/raid1/www/Hosts/bankrupt/TCREUR_Public/200812.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
E U R O P E
Wednesday, August 12, 2020, Vol. 21, No. 161
Headlines
F R A N C E
CERELIA PARTICIPATION: S&P Assigns B LT ICR, Outlook Negative
G E R M A N Y
[*] German Coalition in Dispute Over Bankruptcy Freeze Extension
[*] GERMANY: Corporate Insolvencies Down 9.9% in May 2020
I R E L A N D
CITYJET: High Court Approves Survival Scheme; Exits Examinership
[*] IRELAND: Level of Corporate Insolvencies May Peak in 2021
R O M A N I A
BLUE AIR: Romanian Gov't. Grants State Aid to Avert Bankruptcy
ROMAERO: To Borrow RON60 Million to Finance Restructuring Plan
S L O V E N I A
AGROKOR: AVK Ordered to Return Seized Mercator Holdings
S P A I N
CAIXABANK CONSUMO 2: Fitch Affirms Class B Notes Rating at BBsf
U N I T E D K I N G D O M
DEBENHAMS PLC: To Cut 2,500 More Jobs Amid Coronavirus Pandemic
NOBLE CORPORATION: Case Summary & 50 Largest Unsecured Creditors
NOBLE CORPORATION: Files Chapter 11 to Facilitate Restructuring
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F R A N C E
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CERELIA PARTICIPATION: S&P Assigns B LT ICR, Outlook Negative
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S&P Global Ratings assigned its 'B' long-term issuer credit rating
to France-based ready-to-bake dough producer Cerelia Participation
Holding SAS (Cerelia) and its 'B' issue rating and '3' recovery
rating to the group's EUR420 million term loan B (TLB).
The ratings are line with the preliminary ratings S&P assigned on
July 2, 2020.
Cerelia's appetite for expansion and equity-sponsor ownership limit
the case for pronounced deleveraging. Ardian announced on Dec. 19,
2019, that it had acquired a 78.2% stake in Cerelia from IK
Investment Partners (including shareholder loans, the remaining
21.8% stake stays with the existing management team). Cerelia is a
pie and pizza dough manufacturer with most of its revenue coming
from the retail private label channel in Western Europe. To support
the transaction, Cerelia issued a new EUR420 million TLB and a
EUR100 million RCF, and we project these issuances will lead to an
S&P Global Ratings-adjusted debt-to-EBITDA ratio of 6x-7x and funds
from operations (FFO) cash interest coverage of 3x-4x. We estimate
adjusted debt will amount to EUR460 million-EUR470 million,
including our estimate of EUR24 million of operating lease
commitments, EUR12 million of factored receivables, and EUR4
million of pension-related liabilities. S&P excludes the
shareholder loans from our debt metrics since we view them as
non-debt like. S&P typically believes that the private equity-owned
sponsors' interest in deleveraging is low.
Cerelia's small size and relatively narrow product offering in
niche categories constrain the group's creditworthiness, in S&P's
view. The group is present in three main staple food categories
that have a short shelf life: Ready-to-bake dough (76%);
ready-to-heat pancakes (19%); and baked goods (5%). The market is
expected to experience low-single-digit growth owing to the need
for more convenience and preparation shortcuts for home baking, and
is protected by barriers to entry as production lines are highly
specialized for each product category. In S&P's view, the group
will likely exceed this growth rate, reporting mid-single-digit
growth thanks to its leading position in its categories. The group
has a market share greater than 90% in pie dough in France and
Italy, as well as strong growth prospects for both the pizza and
pancake markets in Europe. Cerelia should also benefit from an
increasing penetration of private labels in its core markets since
it offers attractive margins for retailers. S&P understands that
the group has been performing well overall in the COVID-19
environment, reflecting its position as a staple food manufacturer.
The growth in the large European business was partially subdued by
the lower demand in the food service division, which accounts for
about 50% of revenue in North America and about 15% in the
Netherlands.
Profit volatility can arise from the combination of high price
pressure in retail and time gap to rise prices following raw
material inflation. Cerelia derives the vast majority of its
volume production in the private label segment (67% of total
revenue). Its branded offer brings in 11% of sales, where it
retains some pricing power especially from its JAN brand
(pancakes). The retail environment remains weak, and we believe
that Cerelia's customers will continue to demand more pricing
concessions from their private label manufacturers, especially
given the concentrated retailers' landscape. Although some
pass-through mechanisms exist, especially in France, they often
come through with a delay (6-12 months on average), temporarily
squeezing margins. This occurred in fiscal 2018 when both butter
and eggs prices surged--due to the Fipronil eggs contamination and
the global butter shortage in 2017--denting margins by more than
300 basis points. S&P said, "We anticipate the group will be able
to mitigate material exposure in the next 12-18 months, thanks to
its diversified and uncorrelated material base. We also note that
the group prudently monitors price exposure, having secured
coverage of its main raw materials for the next 12-18 months."
Cerelia has unequalled volume coverage in its categories in Europe,
along with high quality and reliability standards. The group's
production capacity is double that of its next competitor, enabling
the group to capture volumes from both its private label and
co-packing businesses from large food companies. This currently
represents 6% of sales and is expected to drive growth.
Furthermore, Cerelia has a small number of brands, enabling it to
offer retailers mainstream and premium products with the same high
level of quality. Brands also allow innovation creation. By
providing more value than a simple supplier, Cerelia is able to
defend its market shares. The company is a key provider to all
European retailers in these categories, and S&P believes these
substantial volumes secure its relationships with these clients.
