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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

          Wednesday, January 19, 2022, Vol. 23, No. 8

                           Headlines



A U S T R I A

AMS AG: S&P Affirms 'BB-' LT ICR & Alters Outlook to Positive


F I N L A N D

AMER SPORTS 1: Moody's Alters Outlook on B3 CFR to Positive


F R A N C E

DELACHAUX GROUP: Moody's Affirms B2 CFR & Alters Outlook to Stable
ETHYPHARM SAS: S&P Lowers ICR to 'B-', Outlook Stable


G E R M A N Y

CHEPLAPHARM ARZNEIMITTEL: Fitch Puts 'B+' LT IDR on Watch Positive
CHEPLAPHARM ARZNEIMITTEL: S&P Puts 'B' LT ICR on Watch Positive


G R E E C E

NAVIOS MARITIME: Moody's Ups CFR to B3 & Alters Outlook to Stable


I R E L A N D

ARBOUR CLO X: Fitch Assigns Final B- Rating on Class F Debt
ARBOUR CLO X: Moody's Assigns B3 Rating to EUR12MM Class F Notes
FINANCE IRELAND 4: S&P Assigns Prelim. B-(sf) Rating on X Notes
MADISON PARK XI: Fitch Raises Class E Notes Rating to 'BB+'
[*] IRELAND: RAI Calls for Tax Amnesty for Hospitality Firms



I T A L Y

WEBUILD SPA: Fitch Gives 'BB(EXP)' Rating on New EUR500MM Notes
WEBUILD SPA: S&P Assigns 'BB-' Rating on New EUR500MM Notes


N E T H E R L A N D S

ARTISAN NEWCO: Moody's Assigns First Time 'B2' Corp. Family Rating
GROUP OF BUTCHERS: S&P Assigns Prelim. 'B' ICR, Outlook Stable


S W I T Z E R L A N D

AUTOFORM ENGINEERING: S&P Assigns Prelim. 'B' ICR, Outlook Stable


U N I T E D   K I N G D O M

ADVANZ PHARMA: New Incremental Notes No Impact on Moody's B3 CFR
ADVANZ PHARMA: S&P Alters Outlook on 'B-' ICR to Stable
CARILLION: Jr. Auditor Unaware He Was Doing Anything Wrong
CIDRON AIDA: Fitch Affirms B+ Rating on Sr. Secured Debt
DERBY COUNTY FOOTBALL: Golden Share Likely to Be Suspended

EDF ENERGY PLC: S&P Puts 'BB-' LongTerm ICR on Watch Negative
FERROGLOBE PLC: Moody's Alters Outlook on Caa1 CFR to Positive
GRIBBLES BUTCHERS: Owes More Than GBP300,000 to Creditors
QUEENS HOTEL: Auction Scheduled for February 3
RAINBOW UK 2: Moody's Assigns B2 CFR, Outlook Positive

RAINBOW UK 2: S&P Assigns Preliminary 'B' ICR, Outlook Stable
STRATTON BTL 2022-1: S&P Assigns Prelim. B- Rating on X2 Certs
THOMAS COOK: Former Directors Cleared of Wrongdoing by Regulator
ZEUS BIDCO: Moody's Assigns First Time 'B1' CFR, Outlook Stable
ZEUS BIDCO: S&P Assigns 'B+' Issuer Credit Rating, Outlook Stable

[*] UK: Hundreds of Construction Firms Going Bust Every Month

                           - - - - -


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A U S T R I A
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AMS AG: S&P Affirms 'BB-' LT ICR & Alters Outlook to Positive
-------------------------------------------------------------
S&P Global Ratings revised its outlook on Austrian sensor solutions
provider ams AG to positive from negative and affirmed its 'BB-'
long-term issuer credit rating on the company.

The positive outlook reflects the possibility of an upgrade if ams
deleverages further, supported by divestments and continued
profitability improvement upon the smooth integration of OSRAM,
resulting in accrued synergies and lower restructuring and
integration costs.

S&P expects ams' credit ratios will improve significantly in 2022.
S&P forecasts the company's S&P Global Ratings-adjusted debt to
EBITDA will strengthen to 2.5x or below in 2022, from 3.5x in 2021,
and adjusted free operating cash flows (FOCF) of close to EUR400
million in 2022 from about EUR375 million in 2021, because of the
following factors:

The sales of noncore assets. Up until now, ams has secured
approximately EUR355 million of proceeds from the sale of OSRAM's
digital system business in North America and OSRAM's
building-related business in 2021, and Fluence in 2022. S&P expects
these proceeds will support the group's cash flow and translate
into stronger credit metrics. Management has announced it seeks to
reach minimum proceeds of $500 million from the divestment of
noncore and low-profitability assets, and is planning to divest
assets of the dissolved Continental JV. S&P therefore believes ams
has potential to further deleverage from our base-case scenario
should additional proceeds materialize in 2022.

Strengthened profitability and cash flow as the company gradually
achieves synergies on headcounts, joint procurement, and external
sales, general, and administrative costs from its combination with
OSRAM. As of Sept. 30, 2021, ams achieved EUR130 million of
synergies, or about 37% of the total. Furthermore, the divestment
of noncore assets that report low profitability boosts further the
organization's margins. S&P expects it will translate into the S&P
Global Ratings-adjusted EBITDA margin improving to 18%-20% in 2022
from 16%-18% in 2021.

Low single-digit organic revenue growth that is supported by the
group's focus on advanced technologies with above-market growth
prospects, and the gradual diversification of its consumer segment
into the Android ecosystem. This includes the full-year impact of
the loss of market share with ams' no. 1 customer (which now
represents less than 20% of total revenue), and global supply
constrain will likely hamper additional growth prospects despite a
strong order backlog. S&P thinks the revenue trajectory could
accelerate to high-single-digit annual growth by 2024.

Management's financial policy targeting reported net debt on
management's adjusted EBITDA below 2.0x, which--as EBITDA grows and
integration/restructuring costs decline--could translate into S&P
Global Ratings-adjusted leverage of about or less than 2.5x
(adjusted for the put option that the minority shareholders of
OSRAM can exercise). Because of the strong cash flow, ams has the
capacity to deleverage more but S&P believes that the group will
ultimately continue its acquisitive strategy, start paying
dividends to its shareholders, or buy back shares but always in
adherence with its stated financial policy.

A delay in integrating OSRAM and operational challenges could
diminish ams' deleveraging prospects. S&P said, "Our rating factors
in risks around the integration of OSRAM and execution of planned
synergies, which could slow the deleveraging we forecast in our
base-case scenario. The acceptance of the Domination and Profit and
Loss Agreement in early March 2021 has taken longer than expected,
delaying by a few months the kick-off of management's divestment
and synergy plans. Although on track, there is still a lot to
achieve in terms of revenue and cost synergies from the ams-OSRAM
combination. We are also mindful that OSRAM's profitability and
cash flow has been relatively weak in recent years--with
low-single-digit EBITDA margin and negative free cash
flow--affected by inventory buildup and a volatile economy
translating into weaker demand and supply chain constraints hitting
mainly its auto and industrial divisions. Furthermore, our rating
assessment factors in potential volatility in ams' credit ratios in
the absence of a track record of stable cash flow and credit
metrics from the group and OSRAM over the business cycle. Finally,
while growth prospects are solid, we believe the group is not
immune to operational set-back as demonstrated by the recent loss
of market share with ams' no. 1 customer affecting the top line by
about EUR300 million in 2021 and the ongoing capacity constraints
at foundries that have limited its organic growth prospects,
despite a strong backlog."

The positive outlook reflects the possibility of an upgrade if ams
deleverages further, supported by divestments and continued
profitability improvement upon the smooth integration of OSRAM,
resulting in accrued synergies and lower restructuring and
integration costs.

S&P said, "We could raise the ratings over the next 12 months if
ams reaches its synergies from the integration of OSRAM,
strengthens its profitability, and receives proceeds from
additional sales of noncore and low-profitability assets,
translating into an adjusted debt to EBITDA sustainably below 2.5x
and FOCF to debt exceeding 15%.

"We would revise our outlook to stable if the group's EBITDA growth
slows against our base-case scenario, resulting in and S&P Global
Ratings-adjusted debt to EBITDA of above 2.5x and FOCF to debt of
materially less than 15%." This could result from weaker
performance (unexpected loss of market share or market demand, or
supply chain or distributors' inventories disruption), or
challenges in deriving synergies from the combination with OSRAM,
leading to weaker profitability and cash flow than in our base
case. This could also follow a stop in the group's strategy to
divest additional noncore assets, or a more aggressive financial
policy oriented toward inorganic growth or shareholder remuneration
to the expense of deleveraging.




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AMER SPORTS 1: Moody's Alters Outlook on B3 CFR to Positive
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Moody's Investors Service has changed to positive from stable the
outlook on the ratings of Amer Sports Holding 1 Oy's (Amer Sports),
a global sporting goods company. Concurrently, Moody's has affirmed
the company's B3 corporate family rating  and its B3-PD probability
of default rating. Moody's has also affirmed the B3 ratings on the
EUR1,700 million guaranteed senior secured term loan B (TLB) due
2026 and the EUR315 million guaranteed senior secured revolving
credit facility (RCF) due 2025, both borrowed by Amer Sports'
subsidiary, Amer Sports Holding Oy.

"The outlook change to positive reflects Amer Sports' sustained
strong operating performance, which will lead to a faster
deleveraging profile than previously anticipated, with Moody's
adjusted gross leverage ratio reducing to below 6.5x over the next
12-18 months," says Pilar Anduiza, Moody's lead analyst for Amer
Sports.

RATINGS RATIONALE

Amer Sports' operating performance in 2021 has exceeded Moody's
expectations at the beginning of the year. Consumer demand for
sports apparel, footwear and individual ball sports equipment has
proven to be stronger than expected across all segments, driving
revenue growth of 29% YTD September 2021. The Chinese market, which
is predominantly direct-to-consumer (D2C), continued to outperform
other segments reaching an estimated EUR300 million in revenues in
2021, compared with EUR190 million in 2019.

In 2021, the company voluntarily prepaid EUR100 million of its TLB
and EUR162 million drawings under the RCF in 2021. As a result,
Amer Sports' financial leverage, measured as Moody's adjusted gross
debt to EBITDA, improved to around 7.2x in 2021 from 10x in 2020.

Moody's expects the company's sales growth to continue to be strong
in 2022. Growth will come mainly from the expansion of the retail
network in China, investment in the Salomon brand and the rapid
development of the Arc'teryx brand. However, the rating agency
notes that the company's expansion plan entails execution risks and
requires significant marketing, capital spending and working
capital utilization, which will drive negative FCF generation until
at least 2023. Additionally, challenges in the global supply chain
and uncertainty regarding the evolution of the coronavirus pandemic
remain key risks to the company's growth prospects for next year.

