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       T R O U B L E D   C O M P A N Y   R E P O R T E R

                          E U R O P E

          Thursday, October 28, 2021, Vol. 22, No. 210

                           Headlines



F I N L A N D

AHLSTROM-MUNKSJO HOLDING: S&P Affirms 'B' LT ICR, Outlook Stable


F R A N C E

VALEO: Egan-Jones Lowers Sr. Unsecured Debt Ratings to BB-


G E O R G I A

TBC BANK: Fitch Rates Upcoming Perpetual AT1 Notes 'B-(EXP)'


G E R M A N Y

EUROPEAN MEDCO 3: Fitch Affirms 'B' LongTerm IDR, Outlook Stable
HUGO BOSS: Egan-Jones Keeps BB- Senior Unsecured Ratings


L U X E M B O U R G

EP BCO SA: Moody's Lowers CFR to B1, Outlook Negative


N E T H E R L A N D S

KONINKLIJKE KPN: Egan-Jones Keeps BB Senior Unsecured Ratings


S P A I N

REPSOL SA: Egan-Jones Keeps BB- Senior Unsecured Ratings
TELEFONICA SA: Egan-Jones Retains BB- Senior Unsecured Ratings


S W I T Z E R L A N D

VIKING CRUISES: $100MM Notes Add-on No Impact on Moody's B3 CFR


U N I T E D   K I N G D O M

CARILLION PLC: FCA Can Investigate Financial Statements
CASTLEOAK: Was Taking on New Employees Days Prior to Collapse
GREAT HALL 2006-01: Moody's Affirms Ba1 Rating on Class Ea Notes
HAMPSON HUGHES: Sold to Recovery First Following Administration
INTU: Council Misses Out on Cash to Demolish Broadmarsh Centre

NMCN: Government Takes on GBP75MM Sewage Treatment Project
SHERWOOD PARENTCO: Fitch Assigns 'BB-' LT IDR, Outlook Stable
SHERWOOD PARENTCO: Moody's Assigns B1 CFR & Rates Secured Notes B1
SHERWOOD PARENTCO: S&P Assigns Prelim 'B+' ICR, Outlook Stable
SIG PLC: Egan-Jones Retains B+ Senior Unsecured Ratings

TESCO PLC: Egan-Jones Keeps BB+ Senior Unsecured Ratings

                           - - - - -


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F I N L A N D
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AHLSTROM-MUNKSJO HOLDING: S&P Affirms 'B' LT ICR, Outlook Stable
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S&P Global Ratings affirmed its long-term 'B' issuer credit rating
on Finnish fiber-based materials producer Ahlstrom-Munksjo Holding
3 Oy (Ahlstrom-Munksjo), and its 'B' issue rating on the term loan
B and senior secured notes due 2028. S&P lowered the recovery
rating on the senior secured facilities from '3' to '4' because of
the increase in first-lien debt.

S&P also assigned a 'B' issue and '4' recovery rating to the
proposed EUR282 million term loan due 2028.

S&P said, "We believe that the increase in debt leverage will be
partially mitigated by the strong operating performance forecast in
2021-2022. The higher debt is mainly a result of the proposed
EUR282 million term loan, but also EUR153 million debt at local
subsidiaries (which were not repaid as a part of the change in
ownership), about EUR60 million of incremental factoring
utilization, and additional debt to partially fund the acquisition
of Minglian New Materials Technology Co. Ltd. in fourth-quarter
2021. In our view, the debt increase is partially offset by a
strong recovery in forecast sales for 2021-2022, since activity
picked up across most business areas once pandemic-related
restrictions were eased. An upsurge in sales volumes, a more
favorable product mix (underpinned by an increase in sales in
businesses such as filtration, glass fiber tissue, nonwoven and
liquid technologies), and cost efficiencies will only be partly
offset by input costs inflation in 2021. We estimate that this will
result in S&P Global Ratings-adjusted EBITDA of EUR345
million–EUR355 million (compared with EUR324 million in 2020).

"We now forecast minimal adjusted free operating cash flow (FOCF)
generation in 2021. We expect FOCF of about EUR5 million–EUR10
million in 2021, after factoring adjustments. FOCF generation will
be undermined by an estimated increase of EUR25 million in capital
expenditure (capex) for new and ongoing projects, and
transformation and restructuring costs of about EUR45 million in
2021. Our forecast also reflects an increase of about EUR60 million
in factoring utilization. In 2022, we expect a recovery in line
with our previous estimate (toward EUR100 million-EUR120 million)
on the back of stronger EBITDA generation, as efficiency gains ramp
up and transformation costs moderate.

"In our view, Ahlstrom-Munksjo's credit metrics remain commensurate
with a 'B' rating despite the increase in debt. We believe that
leverage will approach 8.0x by year-end 2021, and forecast that it
will improve toward 7.0x in 2022. We expect that FFO to debt will
drop below 9% in 2021 and improve toward 10% in 2022. We consider
that Ahlstrom-Munksjo's credit ratios remain in line with other 'B'
rated peers, albeit with reduced ratings headroom.

"In our opinion, the debt-funded squeeze-out of minorities is an
aggressive transaction. That said, we believe it is in line with
our current financial policy score (FS-6) on the company, which
reflects potentially aggressive financial strategies given its
financial sponsor ownership. We could revise that score downward if
the company's financial policy increased aggressiveness via, for
example, large debt-funded acquisitions or dividend payments.

"We believe that the acquisition of Minglian is a step forward in
the potential divestment of the Decor business. Partnering with a
local company will allow Ahlstrom-Munksjo to strengthen its
positioning in the Chinese market where strong competition, mainly
from national producers, has eroded profitability in recent years.
We understand that the acquisition, which we expect to complete
before end-2021, will be partly financed using available debt
facilities. This should result in only a temporary debt increase,
in our view, especially as we also understand that Ahlstrom-Munksjo
continues to evaluate additional strategic alternatives for the
Decor business, such as a partial or full divestment.

"The stable outlook reflects our expectation that Ahlstrom-Munksjo
will continue to record strong underlying performance. We forecast
debt to EBITDA of about 8.0x and FFO to debt of about 8.5% over the
next 12 months."

S&P could lower its ratings if:

--Ahlstrom-Munksjo failed to reduce its leverage;

-- FOCF was negative on a sustained basis; or

-- The company's financial policy became more aggressive via, for
example, a large debt-funded acquisition or dividend payment.

S&P could raise the ratings if:

-- Adjusted debt to EBITDA declined toward 5.0x on a sustained
basis; and

-- The group's financial policy supported these credit metrics.




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F R A N C E
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VALEO: Egan-Jones Lowers Sr. Unsecured Debt Ratings to BB-
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Egan-Jones Ratings Company, on October 14, 2021, downgraded the
foreign currency and local currency senior unsecured ratings on
debt issued by Valeo to BB- from B+.

Headquartered in Paris, France, Valeo designs and manufactures
automobile components.




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G E O R G I A
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TBC BANK: Fitch Rates Upcoming Perpetual AT1 Notes 'B-(EXP)'
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Fitch Ratings has assigned JSC TBC Bank's upcoming issue of US
dollar-denominated perpetual additional Tier 1 (AT1) notes an
expected long-term rating of 'B-(EXP)'. The expected amount of the
issue is USD100 million. The notes will rank pari passu among
themselves and the existing AT1 subordinated obligations of the
bank. The final rating is contingent upon the receipt of final
documents conforming to information already received.

KEY RATING DRIVERS

The notes are rated three notches below TBC's Viability Rating (VR)
of 'bb-'. According to Fitch's Bank Rating Criteria, this is the
highest rating that can be assigned to deeply subordinated notes
with fully discretionary coupon omission issued by banks with a VR
anchor of 'bb-'. The notching reflects the notes' higher loss
severity in light of their deep subordination and additional
non-performance risk relative to the VR given a high write-down
trigger and fully discretionary coupons.

The notes are perpetual, deeply subordinated, fixed-rate resettable
AT1 debt securities, which are expected to qualify as regulatory
AT1 capital. The notes have a full coupon omission option at the
bank's discretion and full or partial write-down triggers if either
(i) the bank's common equity Tier 1 (CET1) capital adequacy ratio
(CAR) falls below 5.125% (versus a 4.5% Pillar 1 regulatory
minimum); or (ii) as defined by the National Bank of Georgia (NBG),
the bank becomes non-viable and requires extraordinary capital
support, or receives a public-sector injection of capital or
equivalent extraordinary support.