Strong local manufacturing footprint and innovation support
margins. Cerelia has eight factories across Europe and four in
North America (down to three over the coming 12-18 months after the
closing of one site in Canada). The group's reach enables it to
effectively meet clients' needs in terms of volume and quality in
each of the group's geographies. In addition, the company has a
strong focus on innovation. Cerelia was the first company to launch
gluten-free dough products and palm oil-free pie dough, and these
products may give way to strong growth prospects and better
margins. Cerelia intends to increase its position toward a premium
product offering (6% of sales in 2019) to capture additional growth
in these segments. S&P said, "Moreover, we believe the group's
plans to expand its portfolio of healthier food products will
cushion its profitability from the impact of changing consumer
preferences. In our assessment, we believe that the group operates
at a profitable level (estimated at around 15%-16% EBITDA margin)
in Western Europe in the private label category."
Elevated capex to support the company's capacity expansion and
automation projects will constrain cash flow over the next two
years. Cerelia is investing heavily in infrastructure and
automation projects, including in the development of additional
pancake lines in the U.K., a greenfield project of a new factory in
the U.S. in Ohio (which should be operational by the end of fiscal
2022), as well as in France (by the start of fiscal 2023). These
projects should help optimize logistics planning and the flow of
materials while increasing industrial capacities. Despite
anticipated higher working capital needs given the increased
production volumes, S&P sees the business overall as having low
seasonality and moderate intra-year working capital swings.
Expansion in the U.S. to secure growth doesn't come without sizable
investments and potential execution risks. S&P said, "We recognize
Cerelia's successful track record of expanding its operations in
its core categories over the past few years. The group entered
Canada through its acquisition of English Bay Batter, then expanded
into the U.S. via a food services distribution and in-store bakery
channel. France represents about 30% of the group's sales, while
sales outside Europe account for about 22%, and we understand the
company intends to increase the proportion going forward. We
believe expansion outside Europe will be challenging since Cerelia
is less established and lacks scale. The U.S. business displayed
low and declining margins over the past years due to several
factors, including high transportation costs, low automation, and
some low-margin contracts. We anticipate management's investment
plan will foster margin turnaround in the next years. Although we
believe the group has room to adapt its growth plans to trim costs
if needed, investments are bound to be large even for a downscaled
expansion plan." Furthermore, there are execution risks in
developing a portfolio of clients in a highly competitive markets
in order to secure its greenfield project. That said, the U.S.
represents a larger market with positive trends in private label.
S&P Global Ratings acknowledges a high degree of uncertainty about
the evolution of the coronavirus pandemic. The consensus among
health experts is that the pandemic may now be at, or near, its
peak in some regions but will remain a threat until a vaccine or
effective treatment is widely available, which may not occur until
the second half of 2021. S&P said, "We are using this assumption in
assessing the economic and credit implications associated with the
pandemic. As the situation evolves, we will update our assumptions
and estimates accordingly."
S&P said, "The negative outlook reflects risks that Cerelia may
underperform our base case of S&P Global Ratings-adjusted debt to
EBITDA of about 6x-7x and that FOCF could remain largely negative
over the next two years. This is because we factor the group's
ambitious capital investment plans, with over EUR100 million to be
spent in fiscals 2021 and 2022, notably in North America, mitigated
to some extent by asset sales. There, we see risks that the group
may be unable to lift profitability due to a lack of existing
customer relationships and high price pressure from retailers and
competitors. We also consider uncertainties related to the recovery
in the food service channel in North America and the lasting effect
of high-single-digit retail sales growth observed over the past few
months in Europe.
"We could lower the rating if we see a high probability of
persisting materially negative FOCF due to large upcoming
investments or the FFO cash interest coverage ratio approaching 2x
in the next 12-18 months. This could come from observed project
cost overruns and delays on the large capex program, weak volume
growth in Europe, or a deterioration in the EBITDA margin due to a
sharp increase in raw material costs.
"We might revise the outlook to stable if we were to gain
visibility on new contracts and customer wins that could signal
strong earnings growth in North America, which would reduce risks
of negative FOCF." An outlook revision to stable would also hinge
on sustained debt deleveraging between 6x-7x in the next 12-18
months and FFO cash interest coverage of around 3x-4x. The latter
could arise from significant new contracted revenues in North
America locked at a profitable level, a gradual recovery in the
food service channel in the U.S., and steady operating performance
in Europe, which accounts for the majority of the group's
earnings.
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G E R M A N Y
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[*] German Coalition in Dispute Over Bankruptcy Freeze Extension
----------------------------------------------------------------
Michael Nienaber and Andreas Rinke at Reuters report that Germany's
ruling coalition is at odds over extending a freeze on insolvency
rules put in place to avoid a wave of corporate bankruptcies due to
the coronavirus crisis.
In March, the government gave companies that find themselves in
financial trouble due to the pandemic a respite by allowing them to
delay filing for bankruptcy until the end of September, Reuters
recounts.
Over the weekend, Justice Minister Christine Lambrecht, of the
co-governing Social Democrats (SPD), set out a proposal to extend
the freeze until the end of March 2021, but the plan drew criticism
from senior lawmakers from Chancellor Angela Merkel's conservatives
on Aug. 10, Reuters relates.
"We have to be careful that we don't drag along any zombie
companies that already had no future even before the coronavirus
crisis," Joachim Pfeiffer, chief lawmaker for economic policy in
Merkel's parliamentary group, told Reuters.
According to Reuters, Hans Michelbach from the Bavarian CSU sister
party warned that a long extension of the freeze would actually not
reduce, but increase economic problems and should finish by the end
of the year at the latest.
The freeze on bankruptcy filings has contributed to a drop in the
number of corporate insolvencies despite the coronavirus crisis
plunging Europe's biggest economy into its deepest recession during
peacetime, Reuters notes.