Based on Moody's forecasts, Amer Sports' gross leverage in 2022
will trend towards 6.5x. However, profitability in 2022 will likely
remain affected by the current inflationary environment. The
company's Moody's adjusted EBIT margin will remain modest as a
result of increased commodity prices and higher logistic costs
being partly offset by channel mix, price increases and cost saving
initiatives.

Amer Sports' B3 CFR continues to be supported by (1) its large
scale and leading market positions, underpinned by a large and
diversified portfolio of globally recognised brands; (2) its broad
diversification across sports segments and geographies; (3) the
favourable long-term demand dynamics of the sporting goods market,
with additional growth potential from the company's expansion into
the D2C channel of the Chinese outdoor apparel market; and (4) the
strategic guidance and potential financial support from its
shareholders ANTA Sports Products Limited (ANTA Sports),
FountainVest Partners Co Ltd, Mr. Chip Wilson, and Tencent Holdings
Limited.

The B3 rating is constrained by (1) the exposure to discretionary
consumer spending, which creates earnings volatility; (2) the
significant capital spending and marketing expenses required to
implement its expansion strategy, which will exert pressure on
margins; (3) the relatively weak EBIT-to-interest cover ratio of
around 1x; and (4) the expectation that the company will generate
negative free cash flow in the next two years to sustain the retail
expansion.

LIQUIDITY

With a fully undrawn EUR315 million RCF and EUR318 million of cash
on balance sheet at September 2021, Amer Sports' liquidity is
adequate. Based on the rating agency's forecasts, these liquidity
sources will be sufficient to cover the company's cash needs over
the next 12-18 months, which include planned capex of around
EUR150- EUR190 million annually (i.e. including around EUR60
million related to the lease adjustment), mainly to support the
ambitious retail expansion plan in China.

Amer Sports faces significant EBITDA and working capital
seasonality, with the largest cash outflows in Q2 and Q3,
respectively. The sustained capex plan, together with dividend
payments to service the interest on the EUR3.3 billion shareholder
loan and higher working capital requirements, will lead to a
negative free cash flow generation in the range of EUR100 million -
EUR150 million in 2022. FCF will improve from 2023 onwards to
levels of around EUR50-70 million p.a.

The company's RCF contains a financial covenant of senior secured
net leverage not exceeding 8.0x, tested when (1) the facility is
used for more than 40% of its committed amount, and (2) the
company's cash balance is below a certain level. Given the
reduction in the company's net leverage and the ample cash balance,
the rating agency expects Amer Sports to maintain sufficient
capacity under this covenant.

STRUCTURAL CONSIDERATIONS

The B3 ratings assigned to the EUR1,700 million guaranteed senior
secured TLB due 2026 and the EUR315 million guaranteed senior
secured RCF due 2025 are in line with the CFR, reflecting that
these two instruments rank pari passu and represent substantially
all of the company's financial debt. The TLB and the RCF are
secured by pledges over Amer Sports' major brands, as well as
shares, bank accounts and intragroup receivables, and are
guaranteed by the group's operating subsidiaries representing at
least 80% of the consolidated EBITDA. The B3-PD probability of
default rating assigned to Amer Sports reflects the assumption of a
50% family recovery rate, given the limited set of financial
covenants comprising only a springing covenant on the RCF.

RATIONALE FOR POSITIVE OUTLOOK

The positive outlook reflects Moody's expectations that Amer
Sports' credit metrics will progressively improve over the next
12-18 months, on the back of strong demand primarily in China, as
well as continued focus on cost savings, leading to Moody's
adjusted leverage trending towards 6.5x. The positive outlook also
assumes that the company will maintain at least adequate liquidity
and comfortable capacity under its financial covenant.

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

Positive pressure on the ratings could materialise over time if the
company demonstrates a consistent revenue and EBITDA recovery path,
leading to (1) a reduction in financial leverage, measured as
Moody's adjusted gross debt to EBITDA trending towards 6.5x on a
sustainable basis; (2) the generation of sustained positive free
cash flows, and (3) the maintenance of a solid liquidity profile.

The ratings could be downgraded if the company's operating
performance weakens or it engages in large debt-financed
acquisitions that lead to an increase in leverage from current
levels. Negative pressure on the rating could build up in case of a
material deterioration in the company's liquidity profile, as a
result of negative free cash flow generation for a prolonged period
of time, or reduced capacity under its financial covenant.

LIST OF AFFECTED RATINGS

Affirmations:

Issuer: Amer Sports Holding 1 Oy

Probability of Default Rating, Affirmed B3-PD

LT Corporate Family Rating, Affirmed B3

Issuer: Amer Sports Holding Oy

BACKED Senior Secured Bank Credit Facility, Affirmed B3

Outlook Actions:

Issuer: Amer Sports Holding 1 Oy

Outlook, Changed To Positive From Stable

Issuer: Amer Sports Holding Oy

Outlook, Changed To Positive From Stable

PRINCIPAL METHODOLOGY

The principal methodology used in these ratings was Consumer
Durables published in September 2021.

COMPANY PROFILE

Domiciled in Helsinki, Finland, Amer Sports is a global sporting
goods company, with sales in more than 30 countries across EMEA,
the Americas and APAC. Focused on outdoor sports, its product
offering includes apparel, footwear, winter sports equipment and
other sports accessories. Amer Sports owns a portfolio of globally
recognised brands such as Arc'teryx Salomon, Wilson, Peak
Performance and Atomic, encompassing a broad range of sports,
including alpine skiing, running, tennis, baseball, American
football, diving, hiking and golf. For the LTM ended September
2021, Amer Sports generated revenues of EUR2.5 billion and
company-adjusted EBITDA, i.e. excluding non-recurring items and
IFRS 16, of EUR299 million.



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DELACHAUX GROUP: Moody's Affirms B2 CFR & Alters Outlook to Stable
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Moody's Investors Service has affirmed the B2 long term corporate
family rating and the B2-PD probability of default rating of
Delachaux Group SA ("Delachaux"). Concurrently, Moody's has
affirmed the B2 rating on the outstanding EUR840 million equivalent
guaranteed multi-currency senior secured term loan B1 and B2
maturing 2026 and the EUR75 million guaranteed senior secured
revolving credit facility (RCF) maturing 2025. The outlook was
changed to stable from negative.

RATINGS RATIONALE

The change in outlook to stable from negative reflects the good
operating performance achieved by Delachaux over 2021 with sales
expected to be up by around 12% compared to 2020 and only 2.5%
below 2019 levels. The performance has been positive in all
segments, with the strongest sales growth in Energy & Data
Management Systems (EDMS). Despite inflationary pressures, the
company's year-to-date November 2021 adjusted EBITDA margin
remained largely in line with the same period in 2020. The higher
raw material prices and transport costs were offset by scale
effect, good cost control and pass-through of price increases onto
customers. As a result, Moody's adjusted leverage is expected to
decline to around 7.0x in 2021 from 8.4x in 2020.

Moody's expects the positive sales momentum to continue in 2022,
supported by the healthy backlog and ongoing demand recovery of its
end-markets. The strong increase in chromium prices should further
support growth. Moody's assumes sales to grow in the high single
digits in percentage terms for 2022. While headwinds from cost
inflation and supply chain disruptions will likely persist, Moody's
believes that the company will be able to limit the impact on its
profitability, as demonstrated by its long track record of
relatively stable margins. Based on these assumptions, Moody's
adjusted leverage will likely decline to below 6.5x over the next
12-18 months.

The rating affirmation further reflects the company's dominant
positions within niches of the global rail infrastructure and rail
signaling markets, complemented by strong positions in EDMS and
Chromium businesses; good geographical and segmental
diversification; strong margins and low capex requirements, which
have supported consistent positive FCF even through cyclical
downturns; and relatively balanced financial policy.

The rating continues to be constrained by Delachaux's high
leverage; exposure to cyclical end-markets and competitive pressure
from emerging markets; and exposure to raw material price
volatility and translation impact from foreign-exchange rate
fluctuations.

LIQUIDITY

The liquidity profile is good with EUR116 million of cash on
balance sheet as of end November 2021 and a fully undrawn RCF of
EUR75 million. The latter has one springing net leverage covenant
tested when the RCF is drawn by more than 40% with ample headroom.
The company also has access to non-recourse factoring lines. For
2021, free cash flow (FCF) will likely be limited due to higher
working capital consumptions to support the increase in commercial
activities as well as build-up of higher inventory levels to
mitigate some of the supply chain disruptions. Over the next 12-18
months, however, Moody's expects FCF to increase to EUR30 million -
EUR40 million as working capital needs normalise. There are no
near-term debt maturities with the RCF and the term loans expiring
in 2025 and 2026, respectively.

STRUCTURAL CONSIDERATIONS

Delachaux's capital structure consists of EUR840 million equivalent
senior secured term loans and EUR75 million equivalent RCF, both
ranking pari passu in terms of priority of claims, share the same
security and guaranteed by entities accounting for at least 80% of
consolidated EBITDA. The senior secured facilities are rated in
line with the corporate family rating at B2, as Moody's does not
differentiate priority of claims in this capital structure. The
B2-PD is at the same level as the CFR, reflecting the use of a
standard recovery rate of 50%, which reflects a capital structure
with first lien bank loans and the covenant lite nature of the loan
documentation.

RATING OUTLOOK

The stable outlook reflects Moody's expectation that Moody's
adjusted leverage will decline to below 6.5x over the next 12-18
months supported by sales growth in the high-single digits and
broadly stable margins. The outlook also assumes that the company
will continue to maintain a balanced financial policy with no major
debt-funded acquisitions and will maintain a good liquidity
profile, supported by continued positive FCF.

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

Upward rating pressure could materialise if Moody's-adjusted gross
debt/EBITDA declines to below 5.5x on a sustainable basis; Moody's
adjusted FCF/debt increases to the mid-single digit range; and
Moody's adjusted EBITA margins increase to above 12% on a
sustainable basis.

Negative rating pressure could occur if Moody's-adjusted gross
debt/EBITDA is sustained at above 6.5x; negative FCF would result
in a material weakening of its liquidity profile; and Moody's
adjusted EBITA margins were sustained at below 10%.

PRINCIPAL METHODOLOGY

The principal methodology used in these ratings was Manufacturing
published in September 2021.

COMPANY PROFILE

Headquartered in Colombes, France, Delachaux is a manufacturer of
critical equipment and systems for the rail infrastructure
industry. Its core activity is complemented by its EDMS, chromium
metal and rail signalling businesses. In 2020, Delachaux generated
EUR840 million of revenue and EUR124 million of management-adjusted
EBITDA.

The company is majority owned by Ande Investissements, which
belongs to the Delachaux family, and Caisse de Depot et Placement
du Quebec (CDPQ).


