resulted in improved liquidity for both
Freedom Finance JSC and the overall group. This is seen in the
stronger liquidity coverage metric for Freedom Holding Corp. of
about 2.2x as of Dec. 31, 2019, compared with 1.5x as of March 31,
2019.

S&P said, "We also note that, over the past 12 months, the volume
of operations in Russia and the group's Russian clientele have
increased considerably. Therefore, while previously we thought that
group's activities were evenly balanced between Russia and
Kazakhstan, we now view it as more Russia-centered. However, this
does not affect the group anchor.

"The stable outlook balances our view of Freedom group's improving
risk profile with its appetite for large transactions and
nonorganic growth.

"A positive rating action may follow if we see that acquired
businesses are successfully integrated and the group proves its
ability to manage transformation changes and contains its risk
appetite. A stable funding and liquidity profile as well as a RAC
ratio comfortably in excess of 5% are a prerequisite for an
upgrade.

"A negative rating action may follow if we see that the group's
appetite for proprietary investments puts sizeable pressure on its
capitalization or funding profile though higher reliance on
money-market facilities to fund longer-term assets."


OIL INSURANCE: S&P Affirms 'B+' LongTerm ICR, Outlook Stable
------------------------------------------------------------
S&P Global Ratings affirmed its 'B+' long-term insurer financial
strength and issuer credit ratings on Kazakhstan-based insurer Oil
Insurance Co. (NKS). The outlook is stable. At the same time, S&P
affirmed its 'kzBBB' Kazakhstan national scale rating on NSK.

S&P affirmed its ratings on NSK because it believes that the
company will be able to keep its competitive position as a midsize
player on the Kazakhstan P/C insurance market and maintain its
capitalization at the current level, despite the tightening
operating environment and the higher-than-expected dividends paid
in April 2020.

NSK's market share has been gradually increasing since the
temporary restrictions on its licenses for compulsory insurance and
inward reinsurance lines were lifted at the end of 2018. As of
end-2019, NSK ranked No.5 by gross premium written (GPW) in
Kazakhstan's P/C insurance sector with a market share of 4.3% (No.7
by GPW and 4.2% market share in 2018). The company continues to
focus on the motor segment, which accounted for about 51% of its
GPW in 2019. In addition, the company writes medical and personal
accident (26% of GPW in 2019), property (8% of GPW in 2019), and
liability (5% of GPW in 2019) insurance, with other lines
accounting for the remaining 10% of GPW in 2019. S&P expects the
portfolio structure to remain stable.

S&P said, "We expect that NSK's premium growth will be muted in
2020, due to the lower demand for insurance in the context of
COVID-19 containment measures and economic contraction in
Kazakhstan by our forecast of about 3% in 2020. In addition, we
consider that the company's combined (loss and expense) ratio may
increase to around 105% this year. In particular, we believe that
the company's claims ratio may increase in those lines of business
where claims payments are linked to foreign currency, such as the
motor segment. A significant share of spare car parts are imported,
pushing up the local currency cost of repairs, given that the
Kazakhstani tenge (KZT) depreciated by 7.6% over the first five
months of 2020. That said, we think that NSK is following
reasonable underwriting standards and we expect a gradual
improvement of operating profitability in 2021-2022 once the
economic environment improves.

"We expect that NSK will be able to sustain its capitalization at
the current level despite significant dividend payments of KZT1.2
billion in April 2020 and weaker technical results than we expected
previously. We understand that the shareholders' demand for
dividends in 2019-2020 was linked to the financing of the
acquisition of the company's shares last year. Our future forecast
of capital adequacy implies that we do not expect future dividends
to be as high, close to 50% of net income in 2021-2022. According
to our capital model, the company's total adjusted capital was 2%
redundant at the 'BBB' level on Dec. 31, 2019, and we expect it to
remain in the same category (2019 already accounts for dividends
paid in April 2020). The company's solvency ratio was 1.74x as of
June 1, 2020, after dividend payout, comfortably above the minimum
required level of 1x. That said, the company's capital in absolute
size continues to be significantly smaller than international
peers' (KZT4.8 billion, or about US$12.6 million, at the end of
2019), which makes it more vulnerable to external shocks. Even if
we see gradual improvements of the company's capital adequacy under
our capital model, the absolute size of capital will continue
limiting our overall assessment of capital and earnings until it
exceeds the equivalent of US$25 million, which we think will happen
beyond our two-year rating horizon.

"We see positively that the company is gradually improving the
weighted-average credit quality of its investment portfolio, which
is in line with market trends for other players on the market. Most
of the company's investments (71% on April 1, 2020) comprise
Kazakhstan government bonds and bonds and deposits of Kazakhstan's
systemically important banks and government-related entities.
Investment-grade instruments represented around 53% of the
company's total investments on the same date (43% a year
previously).

"We believe that NSK has sufficient liquidity to meet its
obligations in a stress scenario. Our liquidity ratio stood at 162%
at the end of 2019 and we expect it will remain above 150% in the
next 12 months.

"We currently consider the company's governance as a neutral factor
for the rating. However, we will monitor further the company's
system of checks and balances. We think that while the company's
capital buffers seem sufficient currently, the decision to pay high
dividends in the tightening operating environment could constrain
the company's ability to absorb unexpected risks.

"The stable outlook reflects our expectation that in the next 12
months NSK will be able to sustain its market share and maintain
its current capital adequacy, complying with regulatory capital
requirements, despite the pressure from the tightening operating
environment in Kazakhstan's P/C insurance market in view of
COVID-19 containment measures and expected economic contraction. We
also expect the insurer to maintain its conservative investment
policy."

S&P could lower our ratings in the next 12 months if NSK's:

-- Capital deteriorated for a prolonged period below the 'BBB'
level according to S&P's capital model, squeezed either by
weaker-than-expected operating performance, very high premium
growth, investment losses, or higher-than-expected dividend
payouts; or

-- S&P observed weakening of the company's governance procedures;
or

-- The company's competitive position weakened, as shown, for
example, by a material decline in premium volumes signifying loss
of market share.

S&P sees a positive rating action in the next 12 months as remote,
taking into account the company's weak business risk profile,
volatile operating performance, and low capital in absolute terms.




=========
M A L T A
=========

FIMBANK PLC: Fitch Affirms B+ LongTerm IDR, Outlook Negative
------------------------------------------------------------
Fitch Ratings has affirmed Fimbank Plc's Long-Term Issuer Default
Rating at 'B+' and Viability Rating at 'b+'. The Outlook is
Negative.

KEY RATING DRIVERS

IDRS AND VR

FIM's 'b+' VR, which drives the Long-Term IDR, reflects heightened
pressures on the bank's business model, weak asset-quality and
pressured profitability. The VR also reflects risks to
capitalisation from lower internal capital generation and increased
unserved non-performing assets. These factors are balanced by the
bank's relatively stable funding and liquidity profile, which has
remained reasonable since the start of the crisis, and the bank's
moderate trade finance franchise.

The Negative Outlook reflects its view that the economic and
financial-market fallout from the coronavirus outbreak creates
additional downside risks to FIM's business model stability,
strategy execution, asset quality, capitalisation and earnings.

Asset quality continued to deteriorate in 2019, despite
management's view that this would improve in the medium term. Fitch
calculates FIM's non-performing assets ratio (including on-and
off-balance sheet credit exposures) increased to 10% at end-2019
from 7% at end-2018. Impaired corporate exposures account for a
large share of NPA. NPA increases were primarily driven by
large-ticket impairments in commodity trade financing. In addition,
FIM's stage 2 customer loan exposures increased significantly to
about a quarter of the book at end-2019, from about a fifth at
end-2018 (although a low share was overdue).

The risk of further deterioration in asset quality is significant,
given its expectations of a severe downturn in the global economy
in 2020. This was evidenced by a relatively large, high-profile
exposure becoming problematic in 2Q20, which is expected to have
moderately increased FIM's NPAs.

FIM's profitability has come under pressure from increased
impairment charges and due to lower interest income as the bank has
followed a de-risking strategy. FIM's operating
profit/risk-weighted assets ratio weakened to a modest 0.5% in 2019
from 1.0% in 2018. Fitch does not expect profitability to
materially improve over the rating horizon as loan impairment
charges are likely to stay elevated, given continued asset quality
issues and low reserve coverage. Fitch expects FIM to record a
moderate loss in 2020 due to continued provisioning against
unreserved risks, new NPAs and declining business volumes.

Fitch considers FIM's capital ratios to be only adequate in light
of high asset quality risks, credit concentrations, weak capital
generation and the bank's small size (end-2019 CET1: USD263
million). The bank's CET1 ratio fell moderately to 16.9% at
end-2019, from 17.9% at end-2018, reflecting risk-weighted assets
growth and weak profitability. Its assessment of capital is also
negatively affected by FIM's high share of unreserved NPAs, which
amounted to 30% of CET1 at end-2019. Fitch expects the bank's
capital ratios to have moderately improved in 1Q20, from asset
deleveraging amid tougher operating conditions, and remain
moderately above regulatory requirements.

FIM is primarily funded by customer deposits (67% of non-equity
funding at end-2019), of which a large part is sourced in other EU
countries via third-party internet platforms. Fitch believes these
deposits are price-sensitive and potentially less stable. However,
they have remained broadly intact in recent years including since
the start of the coronavirus crisis, albeit with a higher cost.
Refinancing risks have also increased, given the change in creditor
sentiment and FIM's high share of bank borrowings (including
interbank deposits; about 24% of non-equity funding at end-2019).
These risks are mitigated to some extent by the generally
short-term nature of FIM's balance sheet, reflecting its trade
finance focus. FIM's liquidity coverage ratio was 125% at
end-2019.

SUPPORT RATING AND SUPPORT RATING FLOOR

The '5' Support Rating and 'No Floor' Support Rating Floor reflect
Fitch's view that support from the Maltese authorities cannot be
relied upon, given that Malta has adopted resolution legislation
that requires senior creditors to participate in losses and also
because of FIM's limited systemic importance. It also reflects its
view that although support from Burgan Bank (A+/Stable/bb) or FIM's
other shareholders, including the ultimate shareholder Kuwait
Projects Company (KIPCO, unrated), is possible, it cannot be relied
upon.

RATING SENSITIVITIES

Factors that could, individually or collectively, lead to negative
rating action/downgrade:

VR AND IDRS

The Long-Term IDR is sensitive to changes in FIM's VR. The bank's
above-average level of NPAs, weak profitability and modest
loss-absorption capacity mean the bank has only moderate rating
headroom in the face of the economic disruption posed by the
coronavirus outbreak. The VR could be downgraded in case of i)
continued increases in NPA inflows; ii) an expected sustained
reduction of operating profitability; iii) expected sustained
weakening in capital ratios, in particular in light of increased
unreserved NPAs; and iv) further downward revisions of Fitch's
expectations of FIM's operating environments.