[*] GERMANY: Corporate Insolvencies Down 9.9% in May 2020
---------------------------------------------------------
Xinhua reports that the number of business insolvencies among
German companies decreased by 9.9% in May year-on-year to just
above 1,500, the country's Federal Statistical Office (Destatis)
announced on Aug. 10.
However, Destatis noted that economic problems caused by COVID-19
had not yet been reflected by an increase in insolvencies due to
the government suspension of filing for insolvency implemented in
March, Xinhua relates.
The highest number of corporate insolvencies in May was registered
in Germany's trade sector with 247 insolvencies, followed by 235
insolvency applications signed by companies from the construction
sector, Xinhua discloses.
Preliminary figures for July also showed a "marked decline in the
number of proceedings" as the year-on-year figure fell by almost
30%, Xinhua states.
According to Xinhua, despite the low insolvency numbers, the German
Halle Institute for Economic Research (IWH) announced last week
that corporate bankruptcies in Germany impacted more than three
times as many jobs compared with the monthly averages from the
start of the year, with "more, large companies going bankrupt."
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I R E L A N D
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CITYJET: High Court Approves Survival Scheme; Exits Examinership
----------------------------------------------------------------
Aodhan O'Faolain and Ray Managh at The Irish Times report that the
High Court has formally approved a survival scheme allowing
regional airline CityJet to successfully exit examinership.
According to The Irish Times, the approved scheme will allow the
Dublin-based airline continue as a going concern, on what was
described on "a slimmed down" basis, with more than 140 jobs at the
company being retained.
It had previously employed more than 400 at its Dublin base, The
Irish Times notes.
Mr. Justice Michael Quinn said he was satisfied to approve a scheme
put together by the airline's examiner Kieran Wallace of KPMG,
which will allow the airline formally exit examinership, The Irish
Times relates.
The scheme, supported by a majority of the airline's creditors and
shareholders, also sees tens of millions of euro of its debt being
written off, The Irish Times discloses.
Last April, the airline sought the protection of the courts,
claiming it was insolvent due to financial difficulties which were
exacerbated after its aircraft were grounded due to the Covid-19
outbreak, The Irish Times recounts.
The airline said it had debts of EUR500 million, and at the time of
entering the examinership process, had a net deficit of liabilities
over assets on a going concern basis of EUR186 million, The Irish
Times relays.
Approving the scheme, Mr. Justice Quinn accepted that creditors
would do better under the examiner's proposals compared to if the
airline was liquidated, which the court was told was the only
alternative to the scheme, The Irish Times notes.
[*] IRELAND: Level of Corporate Insolvencies May Peak in 2021
-------------------------------------------------------------
Joe Brennan at The Irish Times reports that the level of corporate
insolvencies in Ireland may peak next year at levels last seen at
the end of the financial crisis as the real cost of the Covid-19
economic shock on businesses becomes apparent, according to a
leading insolvency expert.
"In the short-term my prediction is that insolvency numbers will
return in 2021 to the worst numbers of the last recession," The
Irish Times quotes Neil Hughes, insolvency practitioner and
managing partner of Baker Tilly Chartered Accountants in Ireland,
as saying. "However, I expect them to drop back down sharply again
in 2022."
Covid-19 restrictions served as a catalyst for some high-profile
business collapses in the second quarter of the year, with
department store chain Debenhams Ireland, the Irish arms of fashion
outlets Oasis and Warehouse, and the Usit travel group among local
names succumbing to liquidation, The Irish Times discloses.
However, insolvencies fell 12% in the first half of this year to
273, Deloitte said last month, as firms, particularly in the retail
and hospitality sectors, were supported by government salary
support schemes and the freezing of certain fixed costs even as the
economy went into lockdown in March, The Irish Times relays.
Yet analysts expect that the level of companies going under will
start to creep up in the second half of this year despite the
cushioning effect from the Government's EUR7.4 billion stimulus
plan, which was unveiled last month, The Irish Times states. They
said insolvencies are expected to peak in 2021 even if the wider
economy is in recovery mode, The Irish Times notes.
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R O M A N I A
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BLUE AIR: Romanian Gov't. Grants State Aid to Avert Bankruptcy
--------------------------------------------------------------
SeeNews reports that Romania's government has issued a draft
emergency decree granting RON613.5 million (US$150 million/EUR127
million) in aid to state-owned airline Tarom and low-cost carrier
Blue Air in order to help them avoid bankruptcy due to the COVID-19
pandemic.
"In the absence of state aid, there is a high probability that
Tarom and Blue Air will default and eventually go bankrupt," the
draft decree published on the transport ministry's website reads.
If adopted, the proposed state aid will need the approval of the
European Commission in order to be disbursed, SeeNews notes.
Tarom would receive RON312.74 million, while Blue Air would get
RON300.77 million under the draft decree which was open for
discussion until Aug. 10, SeeNews discloses.
By April 30, 2021, the two companies must submit to the relevant
authorities an economic and financial analysis by an independent
financial auditor to show the real value of the damage caused
directly by the pandemic between March 1 and December 31 of 2020,
SeeNews states. If the losses are lower than the proposed state
aid, the difference shall be returned to the state, SeeNews notes.
In June, Tarom said it expects its net loss to widen to RON315
million this year from RON171.4 million in 2019, SeeNews
discloses.
In July, privately-held Blue Air said that the Bucharest municipal
court has approved its request to enter a concordat procedure with
its creditors in order to avoid insolvency after the pandemic
dented its revenues, SeeNews recounts.
ROMAERO: To Borrow RON60 Million to Finance Restructuring Plan
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Nicoleta Banila at SeeNews reports that Romanian aircraft
manufacturer Romaero will borrow RON60 million (US$14.7
million/EUR12.5 million) from local state-owned CEC Bank to finance
a large-scale restructuring plan, insolvency manager CIT
Restructuring said on Aug. 5.