According to current banking regulation, the trigger for coupon
restrictions is a failure to meet Pillar 1, Pillar 2 plus the
combined buffer requirements (the sum of the conservation buffer,
counter-cyclical buffer and systemic risk buffer) or leverage ratio
requirement. These requirements were 11.2% for CET1, 13.5% for Tier
1 and 17.8% for total CAR and 5% for the leverage ratio at
end-1H21.

The risk of coupon restrictions is reasonably mitigated by TBC's
stable financial profile, healthy profitability, and reasonable
headroom over capital minimums, including buffers. At end-1H21,
TBC's capital ratios were 13.0% for CET1, 15.5% for Tier 1 and
19.6% for total CAR, with the headroom above the requirements the
lowest for the total CAR of 173bp. The leverage ratio was 12.3% at
the same date.

The notes will have no established redemption date. However, TBC
has an option to repay the notes in three months prior the first
coupon reset date (in 2027) and on every subsequent interest
payment date, subject to NBG approval.

RATING SENSITIVITIES

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

-- Upside for the notes is limited as per Fitch's criteria the
    minimum notching of deeply subordinated instruments will
    increase up to four notches, should the VR be upgraded to 'bb'
    from 'bb-'.

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

-- The issue rating could be downgraded if TBC's VR is
    downgraded.

-- The issue ratings could also be downgraded if Fitch takes the
    view that non-performance risk has increased and widens the
    notching between TBC's VR and the issue's ratings. This could
    arise if the bank fails to maintain reasonable headroom over
    the minimum CARs (including buffers) or if the instrument
    becomes non-performing, i.e. if the bank cancels any coupon
    payment or at least partially writes off the principal. In
    that case, the AT1's rating will be downgraded based on
    Fitch's expectations about the form and duration of non
    performance.

BEST/WORST CASE RATING SCENARIO

International scale credit ratings of Financial Institutions and
Covered Bond 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.

ESG CONSIDERATIONS

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




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G E R M A N Y
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EUROPEAN MEDCO 3: Fitch Affirms 'B' LongTerm IDR, Outlook Stable
----------------------------------------------------------------
Fitch Ratings has affirmed the Long-Term Issuer Default Rating
(IDR) of European Medco Development 3 S.a.r.l. (EMD 3) at 'B' with
a Stable Outlook on announcement of the agreement to acquire
Novasep, a contract manufacturer of active pharmaceutical
ingredients (APIs). Fitch has also affirmed the rating of the
senior secured debt issued by European Medco Development 4 S.a.r.l.
at 'B+' with a Recovery Rating of 'RR3' ahead of the planned term
loan B (TLB) increase of EUR215 million to EUR520 million.

EMD 3 indirectly owns PharmaZell, the Germany-based manufacturer of
APIs. The 'B' IDR reflects PharmaZell's contract development and
manufacturing organisation (CDMO) business risk profile, the
operations of which will markedly grow following the merger with
Novasep, benefitting from improved diversification, although
remaining mid-scale for the sector, with some product
concentrations and limited scalability given its asset- and
capital-intensive nature. This is mitigated by well-entrenched
market positions in specialty API, long-standing customer
relationships and the expectation that, post-merger, Pharmazell
will maintain an adequate financial risk profile.

The Stable Outlook encapsulates Fitch's expectations of strong
organic growth and low integration risk in relation to Novasep,
with sustained positive free cash flow (FCF) and organic
deleveraging prospects towards 5.0x on a funds from operations
(FFO) gross leverage basis by the financial year to March 2025
(FY25), from Fitch's expected pro forma post-merger starting
leverage of 6.2x in FY22.

KEY RATING DRIVERS

Accretive Transformational Acquisition: Following the merger,
PharmaZell will double its revenue and EBITDA while achieving
greater diversification across its value offering from generic to
innovative pharma, product and therapeutic areas, in addition to
proprietary manufacturing technologies, with new API groups
benefitting from large addressable markets and a more balanced
regional footprint. The combined API platform will raise
PharmaZell's profile as a complex API manufacturer supporting its
sole or preferred supplier status with generic and innovative
pharma companies.

Conservative Acquisition Funding: The ratings affirmation is
materially driven by the conservative acquisition funding of
Novasep with nearly 80% of the enterprise value coming from equity
or equity-like sources, such as around EUR500 million of new equity
to be provided by the sponsor and EUR111 million of the
payment-in-kind (PIK) facility in combination with EUR215 million
of incremental TLB.

PIK Facility Treated as Equity: As per Fitch's criteria, Fitch
treats the PIK facility as equity-like and consequently exclude it
from Fitch's calculation of financial leverage and debt service
coverage metrics. The PIK facility will be increased on the basis
of the existing agreement and will be down-streamed into the rated
perimeter by way of shareholder loans. The equity-like treatment is
supported by the facility being PIK-for-life with the absence of
scheduled cash interest payments. Cash interest payments are only
optional and solely at the discretion of the PIK facility borrower,
minimising the risk of payment default as long as senior secured
debt remains outstanding.

Improving Deleveraging Capacity: The acquisition will improve
PharmaZell's deleveraging capacity given the doubled revenue and
EBITDA post-transaction in combination with a high share of equity
or equity-like funding. After an initial post-merger FFO leverage
of around 9.0x in FY22 based on a pro rata contribution from
Novasep of four months in FY22 and estimated at 6.2x on a pro forma
basis, Fitch projects deleveraging to 5.0x by FY24, with the
prospect of further deleveraging to less than 5.0x by FY25. Fitch
views this leverage profile as appropriate for the rating. However,
Fitch sees medium-term risk of further debt-funded M&A, which may
disrupt the deleveraging path.

Limited Integration, Moderate Execution Risk: Fitch considers both
companies' strategies to have moderate risk as they are based on
organic business expansion around an existing portfolio of
molecules, with low integration risks in the absence of deeply
intertwined manufacturing or commercial processes between the two
entities, and modest near-term synergies limited to central
corporate office functions and an IT platform. These manageable
integration and medium-term strategy execution risks are reflected
in the Stable Outlook.

Asset-Intensive Operations, Limited Scalability: As a supplier of
specialty API to generic drug manufacturers, PharmaZell's business
model reflects the traits of a CDMO with high capital intensity and
limited operational scalability, albeit benefitting from
proprietary production technologies, which will be further
reinforced with the acquisition of Novasep.

Fitch estimates the post-merger EBITDA margins will be lower than
PharmaZell's stand-alone profitability yet healthy for the sector,
projected to reach 24% by FY25 from 23% initially, as Novasep
benefits from higher capacity utilisation levels, while
PharmaZell's operating profitability is forecast to remain strong
and stable at around 30%. Execution of organic expansion and
de-bottlenecking projects after the merger will lead to high
ongoing capital intensity that Fitch estimates at an average of 10%
in the next four years. High capital intensity is critical to
PharmaZell's sustained growth and productivity.

Self-Funded Capex: Fitch projects that, post-merger, PharmaZell
will continue to be able to fund its extensive capex programme
entirely from internal cash flow, which supports its 'B' IDR and
differentiates it from lower-rated sector credits. An inability to
adequately invest in its manufacturing base could undermine the
company's cost competitiveness and organic growth prospects, which
are instrumental to achieving sustained positive FCF and
deleveraging.

Supportive Market Fundamentals: PharmaZell's credit profile
benefits from a supportive sector environment in the broader
pharmaceuticals market due to a growing and ageing population and
increasing access to medical care, with generic drugs receiving
government support as a means of containing rising healthcare
costs.

The merger with Novasep will further reinforce PharmaZell's ability
to capitalise on supportive sector trends around the outsourcing of
manufacturing processes, amid the growing complexity of drug
molecules with increasing speed to market, by extending its
offering to innovative and biotech companies with large and growing
addressable indication markets, particularly oncology.

DERIVATION SUMMARY

Fitch rates PharmaZell according to its Rating Navigator Framework
for Pharmaceutical Companies. Fitch regards the capital-intensive
CDMO Roar Bidco AB (Recipharm; B/Positive) as the closest peer to
PharmaZell, whose business model benefits from outsourcing trends
in the pharmaceutical industry and high barriers to entry leading
to overall stable through-the-cycle underlying business dynamics.
Both ratings are constrained by high FFO gross leverage of 7.0x or
higher and rely on an inherent deleveraging capacity backed by
growing EBITDA and cash flow.