ETHYPHARM SAS: S&P Lowers ICR to 'B-', Outlook Stable
-----------------------------------------------------
S&P Global Ratings lowered its issuer credit rating on Ethypharm's
parent Financiere Verdi I SAS to 'B-' from 'B'. S&P also lowered
its issue rating on the first-lien debt instrument to 'B-' from
'B'.

S&P said, "The stable outlook reflects our view that the company's
operating performance will remain stable in 2021-2022, supporting
debt leverage at around 7.5x and adequate liquidity in the next
12-18 months.

On Sept. 30, 2021, French pharmaceutical company Ethypharm
announced its acquisition of Altan, a Spain-based company
specialized in injectable medicines for hospital use. Ethypharm
funded the deal by drawing on its revolving credit facility (RCF)
alongside use of cash and new equity.

"We forecast Ethypharm's adjusted debt to EBITDA at above 7x in
2021-2022 due to lower-than-anticipated volumes and lower
absorption of fixed costs, reflecting persisting headwinds from the
pandemic as well as a change in the regulatory environment for its
Baclocur product."

Ethypharm's performance has significantly worsened year-to-date due
to lower purchase orders stemming from postponed elective surgeries
in hospitals, as well as the overstocking of some customers in the
previous year, which are now rationalizing their stocks leading to
lower-than-anticipated order volumes. At the same time, the group
faced heightened competition for some of its products, mainly
Baclocur (the drug Baclofene) from generics competitors, caused by
an unanticipated change in the regulatory landscape. S&P said,
"Therefore, we now anticipate net sales for 2021 at EUR340
million-EUR345 million and S&P Global Ratings-adjusted EBITDA
reaching around EUR76 million in 2021, compared with about EUR94
million-EUR98 million in our previous base-case scenario. We assume
that adjusted EBITDA will improve to EUR85 million-EUR87 million in
2022, mainly reflecting the positive impact from the acquisition of
Altan. We anticipate that Ethypharm's stand-alone performance
should remain relatively stable year-on-year, still impacted by
staff shortages in hospitals and continued structural decline in
its better-selling drugs such as Esomeprazole. These will be
partially offset by improved performance in its high-margin direct
sales performance and the resumption of orders with Ethypharm's
partners. Therefore, we now forecast adjusted debt to EBITDA of
about 7.5x in 2021 and 2022. We assume a stronger rebound of
performance in 2023, with leverage improving to around 7.0x as
conditions normalize and the group yields the benefit from its
pipeline in medical cannabis and digital therapeutics, as well as
from its ongoing transition to a direct sales model. That said, we
assume some volatility around our base case due to the uncertainty
of the timing of the recovery for elective surgeries, as hospital
capacity could remain constrained by staff shortages. We treat the
convertible bonds as equity as per our criteria."

The acquisition of Altan should slightly enhance Ethypharm's
product portfolio in injectables but increases exposure to
hospitals demand. Based in Spain, Altan is a specialty
pharmaceutical company that develops, manufactures, and markets
injectable medicines for hospital use, with revenues of about EUR41
million in 2020. It has a direct sales presence in Spain, but also
covers other markets as South Africa, Latin America, and Asia
through distribution partners. It has two manufacturing sites in
Spain dedicated to manufacturing own specialties in addition to
third-party manufacturing such as sterile medicines, freeze-dried
vials, and liquid ampoules. Ethypharm will benefit from a
complementary portfolio of hospital injectables, which will
strengthen its position in injectables, which should reach around
24% of revenues in 2022. This acquisition should also enable the
company to access new opportunities for licensing deals in Spain
and reach a wider coverage of European geographies. There is some
potential for cross-selling at Altan, coupled with some synergies
stemming from reinternalization plans of some functions (for
instance on distribution).

S&P said, "We assume the group will continue to post positive free
operating cash flow (FOCF) over the forecast horizon. Ethypharm
will continue to generate positive FOCF of around EUR20 million in
2021 and 2022, supported by lower manufacturing capex needs as well
as improved cash collection and close inventory monitoring, which
is a supporting factor for the rating. We consider that, to offset
the structural decline and competitive pressure the group faces on
its largest drugs and foster organic growth in the next few years,
it will be essential for the group to invest in research and
development (R&D) to develop new pipeline opportunities. We
understand the group will continue to invest in in-licensing deals
capturing external R&D, coupled with a pipeline of drug launches,
notably in medical cannabis and digital therapies." Ethypharm is
also engaging in internationalization projects such as product
launches in the Middle East and Africa, which are higher-margin due
to the favorable regulation in those countries.

S&P Global Ratings believes the omicron variant is a stark reminder
that the COVID-19 pandemic is far from over. Uncertainty still
surrounds its transmissibility, severity, and the effectiveness of
existing vaccines against it. Early evidence points toward faster
transmissibility, which has led many countries to reimpose social
distancing measures and international travel restrictions. S&P
said, "Over coming weeks, we expect additional evidence and testing
will show the extent of the danger it poses to enable us to make a
more informed assessment of the risks to credit. In our view, the
emergence of the omicron variant shows once again that more
coordinated and decisive efforts are needed to vaccinate the
world's population to prevent the emergence of new, more dangerous
variants."

S&P said, "The stable outlook on Ethypharm reflects our view that
the group will maintain its financial performance and positive free
cash flow generation over the next 12-18 months, in line with our
updated base case.

"Our base case assumes that the group's EBITDA margin should remain
around 22%, with FFO cash interest coverage above 2.0x, and that
the group will generate positive FOCF at close to 2.5% FOCF to
debt. This would enable Ethypharm to comfortably service debt while
partially self-funding its capital investment needs and covering
its licensing and brand acquisitions.

"We could lower the ratings either if we see increasing risk of an
unsustainable capital structure because of a high debt burden or
because of pressure on liquidity. The most likely cause would be
unexpected operational setbacks leading to a material deterioration
in profitability and cash flow, preventing leverage reduction, or
because of large debt-financed acquisitions pushing leverage toward
historical highs."

Operating setbacks could materialize from a continued decline in
volumes, slower ramp-up of product pipeline launches, the
unsuccessful integration of new acquisitions, or an increased cost
base due to higher supply chain or marketing costs, causing the
EBITDA margin to fall drastically below our base case.

S&P said, "We could take a positive rating action if adjusted
EBITDA and FFO cash interest coverage increase significantly higher
than our assumptions, with EBITDA margins improving faster than
expected, leading to a reduction of adjusted debt leverage
comfortably within 6x-7x with strong positive FOCF. This could
occur from stronger-than-expected volumes due to products
performing better in main markets, direct sales ramp-up capturing
more margins, a stronger product pipeline through in-licensing, or
solid recovery of the U.K. market."




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CHEPLAPHARM ARZNEIMITTEL: Fitch Puts 'B+' LT IDR on Watch Positive
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Fitch Ratings has placed Cheplapharm Arzneimittel GmbH
(Cheplapharm) 'B+' Long-Term Issuer Default Rating (IDR) and 'BB-'
senior secured debt rating on Rating Watch Positive (RWP).

The RWP follows the company's IPO announcement, which once
completed should result in a permanent enhancement of Cheplapharm's
financial risk profile based on the company's commitment to a more
conservative financial policy, with net debt/EBITDA of 3.0x
translating into funds from operations (FFO) leverage of around
4.0x from 2022 (compared with 5.5x at the end of 2021).
Operationally, Fitch projects Cheplapharm will continue generating
healthy EBITDA and free cash flow (FCF) margins, supported by its
proven ability to manage its existing portfolio and execute M&A
strategy to replenish declining organic earnings.

Post-IPO, Fitch intends to resolve the RWP by assigning a Positive
Outlook or upgrading the IDR by a maximum one notch to 'BB-'. This
is subject to the application of the IPO proceeds, final debt
structure and Fitch's assessment of the pace of deleveraging.

KEY RATING DRIVERS

Commitment to Conservative Financial Policy: The RWP is driven by
Cheplapharm's public commitment to a more conservative financial
policy following the IPO, with target net debt/EBITDA of 3.0x.
Together with continuously high and resilient EBITDA margins of 50%
and FCF margins of 25%-28%, this could support a one-notch upgrade
to 'BB-' on completion of the IPO as planned. Based on the expected
outcome of the IPO and the final capital structure, Fitch projects
FFO adjusted leverage to improve to around 4.0x in 2022 from 5.5.x
in 2021.

Execution Drives Deleveraging: Without any envisaged permanent debt
reduction following the IPO, near-term deleveraging is expected to
come from the application of estimated net listing proceeds of
EUR700 million towards repayment of the revolving credit facility
(RCF) of up to EUR400 million and funding of signed acquisitions
expected to close in 1H22 of around EUR300 million. Outside the
one-time use of equity proceeds, any deleveraging would be reliant
on strong business execution, especially the continuation of
disciplined implementation of the M&A strategy.

Fitch's assumption is based on the company's continued adherence to
its disciplined investment criteria, which will be critical to
sales, EBITDA and cash flow growth supporting credit improvement.
Fitch views positively the company's record of selecting and
integrating credit-accretive drug IP acquisitions in the past four
years, as evidenced by sustained healthy EBITDA and FCF margins. At
the same time, Fitch also stresses the critical importance of its
organic portfolio performance, as Cheplapharm manages decline of
late-stage drugs against its M&A and financial policy frameworks.

More Predictable M&A, Less Event Risks: Cheplapharm's tightened M&A
target of EUR600 million per year to match the available funding
from expected FCF and the RCF, reduces event and execution risks,
and supports a steadier leverage profile. These factors lead to
increased predictability of Cheplapharm's credit quality,
supporting a potential upgrade post-IPO.

Defensive Maturing Operations: The ratings are underpinned by
Cheplapharm's defensive business profile, characterised by
well-executed acquisitions of drug IP rights and active product
lifecycle management. Fitch views positively Cheplapharm's focus on
branded generics with long-established legacy drugs and niche
products with limited exposure to competition. With 2021 sales
expected to exceed EUR1 billion, the business gained scale and
diversification as well as maturity, having become an established
drug IP management platform.

The company's size remains small in the global pharmaceutical
sector context, and based on the targeted M&A pace, Fitch projects
gradually decelerating revenue growth to high single-digits by
2024. Nevertheless, Cheplapharm has reached a critical size no
longer constraining it from entering the 'BB' rating category in
the near term, provided that management maintains conservative
financial discipline.

IPO Implications for Existing Debt: The IPO constitutes a change of
control (CoC) under the senior facilities agreement, which would
trigger a mandatory prepayment of the term loan B (TLB) and RCF.
Cheplapharm has arranged for a backstop facility of up to EUR980
million to refinance any amounts to be prepaid under the TLB. The
RCF will also have to be prepaid following the CoC, with
Cheplapharm intending to use the IPO proceeds. In parallel, the
company is planning to refinance the TLB and RCF by simultaneously
increasing the RCF by EUR110 million to EUR560 million, with
RCF/TLB maturities to be reset to six/seven years starting 2022.