CIT Restructuring said in a press release some RON45 million from
the loan will be used to pay debts to the national fiscal agency
ANAF, while RON14 million will be used as working capital in order
to relaunch operations, SeeNews relates. This will be Romaero's
first bank loan since 2009, SeeNews notes.
According to SeeNews, the restructuring plan envisages reduction of
debts to the consolidated state budget by approximately RON256
million and transfer of essential assets to institutions active in
the defense sector. In addition, historical bank loans amounting
to some RON108 million will be paid after selling some surplus
assets that the business no longer needs, SeeNews states.
CIT Restructuring added that with the implementation of these
measures and with debt restructuring, the company will be able to
attract fresh funding that it will direct towards investments in
technology, SeeNews discloses.
The debt restructuring plan was developed by CIT Restructuring, and
was approved by the Romaero shareholders on Aug. 3, SeeNews
recounts.
Established in 1920, Romaero is an aerospace company that
integrates two major activities: aerostructure manufacturing and
maintenance and repair for civil and military transport aircraft.
It is located near Bucharest's Baneasa Airport and employs 772.
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S L O V E N I A
===============
AGROKOR: AVK Ordered to Return Seized Mercator Holdings
-------------------------------------------------------
SeeNews reports that Slovenia's supreme court has ruled that the
competition protection agency, AVK, has to return without delay to
Croatia's Agrokor its holdings in Slovenian retailer Mercator that
were temporarily seized last year, Agrokor's successor, Fortenova
Group, said on July 30.
"The Supreme Court declared the seizure of shares to be unlawful,
arguing that AVK had no legal grounds to issue a ruling to seize
the shares," SeeNews quotes Fortenova, to which the Mercator shares
are to be transferred, as saying in a statement.
In December, AVK decided to temporarily seize Agrokor's holdings in
Mercator to ensure the enforcement of a non-final ruling that
imposed a 53.9 million euro ($63.3 million) penalty on Agrokor for
its failure to notify the competition authority about its 2016
acquisition of UAE-based Ardeya Global--owner of Slovenian water
bottler Costella.
In June, however, the Ljubljana district court reduced the EUR53.9
million fine imposed by AVK on Agrokor to just EUR1 million,
SeeNews recounts.
The business operations of troubled food-to-retail concern Agrokor
were transferred to the newly formed Fortenova Group in April 2019
under a debt settlement agreement with Agrokor's creditors endorsed
by a Zagreb court in June 2018, SeeNews discloses.
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S P A I N
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CAIXABANK CONSUMO 2: Fitch Affirms Class B Notes Rating at BBsf
---------------------------------------------------------------
Fitch Ratings has affirmed Caixabank Consumo 2, FT's notes, as
follows:
CaixaBank Consumo 2, FT
- Class A ES0305137004; LT A+sf; Affirmed
- Class B ES0305137012; LT BBsf; Affirmed
TRANSACTION SUMMARY
The transaction is a static cash securitisation of unsecured
consumer loans (unsecured loans) and consumer loans secured by
first-and second-lien real estate and consumer drawdowns of related
mortgage lines (together the RE secured loans), extended to
obligors in Spain by CaixaBank S.A (BBB+/Negative/F2; deposit
rating A-/F2), which is also the account bank.
KEY RATING DRIVERS
Coronavirus-related Revision to Assumptions:
Fitch expects defaults and delinquencies to increase beyond
recently observed levels as a result of the coronavirus crisis. The
severity of the shock is likely to be unprecedented. However, the
scale of the impact may be partially offset by measures taken by
the servicer and the Spanish government, which are in stark
contrast to the austerity measures of 2010.
Nevertheless, Fitch foresees a material deterioration in
performance and accordingly it has recalibrated its asset
assumptions; For the RE secured sub-portfolio, Fitch has applied
additional stress scenario analysis in conjunction with its
European RMBS Rating Criteria in response to the coronavirus
outbreak and the recent legislative developments in Catalonia dated
July 10, 2020.
In addition to its baseline stress, Fitch also considers a downside
coronavirus scenario for sensitivity purposes whereby a more severe
and prolonged period of stress is assumed. Under this scenario,
Fitch's analysis accommodates a 15% increase to the portfolio
weighted average foreclosure frequency and a 15% decrease to the WA
recovery rates.
Fitch has performed an arrears adjustment sensitivity, which
consists of increasing the rating default rate by 10% to capture
the possible build-up of arrears in the following months due to the
financial crisis related to the coronavirus. Fitch has not applied
an additional stress for payment holidays due to the low exposure
for the secured sub-portfolio (11% as of June 2020), which is
slightly above the Spanish market average (of approximately 10, the
temporary nature of payment holidays and the combined waterfalls in
the transaction.
Moreover, for the unsecured sub-portfolio, Fitch revised the
default base case to 7.5% compared with 4.0% from previous review
while the 'AAA' default multiple has been reduced to 4.0x from 5.0x
to reflect the significant stress captured by the base case. The
recovery base case and 'AAA' haircut are unchanged at 30% and
47.5%, respectively, due to the already low base case as the assets
are unsecured. Payment holidays for the unsecured sub-portfolio are
at around 2%, which is comparable with other Spanish ABS deals and
very low compared with other jurisdictions.
Adequate Protection Against Credit Losses
Credit enhancement has continued to increase since the last review
as the transaction deleverages. CE as of April stands at around
64.0% (from 57.8%) for the class A notes and 18.3% (from 16.5%) for
the class B notes. CE for the class A notes is provided by the
reserve fund and subordination of the class B notes while for the
class B notes it is entirely provided by the reserve fund.
Off RWN
On April, Fitch placed the class B notes on Rating Watch Negative.