At the same time, Fitch views Recipharm's business model as
stronger given the company's larger scale (with its estimated
number four position in the global CDMO market), exposure to
technologically advanced drug delivery technologies, high revenue
visibility and more sizeable FCF with a comfortable liquidity
position. Based on its stronger operating profile, Recipharm can
therefore tolerate up to 1.0x higher leverage for a 'B' credit. The
difference between Recipharm's Positive Outlook and PharmaZell's
Stable Outlook is due to the former's deleveraging prospects to
below 6.5x by end-2022 in combination with a more resilient
business risk profile.

Fitch also compares PharmaZell with animal pharma manufacturer
Financiere Top Mendel S.A.S. (Ceva Sante; B/Stable), whose ability
to maintain market share and profitability strongly relies on
ongoing large investments and R&D capabilities. Similarly to
Recipharm's, Ceva Sante's considerably larger business scale,
healthy operating margins and ample liquidity headroom allow a
higher FFO gross leverage tolerance of at least 1.0x more than
PharmaZell's for a 'B' IDR.

In contrast, asset-light pharmaceutical companies such as IWH UK
Finco Limited (Theramex; B/Stable), Cheplapharm Arzneimittel GmbH
(B+/Stable) and Pharmanovia Bidco Limited (Atnahs; B+/Negative)
reflect different operating risks with an emphasis on drug IP
rights management, or marketing and distribution capabilities and
far less ongoing capex requirements leading to stronger FCF margins
than PharmaZell's. While all three companies have some product
concentrations, higher-rated Cheplapharm and Atnahs show
considerably stronger FCF and more conservative financial policies
than Theramex.

KEY ASSUMPTIONS

Fitch's key assumptions within rating case for the issuer include:

-- Sales growth, post-merger, growing towards EUR560 million in
    FY25 (5.3% CAGR);

-- Pro forma EBITDA margin of 23% in FY22, gradually improving
    towards 24% in FY25;

-- Capex at 12%-14% of sales driven by investments in production
    expansion;

-- Working capital outflows of around EUR4 million-10 million a
    year;

-- Funding of the acquisition of Novasep via the issuance of the
    incremental TLB of EUR215 million in combination with new
    equity of around EUR500 million assumed to be provided by the
    sponsor and EUR111 million to be issued under the PIK
    facility, both of which Fitch treats as equity in accordance
    with Fitch's criteria;

-- No significant M&A;

-- No shareholder distributions.

Recovery Ratings Assumptions

Our recovery analysis assumes that PharmaZell would be restructured
as a going concern rather than liquidated in a default.

Given some product and customer concentration risks, EBITDA
contraction at the point of distress could be significant. Fitch
estimates post-distress EBITDA of EUR45 million. Earnings
contraction of that magnitude would most likely be the result of a
significant sales decline of one of PharmaZell's products in the
concentrated portfolio (e.g. top three steroids contribute an
estimated 15% of sales; 5-ASA product comprises around 20% of
sales) as a result of severe manufacturing disruption, regulatory
issues, market-share loss to a superior competitive product or
unsuccessful drug commercialisation by one of PharmaZell's
customers.

PharmaZell has developed substantial technical knowledge and
proprietary technologies over the past 20 years or more. It also
has an inelastic (more than 15 years) blue-chip customer base.
These are factored into the distressed valuation as are the
attractive pharma market fundamentals that support overall growth
of 6%-8% in core product lines (steroids, 5-ASA and amino acids).

In Fitch's recovery analysis, Fitch estimates that around EUR20
million of asset-backed financing comprising receivables factoring
facilities of approximately EUR15 million, together with export
advance financing facilities of some EUR5 million, will not be
available to the business post-distress.

Fitch applies an enterprise value (EV)/EBITDA distressed multiple
of 5.5x to reflecting PharmaZell's value of its proprietary
technologies and established customer relationships.

After deducting 10% for administrative claims, Fitch's principal
waterfall analysis generated a ranked recovery in the 'RR3' band
for the all senior secured capital structure, comprising the TLB of
EUR305 million and an EUR75 million revolving credit facility
(RCF), which Fitch assumes to be fully drawn prior to distress, and
ranking equally among themselves.

This indicates a 'B+'/'RR3' instrument rating for the senior
secured debt with an output percentage based on current metrics and
assumptions at 53%. On completion of the acquisition of Novasep,
Fitch expects an output percentage of 57% for the enlarged senior
secured debt leading to an unchanged 'B+'/'RR3' instrument rating.

RATING SENSITIVITIES

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

-- Increasing business scale and product diversification
    supporting EBITDA margin expansion towards 35% (above 25% on
    completion of the merger);

-- FCF margins sustained at high single digits; and

-- FFO gross leverage sustained below 5.0x.

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

-- Declining revenue due to product or production issues or as a
    result of customer losses leading to the EBITDA margin
    declining towards 25% (or integration issues leading to the
    EBITDA margin declining towards 20% on completion of the
    merger);

-- Weak-to-neutral FCF on a sustained basis;

-- FFO gross leverage above 7.0x; and

-- FFO interest coverage below 2.5x.

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

Satisfactory Liquidity: Fitch projects satisfactory liquidity with
increased post-merger cash from operations of EUR70 million-90
million, which will be sufficient to self-fund annual capex
estimated at EUR50 million-60 million including integration-related
cash outlays. After deducting EUR10 million deemed as restricted
cash to support intra-year trade working capital, Fitch estimates a
sufficient year-end cash balance of around EUR30 million in FY22,
gradually improving to EUR40 million by FY24, in addition to the
committed RCF of EUR75 million, which Fitch expects will remain
fully undrawn.

PharmaZell has a concentrated debt structure with a TLB due in
2027, which translates into manageable refinancing risk given
long-dated debt maturities, underlying positive FCF and supportive
industry dynamics.

ISSUER PROFILE

PharmaZell is a manufacturer of APIs for the generics drug market.
The company is focused on off-patent niche specialty APIs requiring
complex manufacturing processes and proprietary technologies.

The acquisition target, Novasep, focuses on APIs for innovative
pharma and biotech companies.


HUGO BOSS: Egan-Jones Keeps BB- Senior Unsecured Ratings
--------------------------------------------------------
Egan-Jones Ratings Company, on October 11, 2021, maintained its
'BB-' foreign currency and local currency senior unsecured ratings
on debt issued by Hugo Boss AG.

Headquartered in Metzingen, Germany, Hugo Boss AG designs,
produces, and markets brand name clothing.




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L U X E M B O U R G
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EP BCO SA: Moody's Lowers CFR to B1, Outlook Negative
-----------------------------------------------------
Moody's Investors Service has downgraded the Corporate Family
Rating and Probability of Default Rating of EP BCo SA ("Euroports"
or "the company") to B1 from Ba3 and to B1-PD from Ba3-PD
respectively.

In addition, Moody's has downgraded the ratings of Euroports'
EUR365 million senior secured first lien term loan B and EUR45
million revolving credit facility to Ba3 from Ba2; and the rating
of the EUR105 million senior secured second lien term loan to B3
from B2. The outlook is negative.

RATINGS RATIONALE

The downgrade of the CFR to B1 from Ba3 reflects Euroports'
continued high leverage and failure to deliver improvements to its
Funds From Operations (FFO) generation such that the FFO/Debt
metric would likely reach the level commensurate with a Ba3 rating,
namely FFO/Debt of at least at 10% on a sustainable basis. In 2020
Euroports reported an FFO/Debt ratio of around 8% and Moody's
expects that ratio will remain below 10% over at least the next
12-18 months. Euroports operating performance proved
relativelyresilient in 2020 and is improving in 2021 on the back of
a recovery from the Covid-19 crisis. Credit metrics will be
negatively impacted by a Q1 2021 debt-funded acquisition of a 50%
stake in the tank park GOR which resulted in a moderate increase to
Euroports' debt, albeit with an increase in consolidated EBITDA.

The maintenance of the negative outlook takes into account
uncertainties regarding the company's financial profile created by
audited consolidated financial statements not prepared fully in
accordance with International Financial Reporting Standards (IFRS)
because they exclude the impact of IFRS16. While the exclusion is
in compliance with lenders requirements and mandatory reporting
obligations, it continues to challenge financial analysis and is
considered by Moody's as a governance factor. A failure to procure
such a report for the financial year ending 31 December 2021 could
result in a further downgrade of the rating.