Factors that could, individually or collectively, lead to positive
rating action/upgrade:

The Outlook could be revised to Stable if the disruption caused by
the pandemic proves to be short-lived and if FIM emerges from it
with an unscathed financial profile. Positive rating action would
require a strong and sustained improvement in asset quality, core
profitability and capitalisation.

Upward revision of the SRF would be contingent on a positive change
in the sovereign's propensity to support FIM, which is highly
unlikely in its view. FIM's SR is sensitive to changes in Fitch's
view on the propensity and ability of the bank's shareholders to
provide timely support to the bank. The SR could be upgraded if
Fitch believed that support from its owners became more likely and
reliable for example, if Burgan acquired a majority share in the
bank or if FIM evolved into a more strategic part of the group.

BEST/WORST CASE RATING SCENARIO

International scale credit ratings of Financial Institutions
issuers have a best-case rating upgrade scenario (defined as the
99th percentile of rating transitions, measured in a positive
direction) of three notches over a three-year rating horizon; and a
worst-case rating downgrade scenario (defined as the 99th
percentile of rating transitions, measured in a negative direction)
of four notches over three years. The complete span of best- and
worst-case scenario credit ratings for all rating categories ranges
from 'AAA' to 'D'. Best- and worst-case scenario credit ratings are
based on historical performance.

REFERENCES FOR SUBSTANTIALLY MATERIAL SOURCE CITED AS KEY DRIVER OF
RATING

The principal sources of information used in the analysis are
described in the Applicable Criteria.

ESG CONSIDERATIONS

The highest level of ESG credit relevance, if present, is a score
of 3. This means ESG issues are credit-neutral or have only a
minimal credit impact on the entity(ies), either due to their
nature or to the way in which they are being managed by the
entity(ies).




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

TRANSPORTES AEREOS: Moody's Lowers CFR to Caa2, Outlook Neg.
------------------------------------------------------------
Moody's Investors Service downgraded the Corporate Family and
Probability of Default rating of TRANSPORTES AEREOS PORTUGUESES,
S.A. to Caa2 from Caa1 and to Caa2-PD from Caa1-PD respectively.
Concurrently Moody's has also downgraded TAP's Baseline Credit
Assessment to caa3 from caa2 and the EUR375 million senior
unsecured notes to Caa2 from Caa1. The outlook on the ratings
remains negative.

The rating actions reflect:

  -- The increasing duration and severity of the coronavirus
outbreak

  -- Moody's expectation that the airline industry will remain
deeply constrained in 2020 and 2021 and will not recover 2019
passenger volumes until 2023 at the earliest

  -- The levered capital structure of TAP and hence weak
positioning in its rating categories prior to the outbreak of the
coronavirus

  -- The temporary liquidity relief offered by the EUR1.2 billion
6-month loan offered by the Portuguese government under the
European Commission's Rescue & Restructuring support framework

  -- The implementation risk of the restructuring programme that
TAP needs to develop and get approved by the European Commission
under the Rescue & Restructuring framework over the next six
months

  -- The company's strategic importance to the Portuguese economy
and expectation of its continued support

  -- Uncertainties regarding the execution of longer-term equity
recapitalization needs

RATINGS RATIONALE

The rapid and widening spread of the coronavirus outbreak,
deteriorating global economic outlook, falling oil prices, and
asset price declines are creating a severe and extensive credit
shock across many sectors, regions and markets. The combined credit
effects of these developments are unprecedented. The passenger
airline sector has been one of the sectors most significantly
affected by the shock given its exposure to travel restrictions and
sensitivity to consumer demand and sentiment. The action reflects
the impact on TAP of the breadth and severity of the shock, and the
broad deterioration in credit quality it has triggered.

While TAP was impacted later than other European carriers by the
coronavirus outbreak due to its absence of exposure to and from
China and Asia Pacific and other regions , it had in the meantime
to reduce capacity meaningfully as the virus moved to the west and
Moody's does not expect a material increase from those levels over
the next few weeks.

Moody's expects flight activity to resume over Q3 and Q4 of 2020,
but remaining severely depressed, with domestic flights recovering
earlier and a slower return for international and long-haul
flights. TAP has a high share of long-haul traffic but is less
exposed to business travel than some of its peers.

The International Air Transport Association (IATA) currently
forecasts that 2020 global passenger numbers will be 48% down
year-on-year, with 2021 volumes around 30% below 2019, and only
recovering to 2019 levels by 2023. Given high levels of uncertainty
of the trajectory of the pandemic there are a wide range of
possible outcomes and Moody's credit assessment considers deeper
downside scenarios incorporating the risks of a slower recovery. In
particular Moody's considers that 2021 is likely to remain a
severely depressed year for the industry, with continued travel
restrictions, health screening and social distancing, consumer
concerns over travel, a weak economic environment and threats of
further coronavirus outbreaks. This is likely to be partially
mitigated by better preparedness by governments and healthcare
systems, international coordination, pent-up consumer demand and
the economic importance of resuming air travel. The timing and
profile of a recovery beyond 2021 also remains highly uncertain.

TAP entered the coronavirus crisis with a levered capital structure
with the rating at the time factoring some further deleveraging.
TAP's gross leverage as measured by Moody's adjusted debt/EBITDA
stood at 6.8x for the fiscal year ended December 31, 2019 leaving
little cushion against the severe market downturn induced by the
coronavirus outbreak.

On June 10, 2020, TAP announced that it has received temporary
liquidity relief through the obtention of a EUR1.2 billion 6-month
loan from the Portuguese government under the European Commission's
Rescue & Restructuring support framework. This loan will provide
TAP with sufficient liquidity to develop and negotiate a
restructuring plan with all necessary stakeholders over the next
six months with a view to have this restructuring plan approved by
the European Commission.

Moody's views the implementation risk of the restructuring
programme as high due to the materiality of the measures required
to ensure the long-term sustainability of TAP's business model and
the large number of stakeholders that need to be involved. Moody's
also cannot exclude at this stage that the restructuring programme
will not include a restructuring of TAP's debt including its rated
debt. Failure to develop a restructuring plan that can be supported
and approved by all stakeholders and the European Commission would
most likely lead to further negative rating migration.

TAP's rating continues to be supported by the strategic importance
of its network to the Portuguese economy as envisaged by the
liquidity support that the Portuguese government has given to TAP.
However, in addition Moody's sees the need of additional equity to
support a sufficient capitalization of the capital structure.

LIQUIDITY

TAP had EUR426 million of cash & marketable securities on balance
sheet as per December 31, 2019 or approximately 13% of 2019
revenue.

The provision of a EUR1.2 billion 6-month loan by the Portuguese
government will provide TAP sufficient liquidity over the next 6
months to negotiate a restructuring plan that can be supported by
all stakeholders and approved by the European Commission. Absent
this liquidity injection from the Portuguese government, Moody's
estimates that TAP's liquidity would be insufficient to remain
operational beyond a couple of weeks.

ENVIRONMENTAL, SOCIAL AND GOVERNANCE CONSIDERATIONS

Moody's regards the coronavirus outbreak as a social risk under its
ESG framework, given the substantial implications for public health
and safety.

TAP's relatively recent fleet and focus on narrow body aircrafts
translates into a good fuel efficiency and lower CO2 footprint than
some of its peers.

FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS

Moody's does not see any positive rating pressure on the current
rating during the time that TAP is negotiating its restructuring
programme. A successful implementation of a comprehensive
restructuring plan leading to a stabilization of TAP's credit and
liquidity profile and ensuring the long-term solvency of the issuer
could lead to positive rating pressure.

The ratings of TAP could be lowered further if the issuer fails to
develop and get approved a comprehensive restructuring plan within
the next 6 months.

PRINCIPAL METHODOLOGY

The methodologies used in these ratings were Passenger Airline
Industry published in April 2018.

COMPANY PROFILE

Headquartered in Lisbon, Portugal, TRANSPORTES AEREOS PORTUGUESES,
S.A. (TAP) is a small sized Portuguese network carrier. TAP is a
member of the Star Alliance since 2005 and operates on average 400
flights per day to 38 countries and 95 airports. In 2019, TAP
transported 17 million passengers and reported EUR3.3 billion of
revenue. As of December 2019, the company's fleet was composed of
106 aircrafts, of which 24 Airbus wide-bodies, 60 Airbus
narrow-bodies and 21 regional planes (ATR and Embraer).

TAP is owned by TAP S.G.P.S., which was privatized in 2015 and was
previously fully owned by the Portuguese Government through
Parpublica-Participacoes Publicas (SGPS), SA (Parpublica, Baa3
positive). After its privatization, TAP S.G.P.S. became majority
owned by a consortium, Atlantic Gateway, which currently holds 90%
of the economic interests and 45% of the voting rights. Parpublica
has reduced its stake in the company to 5% of economic interest,
but kept 50% of voting rights. The remaining 5% are mainly owned by
TAP's employees.




===========
R U S S I A
===========

BELUGA GROUP: Fitch Affirms B+ LongTerm IDRs, Outlook Stable
------------------------------------------------------------
Fitch Ratings has affirmed PJSC BELUGA GROUP's Long-Term Foreign-
and Local-Currency Default Ratings at 'B+' with Stable Outlook

The affirmation reflects its view that Beluga's operating
performance will remain resilient to the COVID-19 pressures.
Despite investments in the expansion of its retail operations and
the initiation of dividend distribution, the company should be able
to reduce its leverage, which as of end 2019 was at the higher end
of the band acceptable for its rating.

KEY RATING DRIVERS

Limited Pressure from COVID-19: Fitch expects a limited impact on
Beluga's performance in 2020 from the pandemic-related hit to the
on-premises sales channel, as the latter accounts for less than 10%
of alcoholic beverages sales in Russia. Beluga's sales in the
off-trade segment continue to grow fast with 5M20 overall alcoholic
beverages sales volumes increasing by double digit rate yoy.
Lockdown measures in Russia had no material impact on alcoholic
beverages consumption so far, but the weakened economic environment
is likely to slow premiumisation trend in 2H20 and 2021.

Reduced global travel flow is likely to hit the duty-free channel,
which accounts for nearly one-third of Beluga's export revenue, but
the group has been able to redirect its shipments to other markets
less dependent on on-trade, including the US, Germany and Asia.

Strong Market Positions Locally: Beluga maintains its positions as
the largest distilled and flavoured spirits producer and
second-largest independent alcohol importer in Russia. The group
owns a wide portfolio of leading local vodka brands in all pricing
segments, and continues growing market shares of its brands in
brandy, wine and other spirits.