Under the senior secured notes indenture, the IPO will not trigger
a CoC, as any incoming shareholders will not own collectively more
than 30% of the voting rights.

Supportive Market Fundamentals: Cheplapharm benefits from the
continuing strong supply of off-patent drugs to the market as
innovative pharma companies are looking to streamline their product
portfolios to concentrate on core therapies and implement their
capital allocation strategies. Fitch regards niche specialist
pharmaceutical companies such as Cheplapharm as being
well-positioned to continue capitalising on these positive sector
macro-economic and sector trends.

DERIVATION SUMMARY

Fitch rates Cheplapharm applying Fitch's Ratings Navigator
framework for pharmaceutical companies. The IDR reflects
Cheplapharm's defensive business profile with resilient and
predictable earnings, as well as high operating margins and strong
cash flow generation due to the company's asset-light business
model.

Cheplapharm is rated at the same level as Pharmanovia Bidco Limited
(B+/Negative), although Pharmanovia has shown uneven operating
performance and increased execution risks around its acquisition
strategy and organic portfolio management.

Fitch sees Cheplapharm's credit profile as stronger than that of
the specialist pharmaceutical company IWH UK Finco Ltd (B/Stable),
warranting a one-notch difference. The rating differential reflects
the former's higher operating and cash flow margins, in combination
with a more conservative financial profile reflected in FFO
leverage of 5.5x in 2021, projected to decline towards 4.0x,
against IWH's 5.5x-6.0x.

Fitch also regards Cheplapharm as stronger than generics producer
Nidda BondCo GmbH (B/Stable), despite its much smaller scale and
more concentrated portfolio, which is mitigated by wide geographic
diversification within each brand. Nidda BondCo's rating is
burdened by high leverage, with a spike in expected FFO adjusted
gross leverage to 9.0x-10.0x in 2021-2022 following the recent
operating underperformance amidst the pandemic and the impact of
debt-funded acquisitions.

KEY ASSUMPTIONS

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

-- Sales growth of around 55% in FY21, decelerating to around 8%
    by FY24;

-- EBITDA margin stable at 50%-51%;

-- Capex at around 1% of sales each year;

-- Change in trade working capital outflow of EUR100 million a
    year through to FY24;

-- M&A of EUR1.2 billion in 2021-2022, EUR600 million thereafter
    at an EV/sales multiple of 2.5x (EV/EBITDA of 5.0x). M&A will
    be funded through FCF generation, drawdowns of the RCF and
    from planned IPO proceeds in 2022;

-- Dividends at 30% of prior year's net income starting in FY23,
    followed by a 50% payout ratio thereafter.

Recovery Assumptions:

In a distressed scenario, Fitch expects Cheplapharm would most
likely be sold or restructured as a going concern (GC) rather than
liquidated given its asset-light business model.

Fitch estimates a post-restructuring GC EBITDA at about EUR400
million, which includes the contribution from the recently signed
but not yet closed drug IP acquisitions scheduled for completion in
1Q-2Q22. Cheplapharm would be required to address debt service and
fund working capital as the company takes over inventories
following transfer of market authorisation rights, as well as to
make smaller M&A to sustain its product portfolio to compensate for
a natural sales decline.

Fitch applies a distressed enterprise value/EBITDA multiple of 5.5x
(unchanged), reflecting the underlying value of the company's
portfolio of IP rights.

After deducting 10% for administrative claims, Fitch's principal
waterfall analysis generated a ranked recovery in the 'RR3' band
for the first-lien senior secured facilities, indicating a 'BB-'
instrument rating. The waterfall analysis output percentage on
current metrics and assumptions is 68% (previously 60%). The
increase in the estimated recovery reflects the impact of the
latest acquisitions on an unchanged debt structure.

RATING SENSITIVITIES

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

-- An upgrade to the 'BB' rating category would require a
    maturing of Cheplapharm's business risk profile, characterized
    by a sustained improvement of business scale with sales above
    EUR1 billion in combination with a more diversified product
    portfolio, resilient operating and strong FCF margins, and
    reducing execution risks, in combination with

-- Conservative leverage policy with total debt/operating EBITDA
    at or below 4.0x, or FFO gross leverage at about 4.0x.

Factor that could, individually or collectively, lead to negative
rating action/downgrade (removal from RWP and Stable Outlook):

-- Abandoning the IPO with total debt/operating EBITDA remaining
    at 5.0x, or FFO gross leverage at around 5.0x-5.5x.

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

-- Unsuccessful management of individual pharmaceutical IP rights
    leading to material permanent loss of income and EBITDA
    margins declining towards 40%;

-- Positive but continuously declining FCF; and

-- More aggressive financial policy with total debt/operating
    EBITDA sustainably above 5.5x, or FFO gross leverage above
    6.0x (net of readily available cash: 5.5x).

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

Comfortable Liquidity: Fitch views liquidity as comfortable, based
on Cheplapharm's strong pre-M&A FCF of EUR350 million to EUR400
million per year until 2024. If the planned TLB/RCF refinancing
triggered by the IPO goes ahead according to plan, Fitch expects a
near-term restoration of the full RCF availability of EUR450
million, which together with the sizeable internally generated cash
flows, will be sufficient to grow its earnings base through M&A as
its organic portfolio declines.

Cheplapharm benefits from a long-dated TLB and senior secured note
maturities spread between July 2025 and January 2028. A potential
refinancing of the senior secured facilities would further extend
the term loan maturities.

In Fitch's assessment of freely available cash, Fitch deducts EUR20
million of minimum liquidity required for operations.

ISSUER PROFILE

Cheplapharm is engaged in acquisition and management of off-patent
branded legacy and niche drugs.

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.


CHEPLAPHARM ARZNEIMITTEL: S&P Puts 'B' LT ICR on Watch Positive
---------------------------------------------------------------
S&P Global Ratings placed its 'B' long-term rating on
Germany-headquartered specialty pharmaceutical company Cheplapharm
Arzneimittel GmbH (Cheplapharm) on CreditWatch with positive
implications.

S&P expects to resolve the CreditWatch in the next three months,
once the transaction completes and S&P has re-evaluated the
company's business prospects and financial policy.

The CreditWatch placement follows the announcement of the planned
listing of Cheplapharm. On Jan. 17, 2022, Cheplapharm announced its
intention to list itself on the Frankfurt Stock Exchange. The
company expects to raise approximately EUR750 million in primary
proceeds, which it will use to pay down existing debt, fund
acquisition opportunities, and pay associated fees. S&P said,
"Assuming a successful placement, we estimate this could result in
an S&P Global Ratings-adjusted debt-to-EBITDA ratio materially
improving, from about 4.4x-4.5x we forecast for 2021, which could
support a higher rating. The company has stated its intention to
reduce its debt to EBITDA to the 3.0x-3.25x range, compared with
3.93x as reported by the company in September 2021. We forecast
Cheplapharm will continue generating high levels of annual free
operating cash flow (FOCF), supported by its asset-light business
model and the absence of in-house research and development
activity. Additionally, we factor into our rating the company's
ambition to maintain an unchanged acquisition policy to acquire
branded prescription medicine with long past patent expiry or niche
products with limited competition at a reasonable price that
supports a return on investment within 5.5 years or less. We also
factor in the company's plan to pay a dividend of up to 50% of net
earnings from 2023."

S&P said, "We expect to resolve the CreditWatch in the next three
months once the transaction completes and we evaluate the impact of
the listing and financial policy on Cheplapharm's credit metrics.
We think that a successful listing could materially improve its S&P
Global Ratings-adjusted debt to EBITDA ratio which could support a
higher rating. We forecast the company to continue applying a
combination of self-generated FOCF and new debt toward new product
acquisition, which could drive volatility in credit metrics
depending on the timing of acquisitions."




===========
G R E E C E
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NAVIOS MARITIME: Moody's Ups CFR to B3 & Alters Outlook to Stable
-----------------------------------------------------------------
Moody's Investors Services has upgraded Navios Maritime Holdings,
Inc.'s (Navios Holdings, NM) long-term corporate family rating to
B3 from Caa1 and probability of default rating to B3-PD from
Caa1-PD. Concurrently, Moody's has also upgraded the remaining
outstanding 11.25% senior secured notes due in August 2022 (11.25%
notes) to Caa1 from Caa2. Moody's changed the outlook to stable
from negative.

Moody's has further affirmed Navios South American Logistics Inc.'s
(Navios South American Logistics, NSAL) CFR of B3, PDR of B3-PD and
the B3 of the $500 million guaranteed senior secured notes due 2025
co-issued by Navios South American Logistics Inc. and its
subsidiary Navios Logistics Finance (US) Inc. Moody's changed the
outlook to stable from negative.

RATINGS RATIONALE

The rating actions on Navios Holdings reflect Navios Holdings'
successful refinancing of the 7.375% notes and significant
reduction of the 11.25% notes during 2021 and early 2022, thereby
significantly improving its debt maturity profile and overall debt
levels. Moreover, the rating actions on Navios Holdings reflect the
currently solid market conditions in the dry bulk shipping market
resulting in significantly higher profitability and improved credit
metrics.

Navios Holdings has repaid the significant January 2022 maturity
for the 7.375% notes through a mix of new bank facilities including
sale and leasebacks, increased loans from N Shipmanagement
Acquisition Corp, a company affiliated with Navios Holdings
Chairwoman and CEO Angeliki Frangou, and cash. This will
substantially improve Navios Holdings' debt maturity profile
although still leaving $105 million of near-term debt represented
by the 11.25% notes due in August 2022.

Navios Holdings has also reduced its Moody's-adjusted debt level to
$1.6 billion as of September 2021, down from $1.9 billion at the
end of 2020, mainly through a partial redemption of the 11.25%
notes and aided by vessels sales (some of which to related Navios
company Navios Maritime Partners L.P. rated B2 stable in which
Navios Holdings has a 10.3% stake), and debt could further reduce
in 2022. Moreover, the high charter rates in 2021 have resulted in
Navios Holdings' Moody's-adjusted debt/EBITA reducing to 4.2x as of
September 2021 (including equity-accounted income), down from 8.6x
at the end of 2020, and Moody's expects leverage to remain below
5.0x if current market conditions persist.

However, the rating actions on Navios Holdings also continue to
balance the company's continued significant exposure to spot
charter rates and hence market volatility, which recognizes that
leverage may remain volatile and could be materially higher during
weaker market conditions. In addition, Navios Holdings has shrunk
its fleet meaningfully during 2020 and 2021 with its total managed
fleet reducing to 36 vessels as of December 10, 2021, down from 53
at the end of 2019.