The B1 CFR positively reflects (1) the resilience of Euroports'
operating performance amid the Covid-19 crisis supported by
effective cost savings program and robust activity in the terminals
of Rostock and Changshu and the logistic business of MPL (if
excluding the impact of non-operating/recurring items), (2) the
strategic location of Euroports' key terminals which are close to
key trade routes, clients and well connected with their respective
hinterland, (3) the high degree of geographic and industry
diversification, through strong terminal presence in Northern and
Southern Europe and in China, and (4) long standing relationships
with a well-diversified group of large industrial customers and
contractual take or pay or volume requirement features which
somewhat offset the volatility of underlying commodities handled.

At the same time Euroports' B1 CFR is constrained by (1) the
concentration of Euroports' operating cash flows on the forest
products and sugar industries which together represent nearly 40%
of the company's reported EBITDA, and exposure to economic cycles,
negative sector trends or adverse weather conditions,
notwithstanding contractual arrangements with key customers, (2) a
de-leveraging path which will essentially rely on EBITDA growth in
the absence of debt amortization, and (3) financial reporting
arrangements that are focused predominantly on the requirements set
out in the company's loan agreements.

Europort has demonstrated a relatively resilient operating
performance amid the Covid-19 crisis. During the most impacted year
of 2020 its revenues dropped by 4% to EUR589 million and while
reported EBITDA fell by 11% to EUR55 million the deterioration was
mostly caused by costs identified by management as non-recurring by
nature such as restructuring and reorganization costs which
together amounted to over EUR13 million. The relative resilience in
performance was led by a good level of activity at the terminals of
Changshu in China (+10% year on year revenue growth) and to a
lesser extent at Rostock in Germany and at the logistic business
MPL, as well as large costs savings mainly at the Finland and
Belgium terminals.

With the increase in consumer demand driven by the reopening of
economies on the back of Covid-19 recovery, operating performance
has demonstrated a more robust improvement in H1 2021 with revenues
and OEBITDA jumping by 20% and 27% respectively vs. 2020. While
Moody's expects the growth pattern to continue for the remainder of
the year driven by trade activity at Rostock terminal (also boosted
by the impact of the acquisition of the GOR tank park in the
beginning of the year) and at MPL, the agency anticipates growth
will be more moderate beyond 2021 also as the impact of cost
cutting diminishes.

Moody's considers Euroports' liquidity profile as adequate. As of
December 31, 2020, Euroports had EUR72 million in available cash.
The company does not face any material debt maturity until 2026
when the EUR355 million senior secured first lien term loan is due.
Given Euroports' relatively low maintenance capital expenditure
requirements Moody's anticipates that the company will generate a
broadly neutral to positive free cash flow in the next 12 to 18
months. After repaying EUR9 million drawn under the RCF as part of
the GOR acquisition transaction earlier this year the company has
access to an undrawn EUR36 million out of which EUR27 million is
restricted by a springing leverage-based financial covenant with a
testing Net Debt/EBITDA ratio of 5.40x in June 2021 which ratchets
down to 4.50x from June 2022.

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

Given the negative outlook a rating upgrade is unlikely in the near
term. The outlook could move to stable should Euroports provide
audited consolidated financial statements in compliance with IFRS
standards while maintaining credit metrics commensurate with a B1
rating, i.e with FFO/Debt of at least 8% on a sustainable basis.

Conversely, a downgrade of the assigned ratings could result from
the absence of material improvements in Euroports' operating
performance such that FFO to Debt was likely to be below 8% on a
sustainable basis. A more aggressive stance than expected on
financial policy or a marked deterioration in Euroports liquidity
profile could also exert negative pressure on the ratings.

PRINCIPAL METHODOLOGY

The principal methodology used in these ratings was Privately
Managed Ports Methodology published in May 2021.

COMPANY PROFILE

EP BCo SA is the direct shareholder of Euroports Holdings S.a.r.l,
an international port operator whose operations consist of
large-scale ports which are situated in fifteen main terminal areas
in Northern and Southern Europe as well as in China. Through its
terminals the company handles, stores and transports primarily bulk
and breakbulk products for a diverse customer base across seven end
markets : Paper & Pulp, Sugar, Metals & Steel, Fertilizer &
Minerals, Agribulk, Coal and Fresh and Frozen products. In 2020 EP
BCo SA reported EUR589 million in revenues and EUR55 million in
EBITDA (including non-operating items).




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

KONINKLIJKE KPN: Egan-Jones Keeps BB Senior Unsecured Ratings
-------------------------------------------------------------
Egan-Jones Ratings Company, on October 11, 2021, maintained its
'BB' foreign currency and local currency senior unsecured ratings
on debt issued by Koninklijke KPN N.V.

Headquartered in Rotterdam, Netherlands, Koninklijke KPN N.V. is a
telecommunications and IT provider in the Netherlands, serving both
consumer and business customers with its fixed and mobile networks
for telephony, broadband and television.




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

REPSOL SA: Egan-Jones Keeps BB- Senior Unsecured Ratings
--------------------------------------------------------
Egan-Jones Ratings Company, on October 11, 2021, maintained its
'BB-' foreign currency and local currency senior unsecured ratings
on debt issued by Repsol S.A.

Headquartered in Madrid, Spain, Repsol S.A., through subsidiaries,
explores for and produces crude oil and natural gas, refines
petroleum, and transports petroleum products and liquefied
petroleum gas (LPG).


TELEFONICA SA: Egan-Jones Retains BB- Senior Unsecured Ratings
--------------------------------------------------------------
Egan-Jones Ratings Company, on October 11, 2021, maintained its
'BB-' foreign currency and local currency senior unsecured ratings
on debt issued by Telefonica SA.

Headquartered in Madrid, Spain, Telefonica SA operates as a
telecommunications company.




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

VIKING CRUISES: $100MM Notes Add-on No Impact on Moody's B3 CFR
---------------------------------------------------------------
Moody's Investors Service stated that Viking Cruises Ltd's
("Viking"; B3 negative) $100 million add-on to its existing 7%
senior unsecured notes due 2029 has no impact on its ratings
including its B3 corporate family rating and B3-PD probability of
default rating. The outlook remains negative. Proceeds from the
add-on will be used for general corporate purposes. At the same
time as the offering, Viking is seeking to amend the terms of
previously issued notes to, among other things, allow for
indebtedness related to the Mississippi River sailing operations.
The additional debt is modestly credit negative, but is offset by
the benefit of incremental liquidity at a time when the company is
restarting operations.

Viking relaunched operations over the summer with more than half of
its river fleet and all six of its ocean ships back on the water at
its peak after about 15 months of suspended operations. Moody's
expects that as the impact of the Delta variant diminishes, and
vaccination rates increase around the world, Viking should have
most of its fleet up and running in time for the all-important
summer sailing season in 2022. Assuming another variant does not
arise with the same, or worse, impact as the Delta variant, Viking
should be on a trajectory to achieve at least 50% of its 2019
EBITDA in 2022 -- a key driver of its B3 corporate family rating.
The negative outlook continues to reflect the risk that COVID flare
ups in certain regions this winter could impact bookings and
potentially cause occupancy rates to remain restricted into 2022.
Viking's debt/EBITDA will remain high for at least the next two
years. Importantly, the company's liquidity remains good with about
$1.9 billion of cash at the end of September, pro forma for the
planned add-on and including $500 million of equity held at
Viking's parent. This amount of liquidity is sufficient to cover
required cash usage and increased operating expenses expected over
the next two quarters as the company readies its fleet for a full
return to operations.

Based in Basel, Switzerland, Viking is a cruise line offering Ocean
and River cruises. The company will also operate Expedition and
Mississippi River cruises in 2022. At December 31, 2019 Viking
operated a fleet of 72 river cruise vessels and six ocean cruise
ships. Its river cruises operate in over 30 countries largely in
Continental Europe. Historically, about 85% of its total river and
ocean customers are sourced from North America. TPG Capital and
Canada Pension Plan Investment Board own a minority interest
(slightly more than 40% on a combined basis) in Viking Holdings
Ltd, parent company of Viking Cruises. The remaining ownership is
indirectly held under a trust in which Torstein Hagen has a life
interest. Net revenues were about $2.1 billion for the fiscal year
2019.




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

CARILLION PLC: FCA Can Investigate Financial Statements
-------------------------------------------------------
Joanne Faulkner at Law360 reports that the City watchdog does not
need court permission to probe the financial statements of
collapsed outsourcing giant Carillion, a judge said on Oct. 27,
after the company tried to halt an investigation into it using
insolvency rules.

According to Law360, the Financial Conduct Authority successfully
appealed an Insolvency and Companies Court decision that the
watchdog cannot start regulatory action against Carillion PLC
without approval from the court.