The RWN reflected the high probability of a downgrade of the class
B notes as a result of the coronavirus pandemic, considering that
the economic recession and increased unemployment could impair
borrowers' capacity to make payments, and the tranche's CE is
insufficient to compensate for additional projected losses on the
portfolio. After performing a full review and incorporating Fitch's
additional stresses due to capture the current financial crisis
related to the coronavirus Fitch has concluded that CE for the
class B notes is sufficient to withstand current ratings and
removed the notes from RWN and assigned a Stable Outlook.
Payment Interruption Risk Mitigated
Emergency support measures introduced in Spain include payment
moratoriums for consumer credit available to vulnerable borrowers.
However, Fitch views payment interruption risk as mitigated for
CaixaBank Consumo 2 up to a 'Asf' rating given the liquidity
(provided by the reserve fund), daily sweep of cash collections and
the servicer and collection account bank roles being performed by
CaixaBank, which is a regulated financial institution in a
developed market.
Account Bank Triggers Rating Cap
The rating of the notes is capped at 'A+sf' due to the account bank
replacement triggers set at 'BBB', which under Fitch's Structured
Finance and Covered Bonds Counterparty Rating Criteria is
insufficient to support 'AAsf' or 'AAAsf' ratings.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
- For the class A notes, modified account bank minimum
eligibility rating thresholds compatible with higher rating
categories 'AA+sf' or 'AAAsf' as per Fitch's Structured Finance and
Covered Bonds Counterparty Rating Criteria.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
- A longer-than-expected coronavirus crisis that deteriorates
macroeconomic fundamentals and the credit markets in Spain beyond
Fitch's current base case. This scenario will imply a downgrade to
'B'sf for the class B notes while the class A notes would not be
affected.
- A downgrade of Caixabank below the account bank minimum
eligibility rating thresholds and not remedied as per Fitch's
Structured Finance and Covered Bonds Counterparty Rating Criteria.
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
Fitch has checked the consistency and plausibility of the
information it has received about the performance of the asset
pools and the transactions. There were no findings that affected
the rating analysis. Fitch has not reviewed the results of any
third-party assessment of the asset portfolio information or
conducted a review of origination files as part of its ongoing
monitoring.
Prior to the transaction's closing, Fitch reviewed the results of a
third-party assessment conducted on the asset portfolio information
and concluded that there were no findings that affected the rating
analysis.
Overall, Fitch's assessment of the 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.
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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U N I T E D K I N G D O M
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DEBENHAMS PLC: To Cut 2,500 More Jobs Amid Coronavirus Pandemic
---------------------------------------------------------------
BBC News reports that struggling department store group Debenhams
says it will cut 2,500 more jobs as it struggles to survive the
coronavirus pandemic.
This is on top of the 4,000 announced since May, meaning the
retailer will have cut a third of its workforce, BBC notes.
The cuts will be mainly across its UK stores and distribution
centre, but it said no new shops were slated to shut, BBC relays.
According to BBC, Debenhams said the current trading environment
for retailers was still "a long way from returning to normal".
In April, the firm fell into administration for the second time in
a year as coronavirus heaped pressure on the business, BBC
recounts.
Earlier this year, it said 20 of its stores would remain
permanently closed because of the impact of the pandemic, according
to BBC.
Debenhams could remain in administration for the rest of this year,
as lenders wait to see how it performs post-lockdown and in the
crucial Christmas trading period, BBC discloses.
Like many of its competitors, the retailer was already ailing
before the pandemic forced it to suspend trading at its department
stores, BBC states.
NOBLE CORPORATION: Case Summary & 50 Largest Unsecured Creditors
----------------------------------------------------------------
Lead Debtor: Noble Corporation plc
10 Brook St.
London, United Kingdom W1S 1BG
Business Description: Noble-- www.noblecorp.com -- is an
offshore drilling contractor for the
oil and gas industry. The Company
provides contract drilling services to
the international oil and gas industry
with its global fleet of mobile
offshore drilling units. Noble focuses
on a balanced, high-specification fleet
of floating and jackup rigs and the
deployment of its drilling rigs in oil
and gas basins around the world.
Chapter 11 Petition Date: July 31, 2020
Court: United States Bankruptcy Court
Southern District of Texas
Forty affiliates that concurrently filed voluntary petitions for
relief under Chapter 11 of the Bankruptcy Code:
Debtor Case No.
------ --------
Noble Corporation plc (Lead Debtor) 20-33826
Bully 1 (Switzerland) GmbH 20-33829
Bully 2 (Switzerland) GmbH 20-33830
Noble 2018-I Guarantor LLC 20-33831
Noble 2018-II Guarantor LLC 20-33832
Noble 2018-III Guarantor LLC 20-33833
Noble 2018-IV Guarantor LLC 20-33835
Noble Asset Mexico LLC 20-33881
Noble BD LLC 20-33836
Noble Bill Jennings LLC 20-33883
Noble Cayman Limited 20-33837
Noble Cayman SCS Holding Limited 20-33838
Noble Contracting II GmbH 20-33839
Noble Corporation 20-33841
Noble Corporation Holdings Ltd 20-33843
Noble Corporation Holding LLC 20-33845
Noble Drilling (Guyana) Inc. 20-33846
Noble Drilling (TVL) Ltd 20-33850
Noble Drilling (U.S.) LLC 20-33851
Noble Drilling Americas LLC 20-33853
Noble Drilling Exploration Company 20-33854
Noble Drilling Holding LLC 20-33825
Noble Drilling International GmbH 20-33855
Noble Drilling NHIL LLC 20-33856
Noble Drilling Services Inc. 20-33857
Noble DT LLC 20-33862
Noble Earl Frederickson LLC 20-33884
Noble FDR Holdings Limited 20-33863
Noble Holding (U.S.) LLC 20-33865
Noble Holding International Limited 20-33867
Noble Holding UK Limited 20-33871
Noble International Finance Company 20-33872
Noble Leasing (Switzerland) GmbH 20-33874
Noble Leasing III (Switzerland) GmbH 20-33875
Noble Mexico Limited 20-33885
Noble Resources Limited 20-33876
Noble Rig Holding I Limited 20-33879
Noble Rig Holding II Limited 20-33880
Noble SA Limited 20-33877
Noble Services International Limited 20-33828
Judge: Hon. Marvin Isgur
Debtors'
Counsel: George N. Panagakis, Esq.