The flagship Beluga brand, responsible for 39% of the group's
EBITDA in 2019, is a top super-premium vodka brand in Russia, and
continues strong sales volumes growth (2019: +18%) in a modestly
growing vodka market. It is also exported to more than 95 countries
and is within the top five super-premium vodka brands globally
(according to ISWR, 2018). The group's positions locally are
supported by a wide distribution network and established
relationships with key retailers across Russia.

Improving Diversification: Beluga's product diversification has
been gradually improving over the past eight years, with vodka's
contribution to alcoholic beverages revenues falling to 39% in 2019
from 80% in 2011. This results in lower dependence on a single
beverage category, opening opportunities to increase revenues from
faster-growing categories in Russia, such as wine and brown
spirits. Beluga has diversified into own-branded brandy, whiskey
and flavoured liquors (2019: 26% of alcoholic beverages revenues)
as well as imported wine and spirits (2019: 27%).

The group also continues to grow its vodka export revenues (2019:
+16% yoy; 8% of alcoholic beverages revenue), which is mainly
represented by Beluga brand vodka, improving its geographical
footprint.

Growing Retail Business: Beluga continues to develop its specialty
alcohol retail chain, WineLab, with stores increasing to 605 at
end-2019 (2018: 468) and delivered strong 13% like-for-like sales
growth in the year, accounting for 25% of the company's revenue.
Although Beluga is likely to slow its expansion pace in 2020 amid
the pandemic, Fitch expects new store openings to accelerate from
2021, in line with the company's strategy to increase its scale
towards 1,000 outlets in the long term.

This should provide greater control over revenues (the chain
accounted for 10% of in-house brands and for 38% of partners'
brands sold in 2019) and insights into customer preferences. Fitch
estimates total expansionary capex of around RUB1.1 billion over
the next four years, putting temporary pressure on the group's
generation.

Resilient Profitability: Fitch expects Beluga's EBITDA margin to
remain stable in 2020, supported by sales volumes growth, both in
own and imported spirits, as well as further shift to more premium
products in its core alcoholic beverages segment. Additionally,
Fitch expects the growing contribution of WineLab to dilute the
group's profitability. Although WineLab improved its EBITDA margin
to 10% in 2019 (2018: 8%), this is still below the 11% margin in
the core alcoholic beverages segment. Fitch expects this level to
be sustained thanks to the maturing of the store base and slower
expansions in 2020, as well as continued efficiency initiatives.

Consolidated profitability is likely to remain pressured by low
margin food segment over the next four years.

Pressured FCF Generation: Despite strong growth in funds from
operations in 2019 (+56% yoy) Beluga reported a negative free cash
flow margin of 3% in 2019, mainly due to significant outflow under
its working capital driven by increased inventory stocks due to the
sales growth, new distribution contracts and retail chain
expansion.

Beluga plans a number of initiatives to improve its working capital
management in the coming years, but Fitch cautiously projects
stable working capital as a percentage of revenue, resulting in
further outflows in 2020-23. Fitch also assumes elevated capex and
dividend payments from 2020, which leads to neutral to negative FCF
over the period.

Deleveraging Prospects: Thanks to EBITDA growth and despite
negative FCF generation, Fitch expects that Beluga will be able to
reduce FFO gross leverage below 3.0x by 2023 from 4.5x at end-2019.
This would represent building up rating headroom under Beluga's
leverage metrics, which were close to its negative sensitivity
levels at end-2019.

DERIVATION SUMMARY

Beluga has smaller scale and narrower geographic and product
diversification than other Fitch-rated spirits producers, such as
Diageo plc (A-/Stable), Becle, S.A.B. de C.V. (BBB+/Stable), Pernod
Ricard S.A. (BBB+/Stable) and Thai Beverage (BBB-/Negative). In
addition, Beluga's lower profitability, weaker FFO interest
coverage and FCF generation, explains the large differential in
ratings compared with its peers. This is balanced by strong
leverage metrics more comparable with medians for a 'BB' rating
category according to Fitch's Alcoholic Beverages Rating Navigator.
The 'B+' rating is also supported by the company's leading market
position in Russia and strong brand portfolio.

The rating is one notch higher than the rating of Australia wine
producer Amphora Finance Limited (B/Negative), whose high leverage
constrains the company's IDR to 'B'. Amphora's deleveraging
capability has been hampered by delays in achieving planned cost
savings and the coronavirus-related social distancing measures
affecting its main markets of Australia and the UK. Beluga's
ratings take into consideration the higher-than-average systemic
risks associated with the Russian business and jurisdictional
environment. No Country Ceiling or parent/subsidiary linkage
aspects were in effect for these ratings.

KEY ASSUMPTIONS

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

  - 11% revenue growth for own spirits and a 21% revenue growth for
imported brands in 2020. Fitch projects low-to-mid single digit
revenue growth for own brands and high single digit revenue growth
for imported brands;

  - 4% increase in excise duties per year on ethanol in Russia over
2020-22;

  - EBITDA margin declining to 9.6% in 2020 primarily driven by the
increased share of the less profitable retail segment followed by
gradual improvement due to the maturation of stores and the
company's efficiency improvement programme;

  - Capex at around 1.9% of sales in 2020 increasing to 2.7%-2.8%
thereafter;

  - Total contingent liabilities of RUB985 million in connection
with the GE acquisition to be disbursed in four equal instalments
over 2020-2023;

  - No further M&A;

  - Around RUB400 million common dividends per year; and

  - No share buybacks.

RATING SENSITIVITIES

Factors that could, individually or collectively, lead to positive
rating action/upgrade:

  - Increasing diversification towards a higher share of non-vodka
products and/or growing share of exports in its profits

  - FCF turning and remaining positive, with an EBITDAR margin
trending toward 15% (2019: 12.3%) and increasing business scale

FFO net leverage of below 3x on a sustained basis

  - FFO interest cover above 2.5x (2019: 2.3x) on a sustained
basis

Factors that could, individually or collectively, lead to negative
rating action/downgrade:

  - Deterioration in FFO net leverage of 4x on a sustained basis

  - Decline of FFO interest coverage below 2.0x for a sustained
period

  - Persistently negative FCF and weak liquidity resulting from
expansion-led capex and working capital investments not mitigated
by asset disposals, or due to a more aggressive financial policy

  - Contraction of EBITDAR margin to below 10% for a sustained
period

  - Regulatory changes that may put more pressure on the group's
sales and profitability

BEST/WORST CASE RATING SCENARIO

International scale credit ratings of Non-Financial Corporate
issuers have a best-case rating upgrade scenario (defined as the
99th percentile of rating transitions, measured in a positive
direction) of three notches over a three-year rating horizon; and a
worst-case rating downgrade scenario (defined as the 99th
percentile of rating transitions, measured in a negative direction)
of four notches over three years. The complete span of best- and
worst-case scenario credit ratings for all rating categories ranges
from 'AAA' to 'D'. Best- and worst-case scenario credit ratings are
based on historical performance.

LIQUIDITY AND DEBT STRUCTURE

Adequate Liquidity: At end-December 2019, liquidity available for
Beluga was adequate as its cash (RUB1.1 billion) availability under
long-term credit lines is sufficient to cover short-term debt of
RUB6.4 billion (RUB2.4 billion excluding factoring outstanding) and
negative FCF of RUB1.0 billion estimated for 2020. As most of the
RCFs have financial covenants, Fitch calculates that under current
EBITDA level Beluga will be able to draw down RUB5.7 billion of RCF
without breaching these covenants.

SUMMARY OF FINANCIAL ADJUSTMENTS

Fitch has adjusted receivables, debt and working capital by adding
factoring receivables (December 31, 2019: RUB3.978 billion).

REFERENCES FOR SUBSTANTIALLY MATERIAL SOURCE CITED AS KEY DRIVER OF
RATING

The principal sources of information used in the analysis are
described in the Applicable Criteria.

ESG CONSIDERATIONS

The highest level of ESG credit relevance, if present, is a score
of 3. This means ESG issues are credit-neutral or have only a
minimal credit impact on the entity(ies), either due to their
nature or to the way in which they are being managed by the
entity(ies).


NATIONAL FACTORING: S&P Withdraws 'B/B' Issuer Credit Ratings
-------------------------------------------------------------
S&P Global Ratings said it withdrew its 'B/B' long- and short-term
issuer credit ratings on National Factoring Co. at the company's
request. The outlook at the time of the withdrawal was stable.



PETROPAVLOVSK PLC: S&P Raises ICR to 'B' on Solid Performance
-------------------------------------------------------------
S&P Global Ratings raised to 'B' from 'B-' its long-term issuer
credit and issue ratings on Russian gold producer Petropavlovsk PLC
and its senior unsecured bonds.

The upgrade recognizes the company's continued progress in several
key areas: delivering a strong operating performance, keeping to
its strategy, and deleveraging in line with its base case and its
public leverage target of net debt to EBITDA below 2.0x. The 'B'
rating assumes the company maintains a solid performance in the
next few years and executes its strategy as planned.

S&P said, "We expect 2020-2021 results to show a further
strengthening of EBITDA and positive free operating cash flow
(FOCF).  After a solid 2019, with S&P Global Ratings-adjusted
EBITDA of $234 million compared to $183 million in 2018, we
forecast $275 million-$325 million EBITDA in each of 2020 and 2021.
We expect earnings growth to translate into positive FOCF (after
capex and before dividends, acquisitions, and gold prepay
settlements) of $50 million-$100 million in each of 2020 and 2021.
Earnings will be supported by healthy gold prices (albeit gradually
decreasing from the 2020 peak), steadily rising production from the
pressure oxidation (POX) facility while non-refractory production
from Albyn slowly decreases, and a continued focus on cost control.
We understand that the company has not seen any material effects
from the COVID-19 pandemic on its operations."

The POX Hub processes refractory ore, both from Petropavlovsk's own
reserves (of which about 62% are refractory) and from third-party
concentrate. S&P said, "We expect utilization of the POX Hub to
double by 2021 versus 2019, thanks to growth in the processing of
third-party concentrate and to the coming on stream at end-2020 of
the new Pioneer flotation facility (which doubles capacity compared
to the existing two flotation lines at Malomir). The company's
strategy includes plans for a third flotation line at each of the
Malomir and Pioneer mines, with delivery in 2022 and 2023
respectively. We understand that it will finance this capex from
own cash flows. We expect the increasing use of own refractory ore
to have a positive effect on cash costs."