CASTLEOAK: Was Taking on New Employees Days Prior to Collapse
-------------------------------------------------------------
Grant Prior at Construction Enquirer reports that collapsed
retirement and care homes builder Castleoak was taking on new
employees just seven days before bosses filed for administration.

Stunned staff were given the bad news on Oct. 25 with more than 100
people losing their jobs, Construction Enquirer relates.

Castleoak was a Cardiff based developer with its own design and
build division and offsite manufacturing facility.

Latest accounts filed at Companies House for Castleoak Holdings Ltd
show that in the year to March 31, 2019, the group made a pre-tax
profit of GBP496,527 from a turnover of GBP67.2 million and
employed 152 staff, Construction Enquirer discloses.


GREAT HALL 2006-01: Moody's Affirms Ba1 Rating on Class Ea Notes
----------------------------------------------------------------
Moody's Investors Service has upgraded the ratings of 9 notes
issued by Great Hall Mortgages No. 1 Plc Series 2006-01, Great Hall
Mortgages No. 1 Plc Series 2007-01 and Great Hall Mortgages No. 1
Plc Series 2007-02. The rating action reflects better than expected
collateral performance and the increased levels of credit
enhancement for the affected notes.

Moody's affirmed the ratings of the notes that had sufficient
credit enhancement to maintain the current rating on the affected
notes.

The transactions are static cash securitisations of legacy
non-conforming mortgage loans secured on residential properties
located in the UK.

LIST OF AFFECTED RATINGS

Issuer: Great Hall Mortgages No. 1 Plc Series 2006-01

GBP216.3M Class A2a Notes, Affirmed Aa3 (sf); previously on Apr
21, 2015 Affirmed Aa3 (sf)

EUR175M Class A2b Notes, Affirmed Aa3 (sf); previously on Apr 21,
2015 Affirmed Aa3 (sf)

GBP25.8M Class Ba Notes, Affirmed Aa3 (sf); previously on Apr 21,
2015 Affirmed Aa3 (sf)

EUR7.5M Class Bb Notes, Affirmed Aa3 (sf); previously on Apr 21,
2015 Affirmed Aa3 (sf)

GBP11.5M Class Ca Notes, Affirmed Aa3 (sf); previously on Jul 23,
2015 Upgraded to Aa3 (sf)

EUR8M Class Cb Notes, Affirmed Aa3 (sf); previously on Jul 23,
2015 Upgraded to Aa3 (sf)

GBP6M Class Da Notes, Upgraded to Aa3 (sf); previously on Jul 23,
2015 Upgraded to A2 (sf)

EUR11.5M Class Db Notes, Upgraded to Aa3 (sf); previously on Jul
23, 2015 Upgraded to A2 (sf)

GBP5.6M Class Ea Notes, Affirmed Ba1 (sf); previously on Jul 23,
2015 Upgraded to Ba1 (sf)

Issuer: Great Hall Mortgages No. 1 Plc Series 2007-01

GBP264M Class A2a Notes, Affirmed Aa3 (sf); previously on Apr 21,
2015 Affirmed Aa3 (sf)

EUR396M Class A2b Notes, Affirmed Aa3 (sf); previously on Apr 21,
2015 Affirmed Aa3 (sf)

GBP47.1M Class Ba Notes, Affirmed Aa3 (sf); previously on Apr 21,
2015 Affirmed Aa3 (sf)

EUR55.6M Class Bb Notes, Affirmed Aa3 (sf); previously on Apr 21,
2015 Affirmed Aa3 (sf)

GBP14M Class Ca Notes, Affirmed Aa3 (sf); previously on Jul 23,
2015 Upgraded to Aa3 (sf)

EUR33.4M Class Cb Notes, Affirmed Aa3 (sf); previously on Jul 23,
2015 Upgraded to Aa3 (sf)

GBP19M Class Da Notes, Upgraded to A1 (sf); previously on Jul 23,
2015 Upgraded to Baa2 (sf)

EUR22.9M Class Db Notes, Upgraded to A1 (sf); previously on Jul
23, 2015 Upgraded to Baa2 (sf)

GBP14.5M Class Ea Notes, Upgraded to B1 (sf); previously on Apr
21, 2015 Upgraded to B3 (sf)

Issuer: Great Hall Mortgages No. 1 Plc Series 2007-02

GBP278.8M Class Aa Notes, Affirmed Aa3 (sf); previously on Apr 21,
2015 Affirmed Aa3 (sf)

EUR30M Class Ab Notes, Affirmed Aa3 (sf); previously on Apr 21,
2015 Affirmed Aa3 (sf)

US$600M Class Ac Notes, Affirmed Aa3 (sf); previously on Apr 21,
2015 Affirmed Aa3 (sf)

GBP75.2M Class Ba Notes, Affirmed Aa3 (sf); previously on Jul 23,
2015 Upgraded to Aa3 (sf)

GBP9M Class Ca Notes, Upgraded to Aa3 (sf); previously on Jul 23,
2015 Upgraded to A1 (sf)

EUR42.1M Class Cb Notes, Upgraded to Aa3 (sf); previously on Jul
23, 2015 Upgraded to A1 (sf)

GBP2M Class Da Notes, Upgraded to A3 (sf); previously on Jul 23,
2015 Upgraded to Baa3 (sf)

EUR28M Class Db Notes, Upgraded to A3 (sf); previously on Jul 23,
2015 Upgraded to Baa3 (sf)

GBP7.5M Class Ea Notes, Affirmed B3 (sf); previously on Apr 21,
2015 Upgraded to B3 (sf)

EUR10M Class Eb Notes, Affirmed B3 (sf); previously on Apr 21,
2015 Upgraded to B3 (sf)

RATINGS RATIONALE

The rating action is prompted by:

decreased key collateral assumptions, namely the portfolio
Expected Loss (EL) and MILAN CE assumptions due to better than
expected collateral performance

an increase in credit enhancement for the affected tranches

Revision of Key Collateral Assumptions:

As part of the rating actions, Moody's reassessed its lifetime loss
expectations and recovery rates for the portfolios reflecting their
collateral performance to date. Despite relatively high
delinquencies, the cumulative losses have remained stable since
last year. 90+ delinquencies are currently standing at:

(i) for Great Hall Mortgages No. 1 Plc Series 2006-01, 3.93%, and
cumulative losses at 1.65% up from 1.64% last year.

(ii) for Great Hall Mortgages No. 1 Plc Series 2007-01, 4.90%, and
cumulative losses at 2.41% up from 2.40% last year.

(iii) for Great Hall Mortgages No. 1 Plc Series 2007-02, 6.31%, and
cumulative losses at 2.67% up from 2.66% last year.

Moody's assumed the expected loss as a percentage of current pool
balance as follows:

(i) for Great Hall Mortgages No. 1 Plc Series 2006-01, 2.94%.

(ii) for Great Hall Mortgages No. 1 Plc Series 2007-01, 2.90%.

(iii) for Great Hall Mortgages No. 1 Plc Series 2007-02, 3.20%.

This corresponds to expected loss assumptions as a percentage of
original pool balance of:

(i) for Great Hall Mortgages No. 1 Plc Series 2006-01, 2.27%.

(ii) for Great Hall Mortgages No. 1 Plc Series 2007-01, 3.29%.

(iii) for Great Hall Mortgages No. 1 Plc Series 2007-02, 3.75%.

Moody's has also assessed loan-by-loan information as a part of its
detailed transaction review to determine the credit support
consistent with target ratings levels and the volatility of future
losses. As a result, Moody's has decreased the MILAN CE assumption
of Great Hall Mortgages No. 1 Plc Series 2007-02 to 20% from 21%.

Moody's has maintained the MILAN CE assumption for Great Hall
Mortgages No. 1 Plc Series 2006-01 at 16%, and for Great Hall
Mortgages No. 1 Plc Series 2007-01 at 20%.

Increase in Available Credit Enhancement

Sequential amortization and non-amortizing reserve funds led to the
increase in the credit enhancement available in these
transactions.

For instance, the credit enhancement for the tranches affected by
the rating action increased:

(i) for tranches Da and Db of Great Hall Mortgages No. 1 Plc Series
2006-01, to 10.95% from 5.81% at last rating action.

(ii) for tranches Da and Db of Great Hall Mortgages No. 1 Plc
Series 2007-01, to 10.61% from 5.98% at last rating action, and for
tranche Ea to 5.05 % from 2.84% at last rating action.