Anthony R. Joseph, Esq.
SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLP
155 N. Wacker Dr.
Chicago, Illinois 60606-1720
Tel: (312) 407-0700
Fax: (312) 407-0411
Email: george.panagakis@skadden.com
– and –
Mark A. McDermott, Esq.
Jason N. Kestecher, Esq.
Nicholas S. Hagen, Esq.
One Manhattan West
New York, New York 10001
Tel: (212) 735-3000
Fax: (212) 735-2000
Email: mark.mcdermott@skadden.com
jason.kestecher@skadden.com
Debtors'
Co-Counsel: John F. Higgins, Esq.
Eric M. English, Esq.
M. Shane Johnson, Esq.
Megan Young-John, Esq.
Emily D. Nasir, Esq.
PORTER HEDGES LLP
1000 Main St., 36th Floor
Houston, Texas 77002
Tel: (713) 226-6000
Fax: (713) 226-6248
Email: jhiggins@porterhedges.com
eenglish@porterhedges.com
sjohnson@porterhedges.com
myoung-john@porterhedges.com
enasir@porterhedges.com
Debtors'
Financial
Advisor: ALIXPARTNERS, LLP
Debtors'
Investment
Banker: EVERCORE GROUP L.L.C.
Debtors'
Claims &
Noticing
Agent and
Administrative
Advisor: EPIQ CORPORATEa RESTRUCTURING, LLC
https://dm.epiq11.com/case/noble/dockets
Total Assets as of March 31, 2020: $7,261,099,000
Total Liabilities as of March 31, 2020: $4,664,567,000
The petitions were signed by Richard B. Barker, chief financial
officer.
A copy of Noble Corporation's petition is available for free at
PacerMonitor.com at:
https://is.gd/LVFP53
Consolidated List of Debtors' 50 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
1. U.S. Bank Unsecured Debt $769,704,093
60 Livingston Ave. 7.875% Senior
St. Paul, MN 55107 Notes
Contact: Alejandro Hoyos
Email: alejandro.hoyos@usbank.com
2. JPMorgan Chase Bank, N.A. Unsecured Debt $549,995,940
712 Main Street Senior Revolving
5th Floor Facility
Houston, TX 77002
Contact: Gregory N Rostick
Email: gregory.n.rostick@chase.com
3. The Bank of New York Mellon Unsecured Debt $487,790,864
Trust Company, N.A. 5.250% Senior
601 Travis Street Notes
16th Floor
Houston, TX 77002
Contact: Lisa McCants
Email: lisa.mccants@bnymellon.com
4. Wilmington Trust, Unsecured Debt $459,162,987
National Association 7.950% Senior
1100 North Market Street Notes
Wilmington, DE 19801
Contact: Barry Somrock
Email: bsomrock@wilmingtontrust.com
5. Wilmington Trust, Unsecured Debt $407,441,506
National Association 7.750% Senior
1100 North Market Street Notes
Wilmington, DE 19801
Contact: Barry Somrock
Email: bsomrock@wilmingtontrust.com
6. The Bank of New York Mellon Unsecured Debt $402,770,127
Trust Company, N.A. 6.200% Senior
601 Travis Street Notes
16th Floor
Houston, TX 77002
Contact: Lisa McCants
Email: lisa.mccants@bnymellon.com
7. Wilmington Trust, Unsecured Debt $402,752,583
National Association 8.950% Senior
1100 North Market Street Notes
Wilmington, DE 19801
Contact: Barry Somrock
Email: bsomrock@wilmingtontrust.com
8. The Bank of New York Mellon Unsecured Debt $399,837,398
Trust Company, N.A. 6.050% Senior
601 Travis Street Notes
16th Floor
Houston, TX 77002
Contact: Lisa McCants
Email: lisa.mccants@bnymellon.com
9. The Bank of New York Mellon Unsecured Debt $81,435,197
Trust Company, N.A. 4.625% Senior
601 Travis Street Notes
16th Floor
Houston, TX 77002
Contact: Lisa McCants
Email: lisa.mccants@bnymellon.com
10. The Bank of New York Mellon Unsecured Debt $64,066,969
Trust Company, N.A. 4.900% Senior
601 Travis Street Notes
16th Floor
Houston, TX 77002
Contact: Lisa McCants
Email: lisa.mccants@bnymellon.com
11. The Bank of New York Mellon Unsecured Debt $21,505,749
Trust Company, N.A. 3.950% Senior
601 Travis Street Notes
16th Floor
Houston, TX 77002
Contact: Lisa McCants
Email: lisa.mccants@bnymellon.com
12. National Oilwell Varco Trade Debt $3,724,294
5100 North Sam Houston
Parkway West
Houston, TX 77086
Tel: 281-325-6533
Email: brian.wesneski@nov.com
13. Marks, Scott Deferred $2,851,188
Address on File Compensation
Tel: 832-520-5717
Email: scottmarks1113@gmail.com
14. Martin, Therald Deferred $2,159,174
Address on File Compensation