How FOCF will be allocated over the next few years is the key
question.  With reported net debt to EBITDA at 2.1x at end-2019
compared to its public target of below 2.0x, S&P expects
Petropavlovsk to use the vast majority of its FOCF to maintain
production and reserves, with surplus cash returned to
shareholders. On the M&A front, management's priority is to
identify high-grade refractory assets to improve the quality of the
POX feed material (the technology allows for the processing of a
wide range of qualities of concentrate). S&P understands that its
focus is on small incremental assets, and it will manage any
purchases in conjunction with its commitment to maintain
balance-sheet strength. Petropavlovsk is yet to restart paying
dividends and to shape its dividend policy. The outstanding notes
limit dividend payments while net debt to EBITDA is above 2.0x.
While a dividend for 2020 has not yet been announced, we believe
that some payments could be made in the next six to 12 months,
based on the deleveraging being close to target and our forecast of
FOCF generation.

A hypothetical M&A transaction with Petropavlovsk's main
shareholder JSC Uzhuralzoloto Group of Companies (UGC) could affect
the current rating.  S&P said, "Our rating on Petropavlovsk does
not factor in the possibility of an M&A transaction with UGC, a
privately-owned Russian gold producer that is currently
Petropavlovsk's largest shareholder. If such a transaction
happened, we would assess its impact on the rating of the combined
entity, depending on the capital structure of the combined entity.
As the business profile of the combined entity will be somewhat
stronger due to scale benefits, we could see a different leverage
target applicable for the 'B' rating."

S&P said, "The stable outlook reflects our view that Petropavlovsk
will continue to deliver on production and costs guidance as well
as its target of net debt to EBITDA below 2.0x. It also assumes
that the company will maintain adequate liquidity at all times and
will proactively refinance upcoming maturities, namely the $500
million bonds that mature in November 2022.

"Our base case assumes that S&P Global Ratings-adjusted EBITDA
improves to $275 million-$325 million in 2020 and remains around
that range in 2021, compared to $243 million in 2018. This
translates into adjusted debt to EBITDA of 2.5x-3.0x in 2020 and
2021 compared to 3.6x at end-2019.

"We do not expect the completion of the IRC stake sale to affect
our rating on Petropavlovsk, assuming completion is in line with
publically announced parameters. While it would reduce our adjusted
debt by $160 million (the equivalent of the guarantee that
Petropavlovsk provides to IRC in favor of the latter's Gazprombank
debt) and further improve metrics, an upgrade would require an
additional track record of stability in operating performance and
strategy as well as shaping the financial policy."

The 'B' rating does not factor in a potential M&A transaction with
UGC.

S&P could lower its rating on Petropavlovsk if there were a
meaningful deterioration in prices or cost inflation leading to a
sharp decline in EBITDA generation compared to its base case, or if
the company paid an unexpected, meaningful dividend or made an
acquisition that pushed its adjusted debt to EBITDA above 3.5x and
FFO to debt below 20% without a clear path and management's
commitment to bring it back down.

S&P could also lower our rating if the group's liquidity
deteriorated to less than adequate, for example because it failed
to refinance the $500 million bonds at least one year before their
maturity.

S&P sees limited rating upside in the next 12 to 24 months.

Factors supporting positive momentum over the longer term would
include:

-- FFO to debt of sustainably above 20%, adjusted debt to EBITDA
below 3.5x, and positive discretionary cash flows;

-- Additional track record of stability in operating performance
and strategy;

-- Shaping and track record of the financial policy; and

-- Maintaining at least adequate liquidity.




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

NH HOTEL: Moody's Lowers CFR to B3, Outlook Stable
--------------------------------------------------
Moody's Investors Service downgraded to B3 from B1 the corporate
family rating of NH Hotel Group S.A. Concurrently, the probability
of default rating was downgraded to B3-PD from B1-PD and the rating
on its EUR357 million senior secured note due 2023 issued by NH
Hotel was downgraded to B2 from Ba3. The outlook changed to stable
from ratings under review.

RATINGS RATIONALE

The rating action was prompted by the very sharp decline in
occupancy in Q2 so far, driven by travel restrictions since the
outbreak of coronavirus started during January 2020 with severe
government measures restricting operations in many of NH Hotel's
core countries. From a regionally contained outbreak, the virus has
rapidly spread to many different regions severely denting air
travel and the lodging sector.

Moody's revised base case assumptions are that the coronavirus
pandemic will lead to a period of severe reductions in hotel guests
over at least the next three quarters with closures of hotels in
worse effected locations and very low occupancy or full
cancellations for other hotels in other countries. The base case
assumes there is a gradual recovery in hotel occupancy starting in
the third quarter. However, there are high risks of more
challenging downside scenarios and the severity and duration of the
pandemic and hence on travel restrictions while customer sentiment
also remains uncertain. Moody's analysis assumes around a 55%
reduction in revenues for the full year 2020 and for 2021 to remain
at least 20% below 2019 levels, but depending on length and
severity of the travel restrictions this could include a
significantly deeper downside case including essentially zero
occupancy.

Over the last three months, NH Hotel has successfully reduced
staff, supplier costs as well as negotiated fixed lease reductions.
In addition, the company has significantly reduced capex. The
company has managed to create a substantial cash buffer of more
than EUR600 million as of end May, which includes full drawing its
EUR250 million revolving credit facility, EUR24.5 million
short-term bilateral credit facilities, a new loan of EUR260
million. Based on the company's cash burn rate of EUR50-55 million
per month at current occupancy levels, the company can survive
almost a full year with no revenues. The strong liquidity position
is a key supporting factor of the B3 rating and the stable outlook.
Additionally, NH Hotel has a significant pool of fully owned
unencumbered assets amounting to EUR729 million as per the last
appraisal date, which increases financial flexibility and could be
used for secured borrowing. Looking at the group's recovery
prospects, Moody's notes that NH Hotel has started to open hotels
in select locations. Moody's believes that the group's share of
domestic guests, which is on average 50%-55% of total guests for
Euro area, and its focus on leisure travel (60%-70% vs. 30%-40%
business travel) will be favourable in the recovery of NH Hotels
occupancy levels and revenues, according to information provided by
the Company in Q1 2020 results presentation.

However, 2020 will be a lost year for the lodging industry due to
the coronavirus pandemic and the rating action focuses on the
expected outcome for credit metrics towards the end of 2021,
notably debt to EBITDA which Moody's expects to be around 8x, up
from LTM Q1 2020 of 5.9x. Also, EBITDA coverage will remain weak at
around 1x by that time, which are the key drivers for the B3
rating. On a more positive note, Moody's believes that NH Hotel has
the capacity to return to become cash generative again over 2021,
where Moody's currently forecasts around break even free cash flow
generation, although noting a high degree of uncertainty related to
the pace and shape of the recovery.

Moody's regards the coronavirus outbreak as a social risk under its
ESG framework, given the substantial implications for public health
and safety.

FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS

  -- Given the current market situation Moody's does not anticipate
any short-term positive rating pressure. However, if debt to EBITDA
would stay below 6x, EBITA interest coverage approaching 1.5x and
cash-flow (RCF/net debt) at 10% all on a sustained basis and
including Moody's standard adjustments.

  -- Strong liquidity and positive free cash flow

  -- Deterioration in the credit profile such that the leverage
rises to above 10x, coverage to 0.5x and cash flow to net debt
drops below 5%

  -- Any liquidity constraints

  -- Material deterioration in the LTV coverage of the secured
notes could put pressure on the instrument rating

LIST OF AFFECTED RATINGS

Issuer: NH Hotel Group S.A.

Downgrades, previously placed on review for downgrade:

Probability of Default Rating, Downgraded to B3-PD from B1-PD

Corporate Family Rating, Downgraded to B3 from B1

Senior Secured Regular Bond/Debenture, Downgraded to B2 from Ba3

Outlook Action:

Outlook, Changed to Stable from Ratings Under Review

PRINCIPAL METHODOLOGY

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




===========
T U R K E Y
===========

ARAP TURK: Fitch Affirms LT IDRs at B+, Outlook Negative
--------------------------------------------------------
Fitch Ratings has affirmed Arap Turk Bankasi A.S.'s Long-Term Local
and Foreign Currency Issuer Default Ratings at 'B+' with a Negative
Outlook.

KEY RATING DRIVERS

IDRS, VIABILITY RATING AND NATIONAL RATING

The IDRs and National Rating are driven by the standalone strength
of ATB, as reflected in its 'b+' Viability Rating. The VR reflects
ATB's reliance on parent funding from its majority shareholder,
Libyan Foreign Bank, and affiliated entities. The ratings also take
into consideration the limited franchise of ATB within the Turkish
banking sector, its specialist focus on the niche business of
providing short-term trade finance in the high-risk Middle East and
North Africa region and high credit concentrations on- and
off-balance sheet. The VR benefits from ATB's track record of sound
financial performance.

The Negative Outlook reflects the potential for the weak Turkish
operating environment to place greater pressure on the bank's
financial metrics than already observed. It also reflects the
potential for the bank's funding and liquidity to come under
pressure if shareholder-related funding was not available on an
ordinary basis or the bank was unable to source new, stable funding
facilities.

ATB's ratings also capture the risks of operating in the volatile
Turkish market where the majority of its business is concentrated,
which heightens risks to asset quality, profitability and
capitalisation. Downside risks to the bank's credit profile have
been heightened by the coronavirus outbreak and lockdown measures.
Fitch forecasts Turkey's GDP will contract 3% in 2020 followed by a
subsequent sharp recovery (5.0% GDP growth) in 2021. A larger than
expected weakening in economic growth and an ensuing weaker
recovery in 2021 would add to existing pressure on the bank's
credit profile.

Monetary policy measures and fiscal support for the private sector
and financial markets, including the Central Bank of the Republic
of Turkey interest-rate cuts, could support borrowers' repayment
capacity. In addition, regulatory forbearance measures will provide
uplift to the bank's reported asset quality, capital and
performance metrics over the short term.

Asset quality risks are also mitigated to some extent by the fact
that many of ATB's borrowers are larger Turkish corporates with
diversified operations, while exposures - mainly comprising trade
finance and working capital loans - are also largely short term.

Transactions with Libya, although a higher risk country, have
performed well over time. These mainly include letters of
guarantees and export letters of credit. A high proportion of these
are mitigated by counter-guarantees from large Turkish banks and
corporates. However, the Turkish banking regulator has recently
asked Turkish banks to cancel their letters of guarantees (L/Gs)
provided in relation to clients' projects in Libya, which could
weaken the bank's franchise, in Fitch's view.

ATB's asset quality metrics compare well with Turkish commercial
banks' and trade finance bank peers', as impaired loans represented
a low 0.3% of total cash loans at end-1Q20. The main risks to asset
quality are from a high share of foreign currency loans, and high
borrower and geographic concentration in volatile economies.

Deposits and borrowings from LFB Group represented 27% of ATB's
total funding at end-1Q20, resulting in a significant funding
concentration. The bank has been reducing the share of parent
funding in order to diversify its funding base. Other funding
sources include bank borrowings (50%) and customer deposits (23%).