(iii) for tranches Ca and Cb of Great Hall Mortgages No. 1 Plc
Series 2007-02, to 17.31% from 9.50% at last rating action, and for
tranches Da and Db, to 9.18% from 5.04%.

The three transactions are amortising sequentially as some
performance triggers have been breached and are incurable, which
means their waterfalls cannot revert to pro-rata amortisation.

Moody's also considered how the liquidity available in the
transactions supports the ratings of the notes. In particular:

(i) for Great Hall Mortgages No. 1 Plc Series 2006-01, a reserve
fund of GBP5.3M and a liquidity facility of GBP4.6M.

(ii) for Great Hall Mortgages No. 1 Plc Series 2007-01, a reserve
fund of GBP13.2M and a liquidity facility of GBP10.7M.

(iii) for Great Hall Mortgages No. 1 Plc Series 2007-02, a reserve
fund of GBP9.4M and a liquidity facility of GBP10.6M.

The servicer is an unrated entity and the transactions' mitigating
structural features are not sufficient to achieve the Aaa (sf)
rating. As a result, Financial Disruption Risk constraints the
ratings of Classes A2a, A2b, Ba, Bb, Ca, Cb, Da and Db of Great
Hall Mortgages No. 1 Plc Series 2006-01 and Great Hall Mortgages
No. 1 Plc Series 2007-01 and of Classes Aa, Ab, Ac, Ba, Ca and Cb
of Great Hall Mortgages No. 1 Plc Series 2007-02.

The principal methodology used in these ratings was "Moody's
Approach to Rating RMBS Using the MILAN Framework" published in
December 2020.

The analysis undertaken by Moody's at the initial assignment of
ratings for RMBS securities may focus on aspects that become less
relevant or typically remain unchanged during the surveillance
stage.

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

Factors or circumstances that could lead to an upgrade of the
ratings include: (i) performance of the underlying collateral that
is better than Moody's expected; (ii) an increase in available
credit enhancement; (iii) improvements in the credit quality of the
transaction counterparties; and (iv) a decrease in sovereign risk.

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


HAMPSON HUGHES: Sold to Recovery First Following Administration
---------------------------------------------------------------
John Hyde at The Law Society Gazette reports that one of the most
prominent personal injury firms in the north west has been broken
up and sold, with staff made redundant as a result.

The Gazette understands that Liverpool-based Hampson Hughes was
officially placed into administration last week after attempts to
rescue the business were unsuccessful.

Insolvency firm Leonard Curtis was drafted in earlier this month to
advise on the orderly closing down of the business, after a
long-term fall in turnover brought on by personal injury reforms,
The Gazette recounts.

The firm was then subject to a pre-pack administration sale to
Recovery First Limited, which specializes in buying work in
progress from solvent and distressed firms and finding new homes
among its panel firm members to achieve the best outcome for
clients.  Files have now been transferred and the staff were told
last week to find alternative employment, The Gazette relates.

It is understood that director Paul Hampson, who has not actively
worked in the firm for three years and was not aware of the closing
down plans, made a last-minute offer to try to preserve the
business, The Gazette states.  This was rejected and the company
was placed into administration, The Gazette notes.

Accountancy firm Grant Thornton has been appointed as joint
administrator to review the closing down process, The Gazette
discloses.

Hampson Hughes was founded in 2009 and worked only in personal
injury and clinical negligence work -- much of which has become
less profitable through a series of government reforms culminating
in the Civil Liability Act, which scrapped recoverability of legal
fees for whiplash claims valued less than GBP5,000, The Gazette
relays.

But the downfall of the business preceded the most recent changes,
according to published accounts, The Gazette says.  Turnover
slipped from GBP12.9 million in 2017 to GBP9.3 million in 2018 and
then to GBP5.7 million in 2019, The Gazette states.  Operating
profits dropped from GBP1.35 million in 2017 to GBP218,000 in 2019,
while the number of staff fell from 200 to 132 in just a year,
according to The Gazette.  By the end, the headcount had fallen to
around 20 and no new matters had been taken on for some time except
for clinical negligence work, The Gazette states.


INTU: Council Misses Out on Cash to Demolish Broadmarsh Centre
--------------------------------------------------------------
BBC News reports that a city council has missed out on GBP20
million of government funding to demolish a derelict shopping
centre.

The Broadmarsh centre in Nottingham was owned by Intu, who went
into administration in June 2020 part-way through a major
redevelopment, BBC relates.

According to BBC, the council had applied for the money from the
levelling up fund to complete clearance of the site.

The Broadmarsh centre has seen a succession of renovation schemes
fall through in the past 20 years, BBC notes.

The Local Democracy Reporting Service said the council has already
secured funding to demolish the western end of the shopping centre
near Maid Marian Way, BBC recounts.


NMCN: Government Takes on GBP75MM Sewage Treatment Project
----------------------------------------------------------
Ed Taylor at Jersey Evening Post reports that a GBP75 million
project to replace the Island's ageing sewage treatment plant has
officially been taken on by the government after a private
contractor went into administration.

NMCN, based in Nottinghamshire, had reportedly racked up losses of
GBP43 million, Jersey Evening Post relates.  Earlier this month,
its board said that it was unable to allow the business to continue
trading as a going concern, Jersey Evening Post notes.

According to Jersey Evening Post, the project, which had been
scheduled to be completed next year, is now being overseen by the
Infrastructure, Housing and Environment Department.  The JEP has
asked how much money has been paid to NMCN and whether any is
recoverable, Jersey Evening Post discloses.


SHERWOOD PARENTCO: Fitch Assigns 'BB-' LT IDR, Outlook Stable
-------------------------------------------------------------
Fitch Ratings has assigned Sherwood Parentco Limited (Arrow) a
Long-Term Issuer Default Rating (IDR) of 'BB-' with a Stable
Outlook. Fitch has also assigned an expected long-term rating of
'BB-(EXP)' to senior secured debt to be issued by Sherwood
Financing Plc and guaranteed by Arrow (among other Sherwood
entities). The assignment of a final issue rating is contingent on
the receipt of final documents conforming to the information
already received.

Arrow is the parent company of Sherwood Acquisitions Limited, a
UK-based entity set up by TDR Capital LLC (and owned by investment
funds managed by TDR Capital LLC) to acquire Arrow Global Group
Plc, a UK-based debt purchaser and investor in non-performing loans
(NPLs). As the top holding company producing consolidated accounts
within a restricted banking group, Fitch has assigned the Long-Term
IDR at the level of Arrow rather than at the level of Sherwood
Acquisition Limited.

The acquisition, valuing Arrow Global Group Plc's ordinary share
capital at GBP565 million, was completed on 12 October 2021. As
part of the acquisition, Sherwood Acquisitions Limited set up
EUR975 million and GBP400 million one-year extendable senior
secured bridge facilities which it intends to refinance through the
issue of around GBP1.2 billion-equivalent in euro fixed- and
floating-rate and sterling fixed- rate senior secured notes.

KEY RATING DRIVERS

LONG-TERM IDR

High Leverage: Arrow's Long-Term IDR is constrained by high cash
flow leverage with a gross debt/adjusted EBITDA ratio as calculated
by Fitch of around 5.8x at end-1H21 (based on annualised 1H21
adjusted EBITDA), equating to a capitalisation and leverage score
of 'b and below'. Fitch expects Arrow's outstanding gross debt to
remain broadly unchanged following the planned debt issue and cash
flow leverage as of end-2021 to improve to around 5x, largely as a
result of improving cash EBITDA on the back of resilient
collections and improving revenue in the fund-management and
servicing segments.

Similar to many European peers', Arrow's tangible equity position
is negative, following material inorganic growth, which Fitch
expects to remain the case under the new ownership. This is
reflected in Fitch's capitalisation and leverage assessment.

Credible Franchise, Evolving Business Model: Arrow's franchise,
measured by both estimated remaining collections (ERC) and adjusted
EBITDA, is moderately smaller than those of higher-rated peers and
concentrated on a relatively small number of markets, notably the
UK, Ireland, Portugal, Italy and the Netherlands.

However, Fitch's assessment of Arrow's franchise and business model
also considers the company's recently launched fund- and
investment-management (FIM) business line, which in Fitch's view
has good growth prospects and is less capital-intensive than
traditional debt purchasing but is also subject to the execution
risk (Arrow launched its first flagship fund, ACO 1, in 2019).
Unlike many peers, Arrow largely targets smaller and often
off-market transactions, which are less price- sensitive than more
standard auction-led transactions.