Tel: 281-202-8969
Email: therald.martin@yahoo.com
15. Madden, Thomas Deferred $857,405
Address on File Compensation
Tel: 713-410-4949
Email: maddenirl@aol.com
16. National Oilwell Varco LP Trade Debt $578,720
10353 Richmond Avenue
Houston, TX 77042
Tel: 713-346-7233
Email: noblesales@nov.com
17. Hpetroconsult Ltda Trade Debt $461,058
Barra D Tijuca
Rio De Janeiro 22640-102
Brazil
Tel: 22-2430-4500
Email: hpetroconsult@inforlink.com.br
18. National Oilwell Varco Trade Debt $365,166
Norway AS
Lagerveien 8
8181
Stavanger 4034
Norway
Tel: 47-5181-8181
Email: accountsreceivableafter
market@nov.com
19. Crane Worldwide Logistics Trade Debt $359,480
(Thailand)
589/110 20th Floor, Central City BA
Bangkok 10260
Thailand
Tel: 2745-6088-109
Email: supalerk.phitaksuteephong@craneww.com
20. Trasfor SA Trade Debt $337,665
Strada Cantonale 11
Molinazzo Di Monteggio 6998
Switzerland
Tel: 41-58-58- 84400
Email: pl-gbs_switzerland_ar@abb.com
21. Wolford, Bernie Deferred $261,850
Address on File Compensation
Tel: 832-600-7915
Email: berniewolford@gmail.com
22. Humes, Larry Deferred $246,587
Address on File Compensation
Email: txjhawkscomm@att.net
23. NOV Rig Solutions Pte Ltd. Trade Debt $239,534
29 Tuas Bay Drive
Singapore 637429
Singapore
Tel: 6594-1025
Email: adlin.abdulwahid@nov.com
24. Thornton, Bodley Deferred $217,298
Address on File Compensation
Tel: 713-823-4228
Email: bpthorntonsr@gmail.com
25. Bridon American Corporation Trade Debt $216,969
280 New Commerce Blvd
Wilkes-Barre, PA 18706
Tel: 570-822-3349-215
Email: hfisher@bridonamerican.com
26. Shell Oil Products US Trade Debt $192,712
PO Box 4749
Houston, TX 77210
Tel: 632-483-5942
Email: leanel.camporedondo@shell.com
27. Mings Products & Services Ltd. Trade Debt $184,662
6 Urquhart Street
Georgetown, Guyana
Tel: 592-225-3553-222
Email: ford.audrey@mps.gy
28. M & M International Inc. Trade Debt $172,285
1249 SE Evangeline Thruway
Broussard, LA 70518
Tel: 337-364-4145
Email: mmisales@mmvalve.com
29. Ameriforge Group Inc. Trade Debt $171,203
945 Bunker Hill Rd, Suite 500
Houston, TX 77024
Tel: 713-293-1245
Email: ar@afglobalcorp.com
30. Huisman North America Trade Debt $163,458
Services, LLC
2502 Wehring Road
Rosenberg, TX 77471
Tel: 832-490-1019
Email: accounting@huisman-na.com
31. Technip Umbilicals Inc. Trade Debt $146,752
16661 Jacintoport
Houston, TX 77015
Tel: 281-249-2711
Email: pbajo@technip.com
32. Speedcast Communications, Inc. Trade Debt $144,986
4400 S Sam Houston Pkwy E
Houston, TX 77048
Tel: 832-668-2459
Email: collections.america@speedcast.com
33. Hyundai Global Service Trade Debt $144,599
Americas o.
7206 Harms Road
Houston, TX 77041
Tel: 832-850-7659
Email: mhkim@hyundai-gs.com
34. Ocean Oilfield Trade Debt $132,961
Drilling Services
No. 8, Persiaran Melor Awana
Kijal
Kemaman 24100
Malaysia
Tel: 9864-0461
Email: accmy@oceanoilfield.com
35. Gulf Agency Co (Oman) LLC Trade Debt $130,907
PC 112, Ruwi, Sultanate of Oman
Ruwi 112
Oman
Tel: 244-77800-810
Email: jayaram.sethuraman@gac.com
36. American Bureau of Shipping Trade Debt $121,909
PO Box 24860
Dubai
United Arab Emirates
Tel: 4330-6000
Email: asoliman@eagle.org
37. Contitech Oil & Marine Trade Debt $120,786
Corporation
11535 Brittmoore Park Drive
Houston, TX 77041
Tel: 832-327-0141
Email: jocelyn.mangunsong@continental.com
38. GE Energy Power Trade Debt $109,507
Conversion USA Inc.
100 East Kensinger Drive, Ste 500
Cranberry Township, PA 16066
Tel: 412-967-0765
Email: gepays_Bid250060@ge.com
39. SPX Flow Oil and Gas Equipments Trade Debt $108,000
Plot No 29, Ali Khalifan Rashed
AL
6539
Abu Dhabi
United Arab Emirates
Tel: 971 2 408 190...
Email: thangam.r@spxflow.com
40. Gates & S Trading LLC Trade Debt $106,654
Al Quoz
12973
Dubai
United Arab Emirates
Tel: 6528-0801-262
Email: sadiqh@ahmed@gates.com
41. NOV Saudi Arabia Trading Co. Trade Debt $105,558
PO Box 52681
Dammam 20745
Saudi Arabia
Tel: 971 48 064204...