ATB's Common Equity Tier 1 Capital Ratio of 19.6% at end 1Q20,
including the impact of regulatory forbearance, compares well with
other small Turkish banks and reasonably with trade finance peers.
In the short term, regulatory forbearance will provide uplift to
ATB's reported capital metrics. Fitch estimates its CET1 ratio
would have been 120bp lower net of forbearance measures at
end-1Q20.

However, capital is small in absolute terms (end-2019: TRY1,073
million), especially when considering the bank's high credit
concentrations. Capital adequacy ratios are also highly sensitive
to an increase in foreign currency risk-weighted assets stemming
from depreciation of the Turkish lira, given the large proportion
of foreign currency assets on the balance sheet (77% at end-2019,
mainly in euros and US dollars).

Profitability ratios compare favourably with trade finance bank
peers', despite tough operating conditions in the bank's core
markets (last four full-year average operating profit/risk-weighted
assets: 2.7%). Margins were solid in 2019 (net interest margin:
7.4%) as the bank benefitted from high lira interest rates and low
cost of funding. However, Fitch expects margins to come under
pressure this year lira interest rates decrease. Loss of commission
income from Libyan L/Gs will also put pressure on the revenues.

The affirmation of ATB's 'A(tur)' National Long-Term Rating
reflects Fitch's view that the bank's credit profile relative to
others financial institutions in the Turkish market has not
changed.

SUPPORT RATING AND SUPPORT RATING FLOOR

The bank's '5' Support Rating reflects Fitch's view that the
likelihood of extraordinary support from ATB's key shareholder
cannot be reliably assessed. The '5' Support Rating and the
assigned 'No Floor' Support Rating Floor also reflect Fitch's view
that support from the Turkish authorities cannot be relied upon,
given ATB's limited systemic importance.

RATING SENSITIVITIES

IDRS, VR AND NATIONAL RATING

Factors that could, individually or collectively, lead to negative
rating action/downgrade:

The bank's IDRs and National Rating are sensitive to a change in
the VR. The bank's VR could be downgraded in case of a material
deterioration of the bank's financial metrics, for example as a
result of a weakening of the Turkish operating environment or the
economic fallout from the coronavirus pandemic. The VR could also
come under pressure if ATB's strategic importance to LFB is reduced
through a substantial loss or withdrawal of funding or business,
prompting a significant change in business model.

ATB's National Ratings are also sensitive to a change in the
entity's creditworthiness relative to other rated Turkish issuers.

Factors that could, individually or collectively, lead to positive
rating action/upgrade:

The Outlook could be revised to Stable and the ratings affirmed if
the disruption caused by the pandemic proves to be short-lived and
if bank emerges from it with relatively unscathed financial
profile.

Upside for the ratings is limited given the bank's small size,
niche franchise, high reliance on parent funding, and exposure to
Turkish operating environment risks. A positive rating action would
require a sovereign upgrade, as well as a positive reassessment of
the Turkish operating environment and strong and sustained
improvement in ATB's financial profile.

SUPPORT RATING AND SUPPORT RATING FLOOR

The Support Rating could be upgraded if Fitch judges that LFB is
able to provide extraordinary support to ATB, in case of need. This
would be contingent on a more stable operating environment in Libya
and the continuing strategic importance of ATB to LFB. Upward
revision of the Support Rating Floor would be contingent on a
significant increase in ATB's systemic importance and is unlikely,
in its view.

BEST/WORST CASE RATING SCENARIO

International scale credit ratings of Financial Institutions
issuers have a best-case rating upgrade scenario (defined as the
99th percentile of rating transitions, measured in a positive
direction) of three notches over a three-year rating horizon; and a
worst-case rating downgrade scenario (defined as the 99th
percentile of rating transitions, measured in a negative direction)
of four notches over three years. The complete span of best- and
worst-case scenario credit ratings for all rating categories ranges
from 'AAA' to 'D'. Best- and worst-case scenario credit ratings are
based on historical performance.

REFERENCES FOR SUBSTANTIALLY MATERIAL SOURCE CITED AS KEY DRIVER OF
RATING

The principal sources of information used in the analysis are
described in the Applicable Criteria.

ESG CONSIDERATIONS

The highest level of ESG credit relevance, if present, is a score
of 3. This means ESG issues are credit-neutral or have only a
minimal credit impact on the entity(ies), either due to their
nature or to the way in which they are being managed by the
entity(ies).

Arap Turk Bankasi A.S.

  - LT IDR B+; Affirmed

  - ST IDR B; Affirmed

  - LC LT IDR B+; Affirmed

  - LC ST IDR B; Affirmed

  - Natl LT A(tur); Affirmed

  - Viability b+; Affirmed

  - Support 5; Affirmed

  - Support Floor NF; Affirmed




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

AMIGO LOANS: S&P Lowers ICR to 'CCC+' on Business Instability
-------------------------------------------------------------
S&P Global Ratings lowered its long-term issuer credit rating on
U.K.-based guarantor lending company Amigo Loans Ltd. to 'CCC+'
from 'B'. At the same time, S&P lowered its issue rating on its
senior secured bonds to 'CCC+'. The ratings remain on CreditWatch
with developing implications.

The downgrade reflects S&P views that Amigo's prospects are
becoming increasingly uncertain. The recent dispute between the
board and majority shareholder James Benamor has undermined Amigo's
business stability, in its opinion. Recently, Mr. Benamor
unexpectedly announced an extraordinary general meeting to remove
the entire Amigo board. On June 17, the shareholders voted to keep
Amigo's board and Mr. Benamor decided to step away from the
business and sell his majority stake through a broker. Furthermore,
Amigo's potential buyer stepped back. These developments have
increased the uncertainties regarding the company's future
ownership and strategic direction.

At the same time, the FCA has initiated an investigation into
Amigo's lending policies. Amigo is the dominant lender in the
guarantor loan market and its narrow focus on a niche part of the
U.K.'s nonstandard lending market, combined with low
diversification, implies that ongoing regulatory risk could be
detrimental to its business operations.

On June 8, 2020, Amigo announced an estimated GBP35 million
complaints charge and higher expected provision levels once it
announces its full year results for financial year ending March 31,
2020 (FY2020), which it has stated it will announce on or before
July 23. This will most likely lead to weaker leverage metrics.

Amigo stopped new lending in late March because of COVID-19. S&P
believes that the current difficult macroeconomic environment, the
FCA investigation, and the uncertain future ownership puts
additional pressure on Amigo's ability to resume lending.

Amigo reported GBP115 million in cash as of May 25, 2020, in line
with its strategy to build liquidity buffers. Amigo's next coupon
payment on its GBP234.1 million outstanding secured bond, which is
due in 2024, is on July 15, 2020. S&P said, "We also understand
that Amigo's securitization facility will enter the amortization
period in July 2020 if it is not extended. We believe that Amigo is
not facing a near term credit or payment crisis, but is dependent
on favorable business, financial, and economic conditions to meet
its financial commitments."

The CreditWatch with developing implications reflects near-term
uncertainty around Amigo's business stability and debt-servicing
capacity.

S&P said, "We could lower the rating in the next three months if we
think that regulatory or operational issues will make its business
model less viable or if Amigo's credit ratios weaken further. We
could also lower the rating if Amigo is not able to resume lending
and its business continues to amortize, putting pressure on its
covenant ratios and suggesting the need for early bond redemption.
We could also consider a downgrade if Amigo decides on a public
bond repurchase below par or goes into debt restructuring.

"We could raise the ratings if Amigo demonstrates that it is able
to resume lending activities and maintain stable credit ratios. At
the same time, we would consider Amigo's ownership status, future
strategy, the results of the FCA investigation, and its operating
environment."


ARDONAGH MIDCO 3: Fitch Cuts LT IDR to B-, Outlook Stable
---------------------------------------------------------
Fitch Ratings has downgraded Ardonagh Midco 3's Long Term Issuer
Default Rating to 'B-' from 'B'. The Outlook is Stable. Fitch has
also assigned a 'CCC(EXP)' rating to the proposed GBP400 million
equivalent U.S. dollar- denominated senior PIK (payment-in-kind)
toggle notes due 2026.

The downgrade of Ardonagh follows the total GBP2 billion
refinancing of its debt structure enabling the company to fund the
acquisitions of the Bravo Group and the Arachas Group. Funds from
operations gross leverage is expected to remain above 7.0x for at
least three years under its assumptions, above its thresholds for
the previous 'B' rating.

The Stable Outlook reflects its expectation that continued cost
savings, synergies and healthy free cash flow (FCF) will all
support sufficient organic deleveraging. With a new revolving
credit facility and new delayed draw facilities both expected to be
undrawn at closing Fitch expects Ardonagh to have good liquidity.

The ratings of Ardonagh's existing debt facilities will be
withdrawn when they are repaid as part of this refinancing.

KEY RATING DRIVERS

Acquisitions Increase Leverage: The new capital structure will
bring a material increase in debt, with total debt (excluding
leases) increasing to GBP2 billion at refinancing close from the
GBP1.2 billion reported in March 2020. Fitch estimates Ardonagh's
FFO gross leverage for 2021, the first full financial year after
the acquisitions, at 9.5x. The refinancing follows a series of
debt-funded acquisitions over the last three years, including the
purchase of Swinton Insurance in 2018. Notwithstanding the
operational and strategic rationale for such acquisitions, without
material equity injections into the capital structure leverage has
been managed above its 'B' rating threshold for the last three
years.

Complete Refinancing: The GBP2 billion refinancing will be used to
refinance all existing debt facilities, including the existing RCF
and extend the maturities of the capital structure. Also included
in the new financing is a GBP300 million delayed draw facility,
which will support future M&A. Fitch assumes the acquisitions and
the refinancing will be successfully completed in July.

Margin Growth to Continue: Ardonagh has made good progress in its
GBP30 million annualised cost- saving programme, with GBP11 million
already implemented as of March 31, 2020. Fitch expects the
acquisitions announced on June 22, 2020 and the proposed
acquisitions of Bennetts announced on February 17, 2020 to deliver
further cost savings of up to GBP7 million by 2022. After deducting
rights-of-use asset depreciation and amortisation and lease
interest charges Fitch conservatively assumes EBITDA margin to
increase to 31% by 2022 from 26% in 2019. The insurance broking
market remains highly fragmented and Fitch expects the company to
continue pursuing opportunistic, EBITDA accretive bolt-on
acquisitions.

Higher Execution & Integration Risks: While increasing scale is key
to margin growth in the insurance broking industry, Fitch believes
integration and cost-saving programmes may sometimes take longer
than expected, often demanding higher business transformation
spending and investments. Ardonagh has extracted good EBITDA growth
from previous acquisitions and cost-saving measures but
acquisitions of larger businesses such as Swinton, Bravo and
Arachas could come with higher integration risks. The larger debt
burden under the new financing also increases the need for solid
execution of their cost-saving plans.