Sizeable 2020 Impairments; 1H21 Recovery: In 2020, Arrow's adjusted
EBITDA margin and pre-tax profitability were negatively affected by
sizeable pandemic-related portfolio-investment impairment charges
in 2Q20. In Fitch's view, this partly reflects Arrow's portfolio
composition with meaningful exposure to secured assets in southern
Europe (affected by lengthy court closures) but also management's
prudent ERC reforecasting in 2Q20 as reflected in Arrow's actual
collections consistently exceeding reforecast ERC since 2H20. Under
its new, more asset-light business model, impairment charges will
likely have a less noticeable impact on overall profitability
(Arrow targets more than 50% of EBITDA from capital-light
activities by end-2025), supporting increased revenue and earnings
stability.

Cohesive but Ambitious Capital-Light Strategy: Unlike most of its
peers, Arrow is transitioning from a conventional debt purchaser to
primarily a manager of funds investing in NPL portfolios as well as
servicer of these assets. Own balance-sheet usage will largely be
limited to co-investments in funds (at around 25% of total fund
size in the case of ACO 1 but with expectations that the
co-investment ratio will reduce to around 10% in the case of
follow-on funds). While Arrow can point to a long record of
acceptable collection performance, management's plans for follow-on
funds and hence funds under management (FuM) growth are, in Fitch's
view, ambitious (FuM of more than EUR10 billion by end-2025) and
sensitive to any meaningful collection under-performance.

Governance Unchanged Following Delisting: In line with most listed
peers, Arrow operates a three-lines-of-defence model supported by
various board committees. All new investments are approved by the
company's investment committee, and ERC and portfolio investments
are valued both internally and with an external auditor's
attendance. Following its delisting and new ownership, Fitch
expects Arrow's governance structure to remain broadly in place,
supporting Fitch's view of the company's risk and corporate
governance. With some exceptions, Arrow's senior management team
has generally fairly short tenors with the company, but extensive
professional experience in the relevant sectors.

Long-Dated Funding Profile; Adequate Coverage: Arrow's EBITDA
coverage ratio is acceptable and the company benefits from a
long-dated post-transaction funding profile (no bond maturities
until 2026) and sound contingent liquidity through a long-dated
undrawn GBP285 million revolving credit facility (RCF). However,
Fitch's assessment of its funding, liquidity and coverage score
also considers its almost entirely secured funding profile
(limiting its financial flexibility) and the wholesale nature of
its funding sources.

Arrow's funding, liquidity and coverage benchmark ratio has
remained within Fitch's 'bb' range in the last four financial
years. Under Fitch's base case, Fitch projects the ratio to remain
within the 'bb' range until 2024.

SENIOR SECURED DEBT

As Arrow's planned senior secured notes are the company's main
outstanding debt class (and effectively junior to Arrow's sizeable
RCF), Fitch has equalised the notes' ratings with the Long-Term
IDR, indicating average recoveries for the notes.

RATING SENSITIVITIES

LONG-TERM IDR

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

-- As Arrow's Long-Term IDR is currently constrained by leverage,
    any positive rating action would require a material and
    sustained improvement in the gross leverage ratio to well
    within Fitch's 'bb' benchmark range (gross debt/adjusted
    EBITDA between 2.5x and 3.5x). In addition, an upgrade could
    be supported by a successful implementation of Arrow's
    capital-light asset management strategy, for instance, through
    a successful rollout of the follow-on fund to ACO 1 in 2022.

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

-- Material delays in rolling out its capital-light strategy
    (including delays in anticipated fundraising or capital
    deployment in follow-on funds), in particular if impairing
    Arrow's deleveraging potential or indicative of general
    collection under-performance, would put pressure on Arrow's
    ratings.

-- Inability to meet its 2023 leverage guidance of net leverage
    (net debt/ adjusted EBITDA) of 3.0x to 3.5x, could also put
    pressure on ratings.

-- Material collection under-performance, in particular, if it
    leads to further meaningful portfolio impairments, could be
    rating-negative. A material increase in risk appetite or
    weakening of risk or corporate governance, following its
    delisting, albeit not expected by Fitch, would also put
    pressure on ratings.

SENIOR SECURED DEBT

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

-- The expected rating of the senior secured notes is principally
    sensitive to a change in Arrow's Long-Term IDR and an upgrade
    of the Long-Term IDR would likely be mirrored in an upgrade of
    the notes. In addition, improved recovery expectations, for
    instance, through a larger layer of junior debt, could lead
    Fitch to notch up the notes from Arrow's Long-Term IDR.

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

-- A downgrade of the Long-Term IDR would likely be mirrored in a
    downgrade of the notes. In addition, worsening recovery
    expectations, for instance, through a larger layer of
    structurally senior debt, could lead Fitch to notch down the
    notes from the Long-Term IDR.

BEST/WORST CASE RATING SCENARIO

International scale credit ratings of Financial Institutions and
Covered Bond 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.

ESG CONSIDERATIONS

Arrow has an ESG Relevance Score of '4' for 'Financial
Transparency' due to the significance of internal modelling to
portfolio valuations and associated metrics such as estimated
remaining collections. However, this is a feature of the
debt-purchasing sector as a whole, and not specific to Arrow. This
has a moderately negative impact on the credit profile, and is
relevant to the rating in conjunction with other factors.

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


SHERWOOD PARENTCO: Moody's Assigns B1 CFR & Rates Secured Notes B1
------------------------------------------------------------------
Moody's Investors Service assigned a B1 corporate family rating to
Sherwood Parentco Limited ("Sherwood") and B1 senior secured rating
to the euro fixed and floating rate and sterling fixed rate senior
secured notes, in the aggregate amount of approximately GBP1.2
billion-equivalent, to be issued out of Sherwood Financing plc. The
outlook is stable for both entities.

In the same rating action, Moody's withdrew the Ba3 corporate
family rating and negative outlook of Sherwood's predecessor entity
Arrow Global Group PLC ("Arrow"), which was acquired by the private
equity firm TDR Capital on October 11, 2021.

RATINGS RATIONALE

The B1 CFR assigned to Sherwood Parentco Limited ("Sherwood")
reflects the financial profile of the new entity, which has been
created by the acquisition of Arrow Global Group PLC ("Arrow") by
the private equity firm TDR Capital, and Sherwood's expected
performance in the next 12-18 months. Specifically, the assigned
CFR of B1 for Sherwood reflects the expected increase in
Debt/EBITDA leverage at the time of the acquisition, which Moody's
estimates will be approximately 5x on a pro-forma basis, based on
Arrow's annualised EBITDA for H1 2021 and the announced amount of
the debt offering. In addition, the CFR of B1 reflects moderate
interest coverage, with EBITDA/Interest Expense of approximately 4x
on a pro-forma basis, according to Moody's calculations,
meaningfully below the predecessor entity's pre-pandemic interest
coverage of 6x. At the same time, the CFR incorporates Moody's
expectations that Sherwood's leverage and interest coverage will
improve in the next 12 months, as collections from new portfolio
purchases boost Sherwood's EBITDA.

The B1 CFR also reflects the diversified business model of the
predecessor entity Arrow, which Moody's expects Sherwood to retain
and develop further. In addition to the direct investment business,
Sherwood will maintain capital-light, fee-based fund and investment
management and asset management and servicing businesses. The new
entity will also retain a relatively large exposure to the
countries in Southern Europe (47% of Estimated Remaining
Collections as of June 2021) that have been particularly affected
by the coronavirus crisis.

Finally, the B1 CFR reflects the absence of the immediate
refinancing risk of the new entity, given that the earliest
anticipated maturity of the new notes will be 5 years from the
transaction closing, as well as Sherwood's weak capitalisation,
with a tangible equity deficit, and the regulatory risk inherent to
the debt collection business.

The senior secured debt rating reflects the application of Moody's
Loss Given Default for Speculative-Grade Companies methodology and
the priorities of claims in Sherwood's liability structure.

RATIONALE FOR STABLE OUTLOOK

The stable outlook reflects Moody's expectation that the newly
formed entity will generate solid profitability and demonstrate
strong collection activity in all key regions in the next 12-18
months, which will enable it to de-lever, while improving its
interest coverage ratio.

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

Sherwood's CFR could be upgraded if the company improves its
interest coverage and leverage ratios to the predecessor entity's
pre-pandemic level, while demonstrating solid and consistent
profitability.