The rating actions on Navios South American Logistics primarily
reflect the reduced refinancing risks and improved capital
structure and credit quality of its parent Navios Holdings, which
owns 63.8% of Navios South American Logistics. Profitability and
credit metrics for Navios South American Logistics remained under
pressure during 2021 due to low river water levels, reducing
navigability, goods moved and increasing cost, as well as lower
cabotage earnings as a result of pandemic-related weaker regional
demand. Nevertheless, credit metrics are likely to remain
comfortably within the range for the B3 rating with some potential
for improvement in 2022 depending on operating conditions and some
growth opportunities.

Moody's views the liquidity profile for Navios Holdings as weak
notwithstanding the successful large refinancing, primarily because
Navios Holdings continues to have the remaining $105 million of
11.25% notes due in August 2022 alongside ca. $47 million of lease
and loan payments during 2022 pro-forma for the refinancing. The
2022 maturities could be addressed through cash flow generation,
but this will depend on market conditions. If charter rates were to
reduce substantially, the company may have to raise additional
funding which it has done historically through additional debt or
vessel sales.

Moody's views Navios South American Logistics' liquidity profile as
adequate reflecting $32.7 million of short-term maturities, $31.7
million of cash as of September 2021 and Moody's expectation of
free cash flow generation in 2022.

RATING OUTLOOK

The stable outlook for Navios Holdings reflects the currently good
market conditions and Moody's expectation that metrics such as
leverage should remain within the expectation for the B3 rating in
2022.

The stable outlook for Navios South American Logistics reflects
Moody's expectation of at least steady and potentially improving
leverage in 2022 together with positive free cash flow generation.

ESG CONSIDERATIONS

The ratings continue to incorporate a range of ESG considerations,
including environmental considerations such as the uncertainty from
sector and regulatory efforts to reduce fleet emissions as well as
river navigability issues in the case of Navios South American
Logistics. Furthermore, the ratings consider the significant
complexity of the Navios group of companies, including shared
management and related party transactions. While the complexity has
reduced in the last year with the merger of three Navios entities,
this remains a negative.

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

While positive pressure remains constrained by the high exposure to
market volatility, positive pressure could occur if Navios
Holdings' Moody's-adjusted debt/ EBITDA remains sustainably at
least around 5.0x and Moody's-adjusted (funds from operations +
interest expense)/ interest expense above 2.0x, including during
periods of weaker charter rates, while generating positive free
cash flow and maintaining an at least adequate liquidity and debt
maturity profile. Negative pressure could result from a downturn in
the dry bulk market or a deterioration in the financial performance
such that Navios Holdings' leverage rises above 7.0x and interest
cover falls below 1.5x. Any liquidity challenges and inability to
refinance its maturing debt would also pressure the rating.

For Navios South American Logistics, positive pressure would be
likely if NSAL achieves Moody's-adjusted debt/ EBITDA below 5.5x
and (funds from operations + interest expense)/ interest expense
above 1.75x, while maintaining an adequate liquidity and debt
maturity profile as well as a positive free cash flow. Negative
rating pressure could arise if (1) NSAL's liquidity profile weakens
materially, (2) its leverage deteriorates beyond 7.5x or its
interest cover below 1.25x, or (3) the rating of Navios Holdings is
downgraded.

PRINCIPAL METHODOLOGY

The principal methodology used in these ratings was Shipping
published in June 2021.

COMPANY PROFILE

Navios Holdings is a seaborne shipping and logistics company
focused on the transport and transshipment of dry bulk commodities,
including iron ore, coal and grain. The company controlls a fleet
of 36 vessels with focus on larger size dry bulk vessels. In
addition to its own operations, Navios Holdings owns a 63.8% stake
in the logistics company Navios South American Logistics Inc. and a
10.3% stake in the dry bulk, container and tanker shipping company
Navios Maritime Partners L.P. (Navios Partners, B2 stable). Navios
Holdings is listed on the New York Stock Exchange.

Navios South American Logistics is one of the principal logistics
companies operating in the Hidrovia region river system in South
America. NSAL's river operations provide waterborne transportation
services for liquid and dry cargoes as well as port, storage and
related services. Along with these river operations, the company is
one of the main participants in the Argentine cabotage trade. In
2020, NSAL generated revenue of $215 million and company-adjusted
EBITDA of $92 million. Navios Holdings owns 63.8% of NSAL, the
remainder being held by the Argentinean Lopez family through Peers
Business Inc.



=============
I R E L A N D
=============

ARBOUR CLO X: Fitch Assigns Final B- Rating on Class F Debt
-----------------------------------------------------------
Fitch Ratings has assigned Arbour CLO X DAC final ratings.

    DEBT                        RATING              PRIOR
    ----                        ------              -----
Arbour CLO X DAC

A XS2417697807           LT AAAsf   New Rating    AAA(EXP)sf
B1 XS2417698011          LT AAsf    New Rating    AA(EXP)sf
B2 XS2417698284          LT AAsf    New Rating    AA(EXP)sf
C XS2417698441           LT Asf     New Rating    A(EXP)sf
D XS2417698797           LT BBB-sf  New Rating    BBB-(EXP)sf
E XS2417698953           LT BB-sf   New Rating    BB-(EXP)sf
F XS2417699175           LT B-sf    New Rating    B-(EXP)sf
M XS2423367551           LT NRsf    New Rating
Sub Notes XS2417699332   LT NRsf    New Rating    NR(EXP)sf

TRANSACTION SUMMARY

Arbour CLO X DAC is a securitisation of mainly senior secured
obligations (at least 90%) with a component of senior unsecured,
mezzanine, second-lien loans and high-yield bonds. Note proceeds
were used to purchase a portfolio with a target par of EUR400
million. The portfolio is actively managed by Oaktree Capital
Management (Europe) LLP. The collateralised loan obligation (CLO)
has a four-and-a-half-year reinvestment period and an
eight-and-a-half-year weighted average life (WAL).

KEY RATING DRIVERS

Average Portfolio Credit Quality (Neutral): Fitch places the
average credit quality of obligors in the 'B'/'B-' category. The
Fitch weighted average rating factor (WARF) of the identified
portfolio is 25.0.

High Recovery Expectations (Positive): At least 90% of the
portfolio comprises senior secured obligations. Fitch views the
recovery prospects for these assets as more favourable than for
second-lien, unsecured and mezzanine assets. The Fitch weighted
average recovery rate (WARR) of the identified portfolio is 61.9%.

Diversified Asset Portfolio (Positive): The transaction has a
concentration limit for the 10 largest obligors of 20%. The
transaction also includes various concentration limits, including
the maximum exposure to the three largest (Fitch-defined)
industries in the portfolio at 40%. These covenants ensure the
asset portfolio will not be exposed to excessive concentration.

Portfolio Management (Neutral): The transaction has a 4.5-year
reinvestment period and includes reinvestment criteria similar to
those of other European transactions. Fitch's analysis is based on
a stressed-case portfolio with the aim of testing the robustness of
the transaction structure against its covenants and portfolio
guidelines.

Cash-flow Modelling (Positive): The WAL used for the transaction's
stress portfolio analysis is 12 months less than the WAL covenant
at the issue date. This reduction to the risk horizon accounts for
the strict reinvestment conditions envisaged after the reinvestment
period. These include passing both the coverage tests and the Fitch
'CCC' limit post reinvestment as well a WAL covenant that
progressively steps down over time, both before and after the end
of the reinvestment period. In Fitch's opinion, these conditions
would reduce the effective risk horizon of the portfolio during the
stress period.

RATING SENSITIVITIES

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

-- An increase of the rating default rate (RDR) at all rating
    levels by 25% of the mean RDR and a 25% decrease of the
    recovery rate at all rating levels would lead to a downgrade
    of up to five notches for the rated notes.

-- Downgrades may occur if the build-up of the notes' credit
    enhancement following amortisation does not compensate for a
    larger loss expectation than initially assumed due to
    unexpectedly high levels of defaults and portfolio
    deterioration.

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

-- A reduction of the RDR at all rating levels by 25% of the mean
    RDR and a 25% increase of the recovery rate at all rating
    levels would lead to an upgrade of up to three notches for the
    rated notes, except the class A notes, which are already at
    the highest rating on Fitch's scale and cannot be upgraded.

-- Upgrades could occur after the end of the reinvestment period
    if there were to be better-than-expected portfolio credit
    quality and deal performance, leading to higher credit
    enhancement and excess spread available to cover losses in the
    remaining portfolio.

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

Arbour CLO X DAC

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

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

Overall, and together with any assumptions referred to above,
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.


ARBOUR CLO X: Moody's Assigns B3 Rating to EUR12MM Class F Notes
----------------------------------------------------------------
Moody's Investors Service announced that it has assigned the
following definitive ratings to notes issued by Arbour CLO X
Designated Activity Company (the "Issuer"):

EUR246,000,000 Class A Senior Secured Floating Rate Notes due
2034, Assigned Aaa (sf)

EUR30,000,000 Class B-1 Senior Secured Floating Rate Notes due
2034, Assigned Aa2 (sf)

EUR10,000,000 Class B-2 Senior Secured Fixed Rate Notes due 2034,
Assigned Aa2 (sf)

EUR26,400,000 Class C Senior Secured Deferrable Floating Rate
Notes due 2034, Assigned A2 (sf)

EUR28,600,000 Class D Senior Secured Deferrable Floating Rate
Notes due 2034, Assigned Baa3 (sf)

EUR20,000,000 Class E Senior Secured Deferrable Floating Rate
Notes due 2034, Assigned Ba3 (sf)

EUR12,000,000 Class F Senior Secured Deferrable Floating Rate
Notes due 2034, Assigned B3 (sf)

RATINGS RATIONALE

The rationale for the ratings is based on a consideration of the
risks associated with the CLO's portfolio and structure as
described in Moody's methodology.

The Issuer is a managed cash flow CLO. At least 90% of the
portfolio must consist of secured senior loans or senior secured
bonds and up to 10% of the portfolio may consist of unsecured
senior obligations, second-lien loans, high yield bonds and
mezzanine obligations. The underlying portfolio is expected to be
95% ramped as of the closing date and to comprise of predominantly
corporate loans to obligors domiciled in Western Europe. The
remainder of the portfolio will be acquired during the 4.5 month
ramp-up period in compliance with the portfolio guidelines.

Oaktree Capital Management (Europe) LLP ("Oaktree") will continue
to manage the CLO. It will direct the selection, acquisition and
disposition of collateral on behalf of the Issuer and may engage in
trading activity, including discretionary trading, during the
transaction's 4.5-year reinvestment period. Thereafter, subject to
certain restrictions, purchases are permitted using principal
proceeds from unscheduled principal payments and proceeds from
sales of credit risk obligations and credit improved obligations.

In addition to the seven classes of notes rated by Moody's, the
Issuer will issue EUR250,000 Class M Notes due 2034 and
EUR30,000,000 Subordinated Notes due 2034 which are not rated.

The transaction incorporates interest and par coverage tests which,
if triggered, divert interest and principal proceeds to pay down
the notes in order of seniority.