Acquisitions Increase Scale: The acquisitions of Bravo and Arachas
both increase the scale of the company's advisory business unit,
which provides insurance broking products and advice to SMEs and
large corporates. Advisory will become the largest segment of the
consolidated group at 38% of revenues on a pro-forma basis. Fitch
expects the retail business to generate the lowest underlying
growth of the three main segments and with margin improvements and
mid-single digit revenue growth expected in advisory, Fitch views
the change in business mix towards advisory as a positive factor.

FCF to Improve: As a result of the transformation spending and
regulatory fines, Ardonagh has reported negative FCF for the last
four years. As it cuts back on this investment and reaches the end
of its regulatory repayments, Fitch expects FCF to return to
positive levels with high mid-single digit FCF margins expected
from 2021 onwards.

COVID-19 Risk: At its 1Q20 results in May, management said the
virus to date has had a limited impact on the business (GBP1
million impact on LTM 1Q20 EBITDA) with cost measures put in place
to mitigate lost revenues. Fitch believes the company has reacted
swiftly to the effects of the virus and benefitted from selling
essential insurance products. Fitch expects a material portion of
the advisory business to be exposed to SME businesses and while the
UK government's economic measures have provided short-term support
to small businesses their survival prospects over the next two
years is at this stage unclear.

Strong First Quarter: For 1Q20 Ardonagh reported 1.6% yoy revenue
growth and an increase in adjusted EBITDA margin to 27.2% from 25%.
The company also delivered GBP5.3 million of cost savings
identified in December 2019, reflecting management's ability to
drive margin improvements. Operating cash generation reached an
all-time high at 93% on an LTM basis and legacy costs and
investment spending was reduced.

DERIVATION SUMMARY

Ardonagh has less scale in the UK than the large international
insurance brokers. However, Ardonagh has greater scale and a more
diverse product offering than other independent brokers Acropole
BidCo SAS (B/Negative) and Andromeda Investissements SAS
(B/Stable). While its expertise in niche, high-margin product lines
and its leading position among UK insurance brokers underpin a
sustainable business model, Ardonagh's higher financial risk, lower
financial flexibility, and the need for continued progress toward
integrating acquisitions constrain the rating.

KEY ASSUMPTIONS

The Bravo, Arachas and the Bennett's acquisitions to close on June
30 with six-month contributions in the 2020 consolidated numbers.

Revenue to increase by 10%-13% in 2020 and 2021 following the
announced acquisitions. Thereafter revenue growth of just over 4%
per year.

Pre-IFRS16 EBITDA margin to increase to 27.4% in 2020 before
growing to over 31% by 2022. EBITDA margin growth driven by
predominantly by announced cost-saving measures and deal-related
cost synergies.

PIK for interest payments the chosen option when opportunity
allows

GBP50 million of regulatory payments in respect of enhanced
transfer value schemes (ETV) in 2020 and 2021 (ETV provision was
GBP38.5 million at March 2020)

Capex to rise to 4% of sales in 2020 before declining towards 1% by
2022.

KEY RECOVERY ASSUMPTIONS - NEW DEBT STRUCTURE

  - Fitch uses a going-concern approach for Ardonagh in its
recovery analysis, assuming that it would be considered a
going-concern in the event of a bankruptcy rather than be
liquidated

  - A 10% administrative claim

  - Post-restructuring going-concern EBITDA estimated at EUR190
million, 22% below its projected 2021 Fitch-defined EBITDA

  - Fitch uses an enterprise value multiple of 5.5x to calculate a
post-restructuring valuation

These assumptions result in a recovery rate for the new GBP400
million PIK notes within the 'RR6' range, resulting in the
instrument rating being two notches below Ardonagh's IDR.

KEY RECOVERY ASSUMPTIONS - EXISTING DEBT

Its recovery assumptions for the existing capital structure are
unchanged from its previous review. It is its assumption that on
closing of this deal the existing debt structure will be completely
repaid.

RATING SENSITIVITIES

Factors that could, individually or collectively, lead to positive
rating action/upgrade:

No significant changes to operating and regulatory conditions with
at least stable EBITDA margin leading to FFO gross leverage being
sustainably below 7x

FFO interest cover above 2x

Successful delivery of cost saving programmes and full realisation
of deal-related synergies

Positive FCF generation and a financial policy demonstrating
commitment to reducing leverage

Factors that could, individually or collectively, lead to negative
rating action/downgrade:

Increasing competitive pressure or operational challenges resulting
in lower EBITDA margin leading to FFO gross leverage being
sustainably above 9x

FFO interest cover below 1.5x

Consistently negative FCF and sustained use of RCF or other
facilities to support liquidity

BEST/WORST CASE RATING SCENARIO

International scale credit ratings of Non-Financial Corporate
issuers have a best-case rating upgrade scenario (defined as the
99th percentile of rating transitions, measured in a positive
direction) of three notches over a three-year rating horizon; and a
worst-case rating downgrade scenario (defined as the 99th
percentile of rating transitions, measured in a negative direction)
of four notches over three years. The complete span of best- and
worst-case scenario credit ratings for all rating categories ranges
from 'AAA' to 'D'. Best- and worst-case scenario credit ratings are
based on historical performance.

LIQUIDITY AND DEBT STRUCTURE

Healthy Liquidity: Each aspect of the new financing will be
structured as a bullet repayment with no amortising tranches and
long-dated maturities. Fitch expects Ardonagh to start generating
high single-digit FCF margins from 2021 as regulatory payments and
restructuring costs start to decline.

REFERENCES FOR SUBSTANTIALLY MATERIAL SOURCE CITED AS KEY DRIVER OF
RATING

The principal sources of information used in the analysis are
described in the Applicable Criteria.

ESG CONSIDERATIONS

The highest level of ESG credit relevance, if present, is a score
of 3. This means ESG issues are credit-neutral or have only a
minimal credit impact on the entity(ies), either due to their
nature or to the way in which they are being managed by the
entity(ies).

Ardonagh Midco 3 plc

  - LT IDR B-; Downgrade

  - Senior secured; LT B; Downgrade

  - Super senior; LT BB-; Downgrade

Ardonagh Midco 2 plc

  - LT IDR B-; New Rating   

  - Subordinated; LT CCC(EXP); Expected Rating


CLARION EVENTS: S&P Lowers ICR to 'CCC+' on Weaker Liquidity
------------------------------------------------------------
S&P Global Ratings lowered its long-term issuer credit rating on
U.K.-based events organizer Clarion Events and the issue ratings on
its debt to 'CCC+' and assigned a negative outlook. S&P removed the
ratings from CreditWatch negative.

S&P believes the COVID-19 pandemic will weigh heavily on Clarion's
credit metrics and liquidity.

The pandemic will likely have a more material effect on the
company's revenues, earnings, cash flow, and liquidity in FY2021
than we estimated when S&P placed the ratings on CreditWatch with
negative implications on March 18, 2020. Since then, the group has
cancelled and postponed most of the shows that had been initially
scheduled to run between April and September 2020 globally. Clarion
did not hold any events in April and May and expects most shows
will only return in October 2020 and beyond. We now estimate that
Clarion's revenue could reduce by about 45% to GBP190
million-GBP210 million in FY2021 from about GBP400 million in
FY2020. This will translate into minimal S&P Global
Ratings-adjusted EBITDA (including costs and losses from cancelled
and delayed events) despite management's comprehensive cost-cutting
actions. S&P also forecasts free operating cash flow will be
negative in FY2021 at around minus GBP50 million-GBP70 million,
leading to higher gross debt and weakening liquidity. Assuming
Clarion's operating performance recovers in line with its base
case, the events scheduled from October go ahead as planned, and
bookings for calendar 2021 events continue, the group's leverage
will likely remain very high in FY2022. S&P Global Ratings-adjusted
debt to EBITDA is likely to remain above 8x and EBITDA cash
interest coverage will only be about 1.5x-2.0x. Significant
downside risks remain to our forecast.

Clarion's liquidity position has become less than adequate, despite
management's measures to reduce cash burn.  At the end of
first-quarter FY2021 (ending April 30, 2020) Clarion had about
GBP100 million of cash on the balance sheet, including the fully
drawn GBP75 million revolving credit facility (RCF) maturing in
September 2023, and significant advances collected for future
events. The cash balance was ahead of management's guidance due to
continued collection of payments, cost-cutting measures, and
minimal refunds to date. However, S&P estimate that in the second
and third quarters of financial 2021 (ending July 31 and Oct. 31,
2020) Clarion's EBITDA and free cash flow will be negative and the
cash balance will reduce. This will leave the group with minimal
headroom to absorb any underperformance against S&P's base case, or
potential working capital outflows.

If Clarion sees a lower-than-expected inflow of cash from new
bookings or if exhibitors claim back the material advances that
Clarion has collected to date, its cash position could rapidly
deteriorate. This would increase the risk of Clarion being unable
to service its fixed charges over the next six to 12 months,
including the interest on its senior secured debt. At the end of
first-quarter FY2021, Clarion's gross debt of about GBP715 million
consisted of the fully drawn GBP75 million RCF due in 2023, a
GBP315 million senior secured term loan (facility B1), and $412
million senior secured term loan (facility B2) both due in 2024.
S&P estimates annual cash interest to be about GBP35 million-GBP40
million, with about GBP23 million due to be paid between September
and November 2020.

S&P estimates that currently Clarion has adequate headroom under
the springing covenant that applies to the RCF and is tested when
it is more than 40% drawn. The covenant requires the net senior
secured leverage to EBITDA ratio to not exceed 10.2x and allows
exceptional COVID-19-related losses to be excluded from the EBITDA
calculation. S&P therefore forecast Clarion will have some headroom
under the covenant over the next 12 months.

There remains high uncertainty about recovery in the second half of
FY2021 and in FY2022.  S&P expects that lockdown restrictions will
be gradually lifted globally around mid-summer 2020 and that the
shows Clarion scheduled from October 2020 will go ahead. However,
S&P assumes shows will run at reduced capacity, because social
distancing measures will have to stay in place until a vaccine is
found, potentially by mid-2021, and health and safety concerns
might affect the willingness of some exhibitors to attend
face-to-face events. There is still a risk that if there are new
local outbreaks of COVID-19, local and national governments could
re-impose restrictions on travel and public gatherings.

Environmental, social, and governance (ESG) credit factors for this
credit rating change:  

-- Health and safety.

The negative outlook reflects the risk that the business disruption
from the coronavirus pandemic could further weaken Clarion's credit
metrics and liquidity, with uncertain prospects for recovery in
financial 2022.