Email: jessy.kolencher@nov.com
42. Sodexo Remote Sites Trade Debt $104,183
Australia Pty Ltd
247 Balcatta Road
Perth, WA 6021
Australia
Tel: 892-42-0766
Email: accountsreceivable.amecaa.au@
sodexo.com
43. James, Ronald Deferred $101,808
Address on File Compensation
Tel: 281-851-0459
Email: rljames1128@gmail.com
44. Charter Supply Co. Trade Debt $99,570
8100 Ambassador Caffery Prky
81735
Broussard, LA 70518
Tel: 337-837-2724
Email: spicard@chartersupply.com
45. Gulf Agency Qatar Trade Debt $96,801
PO Box 6534
Doha Qatar
Tel: 974 323954
Email: shipaccounts.qatar@gac.com
46. FT Farfan Ltd. Trade Debt $96,644
#3-5 Ibis Avenue, Ibis Acres
San Juan
Trinidad and Tobago
Tel: 868-674-7896
Email: receivables@ftfarfan.com
47. Lamprell Energy Limited Trade Debt $92,505
Jebel Ali Free Zone, Gate 4
33455
Dubai
United Arab Emirates
Tel: 652-823-23-504
Email: sharmilas@lamprell.com
48. Eaglin, Michael Litigation
Arnold & Itkin LLP
6009 Memorial Drive
Houston, TX 77007
Email: karnold@arnolditkin.com
49. Paragon Litigation Trust Litigation
Kirkland & Ellis LLP
300 North Lasalle
Chicago, IL 60654
Tel: 312 862 2290
Email: patrick.nash@kirkland.com
50. Transocean Offshore Litigation
Reynolds Frizzell LLP
1100 Louisiana St., Ste 3500
Houston, TX 77002
Tel: 713-485-7200
Email: creynolds@reynoldsfrizzell.com
NOBLE CORPORATION: Files Chapter 11 to Facilitate Restructuring
---------------------------------------------------------------
Noble Corporation plc ("Noble" or "the Company") on July 31
disclosed that it has entered into a restructuring support
agreement (the "Agreement") with two ad hoc groups of the largest
holders of the Company's outstanding bond debt regarding a
consensual financial restructuring transaction that will
significantly deleverage the Company's balance sheet and position
the Company for long term growth.
The Agreement outlines, among other things, a comprehensive plan
for the elimination of all of the Company's bond debt, which
currently represents over $3.4 billion of debt, through the
cancellation and exchange of debt for new equity in the reorganized
company. As further support for the deleveraging transaction, the
Company's major bondholders have agreed to invest $200 million of
new capital in the form of new second lien notes. In addition, the
Company is expected to emerge with an enhanced liquidity position
supported by a new $675 million secured revolving credit facility
to be provided by its current syndicate of revolving credit
facility lenders, with JPMorgan Chase Bank, N.A. as administrative
agent. The significant reduction of debt and annual interest
expense, combined with a strong liquidity position, will enable the
Company to reorient itself toward future growth and value creation
for all stakeholders.
In order to implement the restructuring transaction, the Company
and selected subsidiaries have filed voluntary petitions for relief
under chapter 11 of the United States Bankruptcy Code in the United
States Bankruptcy Court for the Southern District of Texas (the
"Chapter 11 Cases"). The restructuring will be implemented through
a plan of reorganization that the Company expects to be confirmed
by this fall, allowing the Company's emergence from chapter 11
before year end.
The Company has sufficient capital to fund its worldwide operations
and does not require additional post-petition financing at this
time. Noble plans to continue to operate as normal and without
interruption for the duration of the restructuring and will
continue to pay employee wages and health and welfare benefits as
well as vendors in the normal course.
Robert Eifler, President and Chief Executive Officer, stated "Along
with many other businesses in our industry, Noble has been affected
by the severe downturn in commodity prices which has been
compounded by the Covid-19 pandemic. After many months exploring
our strategic options, we concluded that a substantial deleveraging
transaction implemented through a Chapter 11 filing, supported by
our largest creditors, provides the best outcome for Noble and our
stakeholders. Our improved balance sheet and liquidity position
will enable us to further invest in our assets, customer
relationships and our people. I would like to personally thank our
employees for their continued dedication, as well as all of our
customers and service providers for their support and partnership.
We remain committed to the world class operational excellence,
safety and environmental stewardship that defines Noble."
Additional information regarding the Chapter 11 Cases will be
available at www.noblecorp.com/restructuring. Court filings and
other information related to the court-supervised proceedings are
available at a website administered by the Company's claims agent,
EPIQ Restructuring Services, LLC, at https://dm.epiq11.com/noble.
Questions should be directed to our dedicated restructuring hotline
by phone at 855-917-3560 (toll free in the U.S.) or 503-597-7713
(for international callers), or by e-mail at
NobleInfo@epiqglobal.com.
Skadden, Arps, Slate, Meagher & Flom LLP is serving as legal
counsel to Noble, Evercore is serving as the Company's financial
advisor, and AlixPartners LLP is serving as operational advisor.
Porter Hedges LLP is serving as local legal counsel and EPIQ
Restructuring Services LLC is serving as administrative agent.
Kramer Levin Naftalis & Frankel LLP and Akin Gump LLP are serving
as co-legal counsel and Ducera Partners LLC is serving as financial
advisor to an ad hoc group of the Company's priority guaranteed
noteholders.
Milbank LLP is serving as legal counsel and Houlihan Lokey Capital,
Inc. is serving as financial advisor to an ad hoc group of the
Company's senior noteholders.
Simpson Thacher & Bartlett LLP is serving as legal counsel and PJT
Partners is serving as financial advisor to JP Morgan.
About Noble Corporation plc
Noble (NYSE: NE) -- http://www.noblecorp.com-- is an offshore
drilling contractor for the oil and gas industry. The Company owns
and operates one of the most modern, versatile and technically
advanced fleets in the offshore drilling industry. Noble performs,
through its subsidiaries, contract drilling services with a fleet
of 24 offshore drilling units, consisting of 12 drillships and
semisubmersibles and 12 jackups, focused largely on ultra-
deepwater and high-specification jackup drilling opportunities in
both established and emerging regions worldwide. Noble is a public
limited company registered in England and Wales with company number
08354954 and registered office at 10 Brook Street, London, W1S 1BG
England.
*********
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