Methodology Underlying the Rating Action:

The principal methodology used in these ratings was "Moody's Global
Approach to Rating Collateralized Loan Obligations" published in
December 2021.

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

The rated notes' performance is subject to uncertainty. The notes'
performance is sensitive to the performance of the underlying
portfolio, which in turn depends on economic and credit conditions
that may change. The collateral manager's investment decisions and
management of the transaction will also affect the notes'
performance.

Moody's modeled the transaction using a cash flow model based on
the Binomial Expansion Technique, as described in Section 2.3 of
the "Moody's Global Approach to Rating Collateralized Loan
Obligations" rating methodology published in December 2021.

Moody's used the following base-case modeling assumptions:

Par Amount: EUR400,000,000

Diversity Score: 55

Weighted Average Rating Factor (WARF): 3085

Weighted Average Spread (WAS): 3.60%

Weighted Average Coupon (WAC): 4.00%

Weighted Average Recovery Rate (WARR): 43.5%

Weighted Average Life (WAL): 7.5 years


FINANCE IRELAND 4: S&P Assigns Prelim. B-(sf) Rating on X Notes
---------------------------------------------------------------
S&P Global Ratings assigned preliminary credit ratings to Finance
Ireland RMBS No. 4 DAC's class A, class B-Dfrd to F-Dfrd, and class
X-Dfrd notes. At closing, the issuer will also issue unrated class
Y, Z, R1, and R2 notes.

Finance Ireland RMBS No. 4 is a static RMBS transaction that
securitizes a portfolio of EUR339.29 million owner-occupied
mortgage loans secured on properties in Ireland.

This transaction is very similar to its predecessor, Finance
Ireland RMBS No. 3.

The loans in the pool were originated between 2016 and 2021 by
Finance Ireland Credit Solutions DAC and Pepper Finance Corp. DAC.
Finance Ireland is a nonbank specialist lender, which purchased the
Pepper Finance Residential Mortgage business in 2018.

The collateral comprises prime borrowers, and there is a high
exposure first-time buyers. All the loans have been originated
relatively recently and thus under the Irish Central Bank's
mortgage lending rules limiting leverage and affordability.

The transaction benefits from liquidity provided by a general
reserve fund, and in the case of the class A notes, a class A
liquidity reserve fund.

Principal can be used to pay senior fees and interest on the notes
subject to various conditions.

Credit enhancement for the rated notes will consist of
subordination and the general reserve fund from the closing date.
The class A liquidity reserve can also ultimately provide
additional enhancement subject to certain conditions.

The transaction incorporates a swap to hedge the mismatch between
the notes, which pay a coupon based on the three-month EURIBOR, and
the loans, which pay fixed-rate interest before reversion.

At closing, the issuer will use the issuance proceeds to purchase
the full beneficial interest in the mortgage loans from the seller.
The issuer grants security over all its assets in favor of the
security trustee.

There are no rating constraints in the transaction under our
counterparty, operational risk, or structured finance sovereign
risk criteria. We consider the issuer to be bankruptcy remote.

  Preliminary Ratings

  CLASS   PRELIM. RATING   CLASS SIZE (EUR)
  A           AAA (sf)       283,310,000
  Y           NR                   5,000
  B-Dfrd      AA (sf)         21,200,000
  C-Dfrd      A (sf)          11,020,000
  D-Dfrd      BBB (sf)        10,170,000
  E-Dfrd      BB+ (sf)         5,930,000
  F-Dfrd      BB (sf)          3,390,000
  Z           NR               4,274,000
  X-Dfrd      B- (sf)          7,600,000
  R1          NR                  10,000
  R2          NR                  10,000

  NR--Not rated.


MADISON PARK XI: Fitch Raises Class E Notes Rating to 'BB+'
-----------------------------------------------------------
Fitch Ratings has upgraded Madison Park Euro Funding XI DAC's class
B-1 to E notes, removed the class B-1 to F notes from Under
Criteria Observation (UCO) and affirmed the class A and F notes.
The Outlooks on the class B-1 to F notes are Positive.

      DEBT              RATING            PRIOR
      ----              ------            -----
Madison Park Euro Funding XI DAC

A-1 XS1833623306   LT AAAsf   Affirmed    AAAsf
A-2 XS1833623561   LT AAAsf   Affirmed    AAAsf
B-1 XS1833624379   LT AA+sf   Upgrade     AAsf
B-2 XS1833624965   LT AA+sf   Upgrade     AAsf
C XS1833625426     LT A+sf    Upgrade     Asf
D XS1833626150     LT BBB+sf  Upgrade     BBBsf
E XS1833626747     LT BB+sf   Upgrade     BB-sf
F XS1833627471     LT B-sf    Affirmed    B-sf

TRANSACTION SUMMARY

Madison Park Euro Funding XI DAC is a cash flow CLO mostly
comprising senior secured obligations. The transaction is actively
managed by Credit Suisse Asset Management and will exit its
reinvestment period in August 2022.

KEY RATING DRIVERS

CLO Criteria Update and Cash Flow Modelling: The rating actions
mainly reflect the impact of Fitch's recently updated CLOs and
Corporate CDOs Rating Criteria and the shorter risk horizon
incorporated in Fitch's updated stressed portfolio analysis. The
analysis considered modelling results for the current and stressed
portfolios based on the 2 November 2021 trustee report.

The rating actions are in line with the model-implied ratings from
Fitch's updated stressed portfolio analysis, which applied the
agency's collateral quality matrix specified in the transaction
documentation. The transaction has two Fitch collateral quality
matrices, with a top 10 obligor concentration of 20% and fixed-rate
obligation limits of 0% and 12.5%.

Fitch applied a haircut of 1.5% to the weighted average recovery
rate (WARR) as the calculation in the transaction documentation
reflects an earlier version of Fitch's CLO criteria.

The Stable Outlook on the class A notes reflects Fitch's
expectation that they have sufficient credit protection to
withstand potential deterioration in the credit quality of the
portfolio in stress scenarios commensurate with the rating. The
Positive Outlooks on the class B-1 through F notes reflect that the
transaction will exit its reinvestment period within a year and is
expected to begin deleveraging thereafter.

Stable Asset Performance: The transaction's metrics indicate stable
asset performance. As of the 2 November 2021 trustee report, the
aggregate portfolio amount when adjusted for trustee-reported
recoveries on defaulted assets, was 1.66% under the original target
par amount. Collateral quality tests, coverage tests and portfolio
profile tests are all in compliance. Fitch calculates the exposure
to assets with a Fitch-derived rating of 'CCC+' and below
(excluding non-rated assets) is 4.76%.

B'/'B-' Portfolio: Fitch assesses the average credit quality of the
transaction's underlying obligors at the 'B'/'B-' level. The
weighted average rating factor (WARF) as calculated by the trustee
was 34.12, which is below the maximum covenant of 35.00. Fitch
calculates the WARF as 25.10 under the updated criteria.

High Recovery Expectations: Senior secured obligations comprise
98.7% of the portfolio. Fitch views the recovery prospects for
these assets as more favourable than for second-lien, unsecured and
mezzanine assets.

Diversified Portfolio: The portfolio is well-diversified across
obligors, countries and industries. The top 10 obligor
concentration is 10.90% and no obligor represents more than 1.18%
of the portfolio balance as calculated by Fitch.

RATING SENSITIVITIES

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

-- An increase of the default rate (RDR) at all rating levels by
    25% of the mean RDR and a decrease of the recovery rate (RRR)
    by 25% at all rating levels in the stressed portfolio would
    result in downgrades of up to five notches, depending on the
    notes.

-- Downgrades may occur if the build-up of the notes' credit
    enhancement (CE) following amortisation does not compensate
    for a larger loss expectation than initially assumed, due to
    unexpectedly high levels of defaults and portfolio
    deterioration.

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

-- A reduction of the RDR at all rating levels by 25% of the mean
    RDR and an increase in the RRR by 25% at all rating levels in
    the stressed portfolio would result in upgrades of up to five
    notches, depending on the notes.

-- Except for the tranches already at the highest 'AAAsf' rating,
    upgrades may occur in case of better-than-expected portfolio
    credit quality and deal performance, and continued
    amortisation that leads to higher CE and excess spread
    available to cover losses in the remaining portfolio.

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

Madison Park Euro Funding XI DAC

Fitch has checked the consistency and plausibility of the
information it has received about the performance of the asset pool
and the transaction. 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.

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

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

Overall, and together with any assumptions referred to above,
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.


[*] IRELAND: RAI Calls for Tax Amnesty for Hospitality Firms
------------------------------------------------------------
Sarah Collins at the Irish Independent reports that the Restaurants
Association of Ireland (RAI) is calling for a tax amnesty for
hospitality firms to help them survive beyond the expected lifting
of restrictions next month.

It comes after insolvency experts predicted that more than 1,000
firms could close their doors from next year, once government
supports end and pandemic debts are called in, the Irish
Independent notes.  Retailers and business organisations say small,
domestic, independent firms will be worst hit, the Irish
Independent states.

According to the Irish Independent, Adrian Cummins, the head of the
RAI, said hospitality firms are "viable" but may not remain so if
they are forced to pay back billions of euros in deferred tax debts
this year.

"We're in an artificial economy now," Mr. Cummins told the Irish
Independent.

"The business supports are sustaining businesses from closing down,
but when those supports are wound down, the sector will come under
extreme pressure."

More than 98,000 firms had deferred or 'warehoused' tax debts worth
EUR2.9 billion as of the end of December 2021, the Irish
Independent relays, citing figures published by the Revenue
Commissioner on Jan. 13.

The bulk of that is PAYE and Vat debts, which were worth around
EUR1.4 billion each at the end of last year, the Irish Independent
discloses.

Mr. Cummins, as cited by the Irish Independent, said the Government
should offer hospitality firms a write-down or amnesty on the debt
because "a lot of businesses will not be able to pay that tax
back".

He is also calling on the Government to extend the employment wage
subsidy scheme beyond April, or at least maintain the current rate
of support for firms, the Irish Independent notes.

The scheme is being gradually wound down, with lower levels of
support applying from next month, the Irish Independent says.

Research by audit firm Deloitte showed business closures actually
fell by a third last year, indicating that companies are hooked on
Covid supports and may be delaying insolvency decisions, the Irish
Independent discloses.

According to the Irish Independent, EU officials have suggested
Covid supports for hard-hit sectors including retail, entertainment
and tourism could be extended to avoid future bankruptcies.




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

WEBUILD SPA: Fitch Gives 'BB(EXP)' Rating on New EUR500MM Notes
---------------------------------------------------------------
Fitch Ratings has assigned Webuild S.p.A.'s planned maximum EUR500
million five-year notes an expected senior unsecured rating of
'BB(EXP)'. The rating is aligned with Webuild's Long-Term Issuer
Default Rating (IDR) and existing senior unsecured notes' rating.
The Outlook on the IDR is Stable.