S&P could lower the rating over the next six to 12 months if its
see an increasing risk of a near-term payment crisis or default.
This could happen if:

-- Clarion faces further show cancellations and delays in
second-half FY2021 and in FY2022, or a higher outflow of working
capital or lower cash collection for future bookings than we
currently expect, such that its liquidity rapidly deteriorates;

-- There is an increased risk that the group is unable to service
interest payments on its debt; and/or

-- There is an increasing probability of a debt restructuring,
distressed exchange offer, or debt buyback that S&P would view as
distressed and tantamount to a default.

S&P could revise the outlook to stable if Clarion performs in line
with its base case and maintains the shows currently scheduled for
the rest of 2020 as planned, and its cash generation and liquidity
position sustainably improves.


FERROGLOBE PLC: Fitch Lowers LT Issuer Default Rating to CCC-
-------------------------------------------------------------
Fitch Ratings downgraded Ferroglobe PLC's Long-Term Issuer Default
Rating to 'CCC-' from 'CCC+' and its USD350 million senior
unsecured notes to 'CCC-/RR4' from 'CCC+/RR4'.

The downgrade reflects its view of a higher refinancing risk for
Ferroglobe's USD350 million notes due in March 2022, exacerbated by
the limited scope for further asset disposals. Fitch expects
negative free cash flows (FCF) and funds from operations (FFO)
gross leverage above 6x until 2022 at earliest, which remains
contingent on a recovery of end-markets by that period.

Ferroglobe's USD100 million asset- based revolving credit facility
(RCF) due 2024 includes a spring-forward covenant which is likely
to be triggered in December 2021 if Ferroglobe's USD350 million
notes are not refinanced beforehand. The company also has a USD150
million accounts receivable securitisation facility due December
2021.

KEY RATING DRIVERS

Prolonged Weakness in Silicon Metals: Fitch expects 2020 to be the
second consecutive year of mid-to high-single digit decline in
silicon metal (SiMe) demand, both in the US and the EU. Demand for
aluminium alloys (from automotive end-markets) remains under
pressure while the COVID-19 pandemic also erodes demand for
chemicals and solar-grade silicon. Although supply cuts by
producers somewhat mitigate the 2020 demand shock, Fitch expects
2020 SiMe prices to fall by at least high single-digits following a
15%-20% decline in 2019. Fitch does not expect the supply-demand
balance and prices to recover before 2021, with recovery likely to
be slow and fragile.

Fourth-Quartile SiMe Producer: Ferroglobe's SiMe assets have seen
an increase in their cash costs and moved to the fourth quartile in
2019 on the global cost curve, based on data from CRU. This is due
partly to a weakening of emerging-market currencies. Exchange rates
have a profound impact on producers' cost position, as 70%-85% of
costs are in local currencies. Ferroglobe produces mostly in the
eurozone and in US dollars, which puts it at a temporary
disadvantage against producers in Brazil that have enjoyed a
sharply lower Brazilian real. Further some of its competitors are
facing a sharper drop in electricity costs or, in the case of
Chinese producers, lower electrodes costs.

Margins Bottoming Out: With SiMe and Ferrosilicon (FeSi) prices
stabilising in 2020, Fitch expects higher-cost producers such as
Ferroglobe to see a margin turnaround from 2021 as demand-supply
rebalances and input costs ease. Given that Ferroglobe's SiMe
ex-China global market share was around 15%, Fitch expects that its
output cuts at loss-making plants will help rebalance the market
without further margin squeeze. For manganese alloys, Fitch expects
manganese ore prices to normalise from June and weaken alongside
ferromanganese (FeMn), after rising in April-May 2020 as lockdown
in South Africa threatened the country's ore exports.

Normalising Input Costs: Prices across key inputs for SiMe
production - electricity, coal and coke, and electrodes - eased in
both 2019 and early 2020 after a spike in 2018. Fitch expects input
costs - energy and coal/coke prices - to decrease in 2020. This is
due to lower demand globally for these inputs, but Fitch expects a
stronger positive impact for Ferroglobe's competitors in emerging
markets as they benefit from a sharp depreciation of local
currencies.

Weak Steel Markets Hit FeSi: FeSi is predominantly used in steel
alloys production, making it particularly exposed to volatile
overall steel market performance. Average FeSi spot prices in
Europe in 2019 slumped 33% yoy, and after a modest 1Q20 increase on
tight supply prices fell back to below the 2019 average in May
2020. This followed a sharp 13% global and 23% EU decline in steel
production in April 2020 from a year ago. Fitch conservatively
forecasts a near 10% global steel demand drop in 2020 and only a
partial rebound in 2021, weighing on FeSi markets globally.

Limited Scope for Additional Divestitures: Ferroglobe has in
monetary terms fewer non-core assets left to sell following
successful divestitures in 2019. It sold Ferroatlantica S.A.U.,
which included its Cee-Dumbria ferroalloys plant and 10
hydroelectric plants for EUR156 million (USD170 million) to TPG
Sixth Street Partners, its Polish subsidiary for USD3.5 million and
a timber farm in South Africa for USD8.6 million. A strategic
review might lead to more of its assets being designated as
non-core, and a sale of these assets would also impact its EBITDA
projections. Disposals netted Ferroglobe USD185.7 million in 2019.

Relationship with Parent: Spain's Grupo Villar Mir (GVM), a
privately held Spanish conglomerate, is the majority shareholder
(53% at end-2019) of Ferroglobe. Fitch assesses Ferroglobe on a
standalone basis. However, most of the shares GVM owns in
Ferroglobe were pledged to secure its obligations to a syndicate of
banks and funds led by Credit Suisse in 2018. Ferroglobe's USD350
million notes prohibit upstreaming of dividends in an absence of
profitability.

DERIVATION SUMMARY

Ferroglobe is the largest western producer of silicon metal,
silicon-based and manganese-based alloys with product
diversification comparable to PAO Koks' (B/Stable) and Ferrexpo
plc's (BB-/Stable). Ferroglobe's position on the upper end of the
global silicon-based and manganese-based alloys cost curve is a
weakness compared with peers', which translated into much higher
earnings volatility both in 2015-2016 and since 2H18. A combination
of demand-driven price weakness and elevated input costs are
leading to substantial EBITDA pressure. Ferroglobe's critical mass
in the alloys markets has been historically viewed as a strength
but the group's higher-cost capacity suspensions have yet to have a
meaningful impact on ferroalloys prices in main markets.

Ferroglobe's financial profile is materially weaker than peers' due
primarily to sharp EBITDA declines and previous accumulation of
high-cost inventories. Deleveraging cannot rely on FCF generation,
which Fitch forecasts to be negative over the next four years, and
Fitch assesses the refinancing risk as high.

KEY ASSUMPTIONS

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

  - Average 2020-2023 realised prices for silicon metal,
silicon-based alloys and manganese-based alloys of around
USD2,220/t, USD1,550/t and USD1,200/t

  - General cost reduction in 2020 on cheaper coal/coke, manganese
ore and electricity, with slow cost inflation thereafter

  - Further capacity cuts and inventory release in 2020 coupled
with sales volumes pressure in alloys. Recovery in sales volumes
across the product range starting from 2021.

  - EBITDA of USD25 million in 2020, USD80 million in 2021 and
USD120 million - USD130 million in 2022 and 2023

  - Capex bottoming out at below USD40 million in 2020, rebounding
towards USD75 million by 2022 as EBITDA recovers

KEY ASSUMPTIONS FOR RECOVERY ANALYSIS

  - Fitch assumes that Ferroglobe would be liquidated in bankruptcy
rather than reorganised.

  - The liquidation estimate reflects Fitch's view of the value of
inventory and other assets that can be realised in a reorganization
and distributed to creditors.

  - Fitch applies a 75% advance rate for accounts receivables
(adjusted for accounts receivables included in securitisation
facility), 50% for inventories and 20% for property, plant and
equipment.

  - Its debt waterfall includes senior secured debt in the form of
a USD100 million revolving credit facility (RCF), which Fitch
assumes will be fully drawn under the distressed scenario. It also
has USD50.8 million in secured loans from government agencies.
Unsecured debt totals USD355 million includes its USD350 million
notes and USD5 million loans from government agencies.

  - After deduction of 10% for administrative claims, its waterfall
analysis generated a ranked recovery in the RR4 band, indicating a
'CCC-' rating for the USD350 million notes. The waterfall analysis
output percentage on current metrics and assumptions was 48%.

RATING SENSITIVITIES

Factors that could, individually or collectively, lead to positive
rating action/upgrade:

  - Raising additional lines of financing towards USD350 million
bond repayment

  - Improvement in the debt maturity profile

Factors that could, individually or collectively, lead to negative
rating action/downgrade:

  - Limited progress with refinancing options and further
deterioration in liquidity profile

LIQUIDITY AND DEBT STRUCTURE

Funded for Next 12 Months: As of end-March 2020 Ferroglobe had a
cash position of USD144.5 million, which increased from USD123.2
million at end-2019 due to a strong working capital inflow of
USD109.9 million in 1Q20. This means Ferroglobe is well-funded over
the next 12 months, given USD36.2 million in debt maturities by
end-2020 and forecast negative FCF of USD48 million over
2020-2021.

Ferroglobe raised additional financing in October 2019 in the form
of a USD100 million RCF backed by North American receivables and
inventories. Its accounts receivable securitisation has been
amended to USD150 million, from USD200 million in February 2019, to
now only consist of accounts receivable from the Spanish and French
subsidiaries.

Refinancing of the USD350 million unsecured notes due in March 2022
has become less likely as its more liquid assets have already been
pledged and EBITDA generation is lacklustre. The RCF matures in
October 2024 but includes a spring-forward covenant, which comes
into effect three months before the USD350 million notes maturity.
Due to this provision Fitch does not view this facility as being
available for refinancing the notes. The accounts receivable
securitisation programme matures on December 10, 2021 and is not a
source of repayment of the notes.

Ferroglobe's debt structure currently consists mainly of the USD350
million notes due in March 2022. Its USD150 million accounts
receivable securitisation was USD75 million-utilised at end-March
2020. Its USD100 million RCF was USD38 million-drawn as of
end-March 2020. Finally, it has government loans totalling USD55.8
million, of which USD23.1 million are coming due in 2020.

ESG CONSIDERATIONS

The highest level of ESG credit relevance, if present, is a score
of 3. This means ESG issues are credit-neutral or have only a
minimal credit impact on the entity(ies), either due to their
nature or to the way in which they are being managed by the
entity(ies).


GO OUTDOORS: JD Sports Buys Back Business From Administrators
-------------------------------------------------------------
Business Sale reports that JD Sports has bought back retail chain
Go Outdoors after placing it into administration earlier in the
week.

According to Business Sale, the company claims that the deal, which
is said to be structured as a pre-pack administration sale, will
preserve "as many jobs as possible" and honours existing agreements
with suppliers.