Sherwood's CFR could be downgraded if the company's profitability
weakens, leading to a deterioration in interest coverage and
leverage. Sherwood's senior secured ratings could be downgraded if
the company's usage of its secured credit facility proves to be
substantially higher than anticipated.

Sherwood's senior secured ratings could be upgraded/downgraded with
a corresponding change in the CFR.

PRINCIPAL METHODOLOGY

The principal methodology used in these ratings was Finance
Companies Methodology published in November 2019.


SHERWOOD PARENTCO: S&P Assigns Prelim 'B+' ICR, Outlook Stable
--------------------------------------------------------------
S&P Global Ratings assigned its 'B+' preliminary long-term issuer
credit rating to Sherwood Parentco Limited (Sherwood).

S&P assigned a preliminary rating of 'B+' to the new issuance by
Sherwood, in line with its 'B+' preliminary rating on Sherwood.

S&P expects to convert the rating to final from preliminary at the
settlement of Sherwood's bond transaction. Its final rating is
subject to a review of the finalized bond documentation.

Sherwood has acquired distressed debt purchaser, distressed asset
servicer, and fund manager Arrow Global Group PLC (Arrow). The
acquired assets and Arrow servicing platform are well positioned in
a growing market for European distressed assets, and the
acquisition comes as Arrow has successfully pivoted toward
asset-light servicing and fund management over the past 18 months.

Sherwood is now the owner of Arrow Global Group's operations, and
Sherwood's ownership by private equity sponsor TDR is an important
rating constraint. Sherwood is a BidCo, fully owned by TDR, and it
purchased Arrow for a total consideration of GBP563 million.
Arrow's operations will continue to operate under the same
branding, and the management organization of Arrow is substantively
unchanged following the deal's closure. S&P said, "Although TDR is
experienced in the operations of European financial institutions,
we remain cautious regarding the group's financial policy over the
first 12 to 18 months of the new group. Our base case remains for
relatively prudent financial management, but we see a remote risk
that TDR could consider deploying further leverage for mergers and
acquisitions in the European market, or to accelerate purchases in
the group. Actions like these could meaningfully dilute our
generally favorable view of Arrow's solid liquidity under our base
case. Over the next 12 to 18 months, at least, TDR's ownership of
Arrow will be an important rating constraint. Thereafter, we could
consider a more favorable view of TDR's ownership if the group can
demonstrate a stable financial policy and good financial
discipline. The group's new capital structure contains significant
financial flexibility to proactively repay debt, and if such an
event came to pass, we could view Sherwood's financial sponsor
owners more positively."

S&P said, "Our revised base case assumes a subdued recovery in the
group's earnings and performance during 2021 and 2022. Stable, if
subdued, performance improvement, elevated costs, and a refreshed
capital structure are at the core of our base case for Sherwood
over the first 12-18 months of its ownership of Arrow. We now
expect collections to remain below 2019 levels until 2023, at the
earliest. This is partially offset by quicker growth in servicing
revenue, which proved resilient in 2020 and was ahead of our
expectations, and good fund management income growth for the
period. When we combine this uneven earnings outlook with an
increased cost base after the deal closes, we do not expect EBITDA
to reach pre-pandemic levels on a cash or statutory basis before
the end of 2023. Specifically, within our cost forecasts, we expect
a one-off restructuring expense of GBP10 million-GBP20 million in
2022 and 2023."

The new capital structure of the group is broadly leverage neutral.
Sherwood has launched three tranches of senior secured bond
financing (totaling roughly GBP1.2 billion) to repay the bridge
facility used to repay Arrow's existing GBP990 million of senior
secured notes at its acquisition. The quantum of these bonds is
greater than the previously outstanding senior secured notes issued
by Arrow Finance PLC, and surplus issuance via the bridge has been
used to reduce the outstanding balance on the group's GBP285
million revolving credit facility (RCF). At year-end 2020, total
drawing on the RCF was roughly GBP200 million. As such, the
refinancing of the deal will be broadly leverage neutral on a gross
debt basis when accounting for this repayment. S&P said, "We
assigned a preliminary rating of 'B+' to the new issuance by
Sherwood, in line with our 'B+' preliminary rating on Sherwood.
This rating reflects our '4' recovery rating on the bonds,
indicating an expected recovery of 40% on the senior secured bonds
in the event of default."

S&P said, "Our updated base case and the new group capital
structure leads to S&P Global Ratings-adjusted leverage above 5x
for much of the next 12 months. Although the new capital structure
is leverage neutral, in the first instance we expect the group's
leverage position to weaken on the back of our revised expectations
for performance. Following 2020's leverage spike, we would expect
the group's leverage to end 2021 at about 5.3x, and move below 5x
only gradually through 2022, ending the year at 4.7x-5.0x. Taken
together, this points to a highly leveraged adjusted debt to EBITDA
profile, and the direction of travel is similar on an unadjusted
basis. This consistently high adjusted and unadjusted leverage
drives our highly leveraged financial risk profile assessment.

"Despite elevated leverage, the group's interest coverage remains
solid and its liquidity profile flexible, and we expect the group's
liquidity uses to remain low. Although our financial risk profile
is led by the combination of Arrow's leverage profile and financial
sponsor ownership, broad strengths remain to the group's rating.
The group will continue to operate with a solid cushion of earnings
above interest expense, with our expected interest coverage ratio
of about 5x sitting at the upper end of the peer set. At the same
time, we expect the group to operate with significant liquidity,
characterized by near full headroom in its RCF, we expect a small
draw of GBP40 million-GBP50 million at deal close, and a modest
level of annual portfolio purchases under our base case. Indeed, we
expect the group to purchase at or around its replacement rate, or
the level required to hold its estimated remaining collections
flat--a level that should be covered by free cash flow generation.
This latter point should support a stable gross debt profile and
leave room for excess cash generation in the group. If the group
elects to deploy this cash for proactive debt repayment, we could
consider altering our assessment of its financial sponsor ownership
in due course, although this is unlikely in the next 12 months.

"Despite a weaker financial position, prospects for the group's
core business lines remain favorable. We see Arrow's core balance
sheet business as well-positioned in the European market, with good
asset diversification across Europe and stable local franchises.
Combined with the resilient servicing business and the growth and
success of the fund management business, we see Arrow as
well-placed to generate stable earnings and profitability over the
medium term, while moving away from its previously aggressive
capital deployment.

"The stable outlook reflects our expectation that Sherwood, through
its Arrow operating subsidiaries, will operate with gradually
reducing, though elevated, financial leverage over the next 12
months. Notably we expect average adjusted debt to EBITDA to hover
around 5x over the next 24 months. We expect this trend to be
supported by the group's continued pivot toward fund management and
asset servicing in the European distressed debt market, with a
continued stable, profitable performance in the group's balance
sheet business."

Downside scenario

S&P could lower the ratings by one notch following a period of
sustained underperformance or significantly accelerated capital
deployment that undermined our broad view of the group's financial
stability. This would include adjusted debt to EBITDA persistently
above 5x beyond 2022. This could be precipitated by rapid, material
drawing under the group's RCF, likely to fund mergers and
acquisitions or significant portfolio purchases, which would
increase leverage and worsen the group's liquidity position.

Upside scenario

S&P said, "We believe that an upgrade in our ratings on Sherwood or
its debt instruments is unlikely over the next 12 months. In the
medium term we could see upside in the rating if the group can
reduce its leverage effectively, with its cash adjusted leverage
around 3.5x on a sustained basis, while demonstrating stable
financial discipline. Under our base case, we do not expect this
before 2023 at the earliest."


SIG PLC: Egan-Jones Retains B+ Senior Unsecured Ratings
-------------------------------------------------------
Egan-Jones Ratings Company, on October 11, 2021, maintained its
'B+' foreign currency and local currency senior unsecured ratings
on debt issued by SIG plc.

Headquartered in Sheffield, United Kingdom, SIG plc distributes
specialty building products.


TESCO PLC: Egan-Jones Keeps BB+ Senior Unsecured Ratings
--------------------------------------------------------
Egan-Jones Ratings Company, on October 12, 2021, maintained its
'BB+' foreign currency and local currency senior unsecured ratings
on debt issued by Tesco PLC.

Headquartered in Welwyn Garden City, United Kingdom, Tesco PLC,
through its subsidiaries, operates as a food retailer.



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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-
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Marites O. Claro, Rousel Elaine T. Fernandez, Joy A. Agravante,
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Editors.

Copyright 2021.  All rights reserved.  ISSN 1529-2754.

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