The notes will constitute direct, general and unconditional
obligations of Webuild, and rank at least pari passu with all its
present or future senior unsecured obligations. The net proceeds
from the new notes will be used to refinance existing indebtedness
and for general corporate purposes.

The assignment of the final rating is contingent on the receipt of
final documents materially conforming to the information already
reviewed.

The 'BB' IDR and Stable Outlook, which was last affirmed on 5 July
2021, reflects Webuild's improved financial profile, driven by a
recent reduction in net debt (as defined by Fitch), expected
significant free cash flow (FCF) generation in 2021-2022, and solid
growth prospects for the medium term.

The rating is constrained by Webuild's high leverage. Its currently
high leverage is only partly offset by its solid business profile,
which Fitch views as being in line with an investment-grade rating.
However, Fitch expects better operating performance to help improve
the leverage profile to a level that is commensurate with the
current rating.

KEY RATING DRIVERS

Improving Leverage: Fitch forecasts funds from operations (FFO)
gross leverage of around 6.5x (net: around 3.2x) in 2021 and around
4x in 2022-2024 (net: 2.5x-2.8x). A stronger net leverage profile
is mainly supported by improving working-capital requirements on
strong new orders and the impact of the Italian "Relaunch Decree"
measures, which may increase advance payments on public works for
Italian contractors to up to 30%.

Webuild targets around EUR300 million-EUR500 million
company-defined net debt in 2021. It aims to deleverage by EUR100
million-EUR130 million a year in 2022-2023, after reducing debt
EUR442 million at end-2020.

Stabilised Working-Capital Requirement: Fitch expects
working-capital inflows in 2021-2022, with stabilisation of
working-capital requirements from 2023. In 2021, working-capital
inflows will strongly be supported by higher advance payments
related to "Relaunch Decree" measures. In the following years Fitch
expects higher working-capital consumption to support its
increasing backlog and strong pipeline of opportunities, in turn
providing improved revenue visibility for the medium term.

Pandemic Impact on Profitability: Webuild's Fitch-defined EBITDA
margin was significantly hit in 2020 (3.3%), pushing leverage
metrics above Fitch's negative rating sensitivities. This
deterioration was driven by pandemic-related disruptions leading to
delays in revenue recognition and cash collection. Some projects
had to be extended, reducing earnings that can be booked and
resulting in lower margin expectations for the short term. Fitch
views this deterioration as temporary, and expect Webuild's EBITDA
margins to recover to around 7%-8% over Fitch's four-year forecast
period.

Solid Business Profile: The business profile is mainly underpinned
by leading market positions in niche markets, a solid order backlog
and sound geographical diversification. Webuild is the global
leader in the water infrastructure sub-segment and has leading
positions in civil buildings and transportation. These strengths
are offset by significant project concentration and structural
working-capital requirements.

Fitch expects the Astaldi acquisition to have a mixed impact on
Webuild's business profile. A significant increase in scale and a
stronger market position in the domestic market are offset by
higher working-capital requirements. Fitch assumes a broadly
similar diversification of the order book.

Resilient Construction Backlog: Fitch expects significant recovery
in new orders, following a muted order intake in 2020. Fitch
projects a book-to-bill of above 1x over the medium term, driven by
a healthy pipeline of opportunities and expected recovery in the
construction market. Fitch's rating case excludes backlog
contribution from a high-speed rail line construction project in
Texas, which is pending financing approval.

Growing Exposure to Developed Markets: Fitch views Webuild's
increasing share of new projects in lower-risk countries,
especially in the US and Australia, as positive for the credit
profile. Fitch expects Webuild to generate the vast majority of its
revenue from the US, Australia and Europe in 2021-2022. The
commercial pipeline is strongly focused on north America, Europe,
the Middle East and Australia and Fitch expects declining exposure
to higher-risk markets, including Ethiopia.

DERIVATION SUMMARY

In contrast to other Fitch-rated engineering and construction
entities, Webuild has a limited presence in concessions. Its
strategy focuses on large, complex, value-added infrastructure
projects with high engineering content. The acquisition of Lane,
completed in January 2016, enhanced Webuild's presence in the US,
which is now a key country for the company and mitigates Webuild's
presence in higher-risk developing countries, especially Ethiopa.

While its business profile is solid, its net leverage exceeds that
of higher-rated peers such as Ferrovial, S.A. (BBB/Stable), which
generates stable dividend streams from its concession business.
Webuild's business profile is stronger than that of Obrascon Huarte
Lain, S.A. (OHL), due mainly to Webuild's larger scale of
operations, stronger market position and greater project
diversification.

KEY ASSUMPTIONS

-- Revenue to grow in the low teens in 2021 and mid-single digits
    in 2022-2024, excluding contribution from Astaldi;

-- Revenue contribution from Astaldi of around EUR1.8 billion in
    2021, EUR2 billion in 2022 and EUR2.2 billion annually in
    2023-2024;

-- Fitch-defined EBITDA margin of 7% in 2021 and 8% in 2022-2024;

-- Working-capital inflow of about EUR350 million in 2021 and
    EUR50 million in 2022, followed by working- capital
    consumption of around 2% of revenue in 2023-2024;

-- Capex at 3.5% of sales annually in 2021-2024;

-- Annual dividend of EUR50 million in 2021-2024.

RATING SENSITIVITIES

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

-- FFO gross leverage below 3.0x on a sustained basis;

-- FFO net leverage below 2.0x on a sustained basis;

-- Reduced concentration of 10-largest contracts to below 40%.

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

-- FFO gross leverage above 4.0x on a sustained basis;

-- FFO net leverage above 3.0x on a sustained basis;

-- Inability to generate at least neutral FCF on a sustained
    basis;

-- Weak performance on major contracts with a material impact on
    profitability;

-- Problems in receivables collection;

-- Increasing share of high-risk countries.

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

Sufficient Liquidity: At end-2020 Webuild's liquidity was supported
by about EUR2,091 million of readily available cash (excluding
EUR364 million that Fitch deemed not readily available), including
EUR550 million drawn committed banking facilities. In January 2021
the company issued an additional EUR200 million tap to its EUR550
million senior unsecured bond maturing in December 2025. This
provides sufficient headroom to cover around EUR1.3 billion debt
maturities in 2021, including its revolving credit facility (RCF).
Fitch expects positive FCF in 2021. Fitch views the company's good
relationships with local banks and access to capital markets as
positive for the credit profile.

Senior Unsecured Debt: At end-2020 Webuild's debt structure
consisted mainly of four euro-denominated senior unsecured bonds
with a total nominal amount of about EUR1.5 billion and corporate
loans with a total nominal amount of about EUR1.2 billion. Webuild
also raises fairly modest short- and medium-term construction debt
at local subsidiaries as well as modest long-term concession debt.

ISSUER PROFILE

Webuild (formerly Salini Impregilo S.p.A) is a medium-sized Italian
engineering and construction group focused on complex
infrastructure civil projects with strong leadership in the water
segment. It has a diversified geographic footprint with around 37%
of its EUR33 billion backlog at end-2020 in Italy, 19% in Americas,
17% in Africa, 10% in Australia and the remaining 8% in Asia and
the Middle East.

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.


WEBUILD SPA: S&P Assigns 'BB-' Rating on New EUR500MM Notes
-----------------------------------------------------------
S&P Global Ratings assigned its 'BB-' issue rating to the
sustainability-linked notes of up to EUR500 million, due in 2026,
to be issued by Italian construction company Webuild S.p.A.
(BB-/Stable/--). The '4' recovery rating reflects the proposed
notes' unsecured and unguaranteed nature, as well as their
structural subordination to prior-ranking claims. S&P estimates
recovery prospects at 30%. Most of Webuild's bank lines and
revolving credit facilities rank pari passu with this proposed
issuance. The issue and recovery ratings on the proposed notes are
based on preliminary information and subject to their successful
issuance and our satisfactory review of the final documentation.

Webuild intends to use the proceeds to refinance existing debt,
mainly maturing in 2022, and for general corporate purposes. The
new capital structure would have an average remaining term of about
four years. The new notes will also have sustainability-linked
features.

S&P said, "We expect the documentation for the proposed notes will
be broadly in line with that for the existing notes. We understand
the documentation includes one incurrence covenant stipulating a
minimum consolidated interest coverage ratio of 2.5x, which limits
the company's ability to incur additional debt, and permitting debt
at the issuer or material subsidiaries of up to 15% of consolidated
assets. There is also a restricted-payment covenant as well as
limitation on the sale of certain assets and transactions with
affiliates. Moreover, the documentation includes a EUR50 million
cross-default threshold provision.

"In our hypothetical default scenario, we assume a prolonged
economic downturn affects the construction sector. We also consider
a delay in collecting payments for projects that would result in
severe margin contraction and negative operating cash flow. In our
view, this would weaken Webuild's ability to meet its debt
obligations, triggering a payment default in 2025.

"We value Webuild as a going concern, based on its strong brand
value, market position, and global presence."

Simulated default assumptions:

-- Year of default: 2026

-- Jurisdiction: Italy

-- Emergence EBITDA (after recovery adjustments): EUR323 million

-- Multiple: 5x in line with the standard assumption for the
construction sector.

Simplified recovery waterfall:

-- Gross recovery value: EUR1.6 billion

-- Net recovery value for waterfall after administration expenses
(7%): EUR1.5 billion

-- Estimated priority claims: EUR0.5 billion*

-- Unsecured debt claims: about EUR2.9 billion

-- Recovery prospects: 30%

    --Recovery rating: 4

*All debt amounts include six months of prepetition interest.




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

ARTISAN NEWCO: Moody's Assigns First Time 'B2' Corp. Family Rating
------------------------------------------------------------------
Moody's Investors Service has assigned a first-time B2 corporate
family rating and a B2-PD probability of default rating to Artisan
Newco B.V. ("Group of Butchers" or "the company"), the parent
company of Meat Holdco B.V., a producer of artisanal processed meat
products across Benelux and Germany. Concurrently, Moody's has
assigned B2 ratings to the EUR330 million senior secured term loan
B due 2029 and the EUR50 million senior secured revolving credit
facility (RCF) due 2028, both to be borrowed by Artisan Newco B.V.
The outlook is stable.

Proceeds from the new loan will be used to refinance existing debt
and to fund recently-completed acquisitions.

"The B2 rating assigned to Group of Butchers reflects its business
profile, including geographical concentration, its focus mainly on
one product category and high customer concentration, as well as
the company's leading category positions and second tier market
positions in its core markets, its strong product development
capabilities, its expected moderate leverage at closing, and solid
free cash flow generation capacity," says Valentino Balletta, a
Moody's lead analyst for Group of Butchers.

"The company has a multi-year track record of organic growth,
complemented by bolt-on acquisitions, and has been resilient to the
coronavirus pandemic. Nevertheless, we believe that increasingly
mature product categories and potential changes in consumer
behavior may limit the pace of the company's future growth and
deleveraging," adds Mr. Balletta.