Michael Magnay and Daniel Butters of Deloitte had been appointed as
administrators for Go Outdoors, but it has now been reacquired by
JD Sports, with the fee claimed to be GBP56.5 million, Business
Sale relates.  JD Sports says the company has a potential future
within its group if it is "fundamentally restructured", Business
Sale notes.

JD Sports says the majority of staff will transfer as part of the
pre-pack deal and the aim will be for most stores to continue
trading, Business Sale relays.  All stores will initially remain
open for a year, during which time JD Sports will attempt to
negotiate more favorable terms with landlords, according to
Business Sale.

It is unknown whether JD Sports determined the minimum deal price
for Go Outdoors in relation to potential bids from competitors,
Business Sale notes.

According to Business Sale, Michael Magnay, joint administrator,
commented: "Like many high street retailers, Go Outdoors Ltd has
been seeking to address a number of underlying business challenges
in the current UK retail environment, which have been exacerbated
by the impact of COVID-19."


GOLDENTREE LOAN 4: S&P Assigns Prelim B-(sf) Rating on Cl. F Notes
------------------------------------------------------------------
S&P Global Ratings assigned preliminary credit ratings to
GoldenTree Loan Management EUR CLO 4 DAC's class A to F European
cash flow CLO notes. At closing, the issuer will issue unrated
subordinated notes.

The preliminary ratings reflect S&P's assessment of:

-- The diversified collateral pool, which consists primarily of
broadly syndicated speculative-grade senior-secured term loans and
bonds that are governed by collateral quality tests.

-- The credit enhancement provided through the subordination of
cash flows, excess spread, and overcollateralization.

-- The collateral manager's experienced team, which can affect the
performance of the rated notes through collateral selection,
ongoing portfolio management, and trading.

-- The transaction's legal structure, which S&P expects to be
bankruptcy remote.

-- The transaction's counterparty risks, which S&P expects to be
in line with its counterparty rating framework.

  Portfolio Benchmarks
                                                  Current
  S&P weighted-average rating factor            2,760.164
  Default rate dispersion                         532.722
  Weighted-average life (years)                     5.285
  Obligor diversity measure                       104.914
  Industry diversity measure                       18.577
  Regional diversity measure                        1.368
  
  Transaction Key Metrics
                                                  Current
  Portfolio weighted-average rating
   derived from our CDO evaluator                     'B'
  'CCC' category rated assets (%)                    2.50
  Covenanted 'AAA' weighted-average recovery (%)    37.55
  Covenanted weighted-average spread (%)             3.40
  Covenanted weighted-average coupon (%)             3.50

Under the transaction documents, the rated notes will pay quarterly
interest unless a frequency switch event occurs. Following this,
the notes will switch to semiannual payments. The portfolio's
reinvestment period will end approximately one year after closing.

S&P said, "We understand that at closing the portfolio will be
well-diversified, primarily comprising broadly syndicated
speculative-grade senior-secured term loans and senior-secured
bonds. Therefore, we have conducted our credit and cash flow
analysis by applying our criteria for corporate cash flow CDOs.

"In our cash flow analysis, we used the EUR375 million target par
amount, the covenanted weighted-average spread (3.40%), the
reference weighted-average coupon (3.50%), and the target minimum
weighted-average recovery rates as indicated by the collateral
manager. We applied various cash flow stress scenarios, using four
different default patterns, in conjunction with different interest
rate stress scenarios for each liability rating category.

"Under our structured finance sovereign risk criteria, we consider
that the transaction's exposure to country risk is sufficiently
mitigated at the assigned preliminary ratings."

Until the end of the reinvestment period on July 20, 2021, the
collateral manager may substitute assets in the portfolio for so
long as our CDO Monitor test is maintained or improved in relation
to the initial ratings on the notes. This test looks at the total
amount of losses that the transaction can sustain as established by
the initial cash flows for each rating, and it compares that with
the current portfolio's default potential plus par losses to date.
As a result, until the end of the reinvestment period, the
collateral manager may through trading deteriorate the
transaction's current risk profile, as long as the initial ratings
are maintained.

S&P said, "At closing, we expect that the transaction's documented
counterparty replacement and remedy mechanisms will adequately
mitigate its exposure to counterparty risk under our current
counterparty criteria.

"We expect the transaction's legal structure and framework to be
bankruptcy remote, in line with our legal criteria.

"Following our analysis of the credit, cash flow, counterparty,
operational, and legal risks, we believe our preliminary ratings
are commensurate with the available credit enhancement for the
class A to F notes. Our credit and cash flow analysis indicates
that the available credit enhancement could withstand stresses
commensurate with the same or higher rating levels than those we
have assigned. However, as the CLO will be in its reinvestment
phase starting from closing, during which the transaction's credit
risk profile could deteriorate, we have capped our preliminary
ratings assigned to the notes.

"In light of the rapidly shifting credit dynamics within CLO
portfolios due to continuing rating actions (downgrades,
CreditWatch placements, and outlook changes) on speculative-grade
corporate loan issuers, we are making qualitative adjustments to
our analysis when rating CLO tranches to reflect the likelihood
that changes to the credit profile of the underlying assets may
affect a portfolio's credit quality in the near term. This is
consistent with paragraph 15 of our criteria for analyzing CLOs."
To do this, S&P reviews the likelihood of near-term changes to the
portfolio's credit profile by evaluating the transaction's specific
risk factors, including, but not limited to, the percentage of the
underlying portfolio that comes from obligors that:

-- Are rated in the 'CCC' range;
-- Are currently on CreditWatch with negative implications;
-- Are rated with a negative outlook; or
-- Sit within a static portfolio CLO transaction.

Based on S&P's review of these factors, and considering the
portfolio concentration, it believes that the minimum cushion
between this CLO's break-even default rates (BDRs) and scenario
default rates (SDRs) should be 1.0% (from a possible range of
1.0%-5.0%).

As noted, the purpose of this analysis is to take a forward-looking
approach for potential near-term changes to the underlying
portfolio's credit profile.

S&P said, "Taking the above factors into account and following our
analysis of the credit, cash flow, counterparty, operational, and
legal risks, we believe that our preliminary ratings are
commensurate with the available credit enhancement for all of the
rated classes of notes.

"In addition to our standard analysis, to provide an indication of
how rising pressures among speculative-grade corporates could
affect our ratings on European CLO transactions, we have also
included the sensitivity of the ratings on the class A to E notes
to five of the 10 hypothetical scenarios we looked at in our recent
publication.

"As our rating analysis makes additional considerations before
assigning ratings in the 'CCC' category, and we would assign a 'B-'
rating if the criteria for assigning a 'CCC' category rating are
not met, we have floored the class F notes at 'B-'."

S&P Global Ratings acknowledges a high degree of uncertainty about
the rate of spread and peak of the coronavirus outbreak. S&P said,
"Some government authorities estimate the pandemic will peak about
midyear, and we are using this assumption in assessing the economic
and credit implications. We believe the measures adopted to contain
COVID-19 have pushed the global economy into recession. As the
situation evolves, we will update our assumptions and estimates
accordingly."

The transaction securitizes a portfolio of primarily senior-secured
leveraged loans and bonds, and it will be managed by GoldenTree
Loan Management II LP.

  Ratings List

  Class    Prelim.   Prelim.   Interest   Credit enhancement (%)   

           Rating    amount     rate (%)
                     (mil. EUR)
  A        AAA (sf)   221.00    3mE + 1.55     41.07  
  B-1      AA (sf)    26.50     3mE + 2.30     31.33
  B-2      AA (sf)    10.00     2.60           31.33
  C        A (sf))    25.00     3mE + 2.80     24.67
  D        BBB (sf)   25.00     3mE + 4.10     18.00
  E        BB (sf)    18.70     3mE + 5.50     13.01
  F        B- (sf)    9.70      3mE + 6.75     10.43
  Sub      NR         37.80     N/A            N/A

  NR--Not rated.
  N/A--Not applicable.
  3mE--Three-month Euro Interbank Offered Rate.


LONDON CAPITAL: FRC Set to Announce Probe on Three Auditors
-----------------------------------------------------------
Tabby Kinder at The Financial Times reports that the UK accounting
watchdog is set to announce an investigation into the three
auditors of collapsed investment business London Capital & Finance,
according to people familiar with the situation.

Big Four accountants EY and PwC, as well as Oliver Clive & Co, a
small London-based firm, each signed off LCF's books for three
years before it went into administration in January 2019, in a
high-profile scandal related to the mis-selling of mini-bonds, the
FT relates.

According to the FT, the people said the Financial Reporting
Council is poised to announce an investigation into potential
breaches by the auditors as early as this week.

Meanwhile, liquidators to LCF at FRP Advisory, a London-listed
insolvency firm, are also exploring whether to bring legal action
against the audit firms, the FT relays, citing people familiar with
the situation.

LCF collapsed almost 18 months ago after the UK regulator, the
Financial Conduct Authority, froze its bank accounts and said its
marketing of unregulated mini-bonds promising returns of 8% was
misleading, the FT recounts.

The company's creditors, who are a group of 11,500 individual
retail investors, are owed a total of GBP236 million, the FT
discloses.  They are expected to get back just 25% of this amount
they put into the firm after it emerged that millions of pounds
went into the personal possession of four executives, the FT
states.

The scandal has prompted an investigation by the Serious Fraud
Office, which is ongoing, and an overhaul of how mini-bonds are
marketed in the UK, according to the FT.


MOORFIELD HOTEL: Owner Opts to Close Hotel, 45 Jobs Affected
------------------------------------------------------------
BBC News reports that the Moorfield Hotel in Brae is to close with
the loss of 45 jobs.

BDL Shetland, the owner of the hotel, said it was no longer viable
to keep it open, BBC relates.

The decision came after Total said it would move workers to an
accommodation camp at Sella Ness which is nearer the gas terminal,
BBC notes.

According to BBC, Total said in a statement: "From August, workers
at the Shetland Gas Plant who require accommodation when working on
the island will stay at the Sella Ness facility rather than the
Moorfield Hotel.

"A five-year contract for accommodation at Sella Ness has been
agreed that will allow for a significant reduction in the cost of
worker accommodation, whilst also providing the level of comfort
our workforce expects."


VALARIS PLC: Egan-Jones Lowers Sr. Unsecured Debt Ratings to C
--------------------------------------------------------------
Egan-Jones Ratings Company, on June 16, 2020, downgraded the
foreign currency and local currency senior unsecured ratings on
debt issued by Valaris PLC to C from CC. EJR also downgraded the
rating on commercial paper issued by the Company to D from C.

Headquartered in London, United Kingdom, Valaris PLC provides
offshore contract drilling services.



                           *********


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.

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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,
contact Peter Chapman at 215-945-7000.


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