RATINGS RATIONALE

The B2 CFR assigned to Group of Butchers reflects the company's (1)
leading category positions in processed meat products across the
Benelux region and Germany, supported by an attractive
private-label products portfolio and second tier market positions;
(2) relatively good operating margins, particularly considering its
private-label business and track record of improving operating
performance through strong product development capabilities, which
enables it to set premium prices and gradually gain market share;
(3) flexible cost structure, which offers some protection in case
of demand volatility and a track record of positive free cash flow
(FCF), which Moody's expects to continue, supporting adequate
liquidity; (4) track record of passing raw material price increases
to customers; and (5) resilient business model because of its focus
on the food retail channel.

The rating is, however, constrained by the company's (1) limited
geographical diversification with around 72% of sales generated in
the Netherlands, 25% in Germany and 3% in Belgium; (2) relatively
modest scale, with revenues of EUR540 million pro forma for the new
acquisitions and company-adjusted EBITDA of EUR68 million; (3) the
group's high product concentration with exposure mainly to
private-label category and processed meat products; (4) the
company's client concentration risk with the top seven customers
accounting for more than 80% of revenues; (5) increasingly mature
product categories and exposure to fast-changing consumer
preferences, which could hamper revenue growth prospects; and (6)
high appetite for acquisitions, which entails integration risks and
may impede deleveraging.

Moody's estimates that Group of Butchers' Moody's-adjusted
gross/debt EBITDA at closing will be slightly over 5.0x. Assuming
no material acquisitions, Moody's expects Group of Butchers' gross
leverage could trend towards 4.5x in the 12-18 months following
transaction closing, which positions the company comfortably in its
rating category.

Nevertheless, Moody's believes that the company's appetite for
bolt-on acquisitions remains high given the fragmented market and
represents a degree of event risk. However, the company has a
positive track record in integrating acquisitions without
significantly increasing leverage because of the reasonable
acquisition multiples and the use of internally generated FCF to
partly finance these acquisitions. The B2 rating incorporates
Moody's expectation that the company will continue to pursue a
balanced approach to acquisitions to increase its scale and further
expand its market position, and the rating allows a degree of
headroom for such acquisitions.

ENVIRONMENTAL, SOCIAL AND GOVERNANCE CONSIDERATIONS

Group of Butchers' B2 rating takes into account corporate
governance considerations. The company is approximately 57% owned
by private equity firm Parcom, which, as is often the case in
private equity sponsored deals, has a high tolerance for leverage
and risk, while governance is comparatively less transparent.
Nevertheless, the company's management and founders will continue
to own a significant minority stake in the company. Group of
Butchers also has a track record of growing via bolt-on
acquisitions. Although these have thus far not had a material
impact on the company's leverage, Moody's believes that the company
is likely to pursue further acquisitions in the future which could
impede deleveraging.

Group of Butchers could be affected by certain social trends,
including demand for higher quality products, which will benefit
the company's operating performance. At the same time, the company
could be affected by growth in meat alternatives, such as vegan and
vegetarian diets, although this is a very gradual and long-term
trend.

LIQUIDITY

Moody's expects Group of Butchers to maintain adequate liquidity in
the next 12-18 months following the transaction, supported by an
estimated post-closing cash balance of EUR11.5 million and a EUR50
million committed RCF. The RCF is expected to be undrawn at
closing, with ample headroom under the springing covenant of senior
secured net leverage not exceeding 7.4x, tested when the facility
is more than 40% drawn. In addition, Moody's expects Group of
Butchers to generate positive Moody's-adjusted FCF of more than
EUR20 million in financial year 2022, and around EUR30 million per
year thereafter. Assuming no RCF utilisation, the company will have
no material debt maturities until 2029, when its term loan is due.

STRUCTURAL CONSIDERATIONS

The B2 ratings assigned to the EUR330 million senior secured term
loan B and the EUR50 million senior secured RCF, both to be
borrowed by Artisan Newco B.V., are in line with the CFR,
reflecting the fact that these two instruments will rank pari passu
and will represent substantially all of the company's financial
debt at closing of the transaction. The term loan and the RCF will
benefit from pledges over the shares of the borrower and guarantors
as well as bank accounts and intragroup receivables and will be
guaranteed by the group's operating subsidiaries representing at
least 80% of consolidated EBITDA.

The B2-PD PDR assigned to Group of Butchers reflects Moody's
assumption of a 50% family recovery rate, given the weak security
package and the limited set of financial covenants.

RATIONALE FOR STABLE OUTLOOK

The stable outlook reflects Moody's view that Group of Butchers
will be able to gradually increase its sales at a low to
mid-single-digit rate in percentage terms while maintaining or
improving its margin and mostly passing through the costs of raw
materials. The stable outlook also factors in Moody's expectations
that the company will continue to grow organically, while
maintaining a prudent approach to acquisitions, and that any
potential future transactions will not significantly weaken credit
metrics.

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

Group of Butchers' ratings could be upgraded if it (1) increases
its scale and enhances its business profile with a more diversified
product range and geographical presence while maintaining a prudent
financial policy; (2) reduces its Moody's-adjusted gross
debt/EBITDA below 4.5x on a sustainable basis; (3) continues to
generate solid positive free cash flow; and (4) maintains adequate
liquidity.

The ratings could be downgraded if (1) the company fails to
maintain its Moody's-adjusted gross/debt EBITDA below 6.0x as a
result of softer sales, erosion of profit margins or significant
debt-financed acquisitions; (2) the company's free cash flow turns
negative on a sustained basis; or (3) liquidity deteriorates.

LIST OF AFFECTED RATINGS

Issuer: Artisan Newco B.V.

Assignments:

Probability of Default Rating, Assigned B2-PD

LT Corporate Family Rating, Assigned B2

Senior Secured Bank Credit Facilities, Assigned B2

Outlook Action:

Outlook, Assigned Stable

PRINCIPAL METHODOLOGY

The principal methodology used in these ratings was Consumer
Packaged Goods Methodology published in February 2020.

COMPANY PROFILE

Artisan Newco B.V. (Group of Butchers), domiciled in the
Netherlands, is the leading producer of artisanal meat products
across the Benelux region. The company reported revenues in the
twelve months ending September 2021 of approximately EUR540 million
and EBITDA of EUR68 million. Its shareholders include Parcom, a
Dutch private equity fund with 57% ownership, with management and
the founders owning the remaining shares.


GROUP OF BUTCHERS: S&P Assigns Prelim. 'B' ICR, Outlook Stable
--------------------------------------------------------------
S&P Global Ratings assigned its preliminary 'B' long-term issuer
credit rating to Group of Butchers (GoB) holding company Artisan
Holdco B.V., and its preliminary 'B' issue and '3' recovery ratings
to the senior secured term loan B (TLB).

The stable outlook reflects S&P's view that GoB's credit metrics
should remain stable over the next 12 months, with positive FOCF
that will allow the group to adequately self-fund its operations.

S&P forecasts GoB, a Dutch private-label meat processing company
specialized in sandwich meat and ready-to-eat meat products, will
generate revenue of close to EUR600 million and S&P Global
Ratings-adjusted EBITDA of about EUR65 million in 2022.

The group benefits from its premium positioning, close links to
large local retailers, ability to quickly offset most raw materials
cost inflation, and efficient operations, but is constrained by its
modest scale of operations in niche (but expanding) product
segments, high geographical concentration in the Netherlands, and
reliance on a few large retail customers.

GoB is planning to issue a new EUR330 million senior secured term
loan B (TLB) and a new EUR50 million senior secured revolving
credit facility (RCF) to refinance its current debt structure and
fund two acquisitions.

GoB plans to refinance its entire capital structure and fund
acquisitions. The proposed new long-term debt issuance consists of
a EUR330 million senior secured TLB and a EUR50 million senior
secured RCF. S&P understands that GoB will use the proceeds to
refinance its capital structure (EUR220 million of existing debt
and a EUR10 million vendor loan) and fund two acquisitions. The RCF
will be fully undrawn at transaction closing.

S&P said, "We expect the group will maintain stable credit metrics,
with adjusted debt leverage of 5.5x-6.0x, despite likely continuing
to pursue debt-financed acquisitions. Under our base-case
projections for 2022 and 2023, we expect S&P Global
ratings-adjusted debt leverage of 5.5x-6.0x, with EBITDA interest
coverage of about 4.5x, indicating good credit metrics headroom at
the 'B' rating level. Throughout GoB's history, acquisitions have
been a pillar of revenue and EBITDA growth. Under Parcom's
ownership since October 2020, the group has already acquired two
companies: Zandvliet (a Dutch private label meat processor) and Die
Schnitzelmacher (a German branded and nonbranded meat producer). We
assume the group will continue to pursue acquisitions as it looks
to consolidate the still-highly-fragmented geographical markets of
the Netherlands, Germany, and Belgium. Notably, we think the group
will target mostly high-end meat processors and to a lesser extent
nonmeat products to help diversify its product offering and cater
to changing consumer preferences. That said, we think the group is
unlikely to raise adjusted debt leverage above 6x as per our
understanding of the risk tolerance of management and financial
sponsor Parcom.

The group is, and will remain, FOCF generative with low capital
expenditure (capex) intensity and good control on working capital.
GoB should be able to expand its FOCF base in 2022 thanks to EBITDA
growth and additional cash flows from the two recent acquisitions.
With total capex of about 3% of revenue annually, it has moderate
capital intensity. S&P said, "We also note the relatively low
seasonality in the business and stable cash flow conversation
thanks to a strong base of retail customers. Under our base case,
we see GoB generating FOCF of EUR20 million-EUR30 million in 2022
and EUR30 million-EUR40 million in 2023. This includes the
additional cash flows from acquisitions."

S&P said, "Despite high cost pressures and market volume declines,
we see GoB as well positioned to generate revenue and EBITDA
growth. GoB operates mostly in the meat processing industry, which
is relatively noncyclical but suffering from continued volume
declines in its main markets like the Netherlands due to changing
consumer preferences. That said, it is mostly positioned in niche
expanding segments such as sandwich meat (a very common meal in the
Netherlands) and ready-to-eat meat, which are supported by
increasing work-from-home habits. The group is also positioning
itself as a premium producer, which gives it better pricing power
than most private-label companies. We understand that strong
knowledge of consumer tastes is driven notably by extensive data
analysis and its close relationships with large retailers. In our
view, this ability to innovate, being a local leader in a
nondiscretionary and profitable category for retailers and the fact
most raw materials have pass-through mechanisms, should enable
GoB's profitability to absorb much higher production and
distribution costs observed in the packaged food sector since
2021." The company's well invested, largely automated, production
facilities and track-record of high and stable capacity utilization
also support its cost leadership.

GoB's modest scale of operations, presence in niche private label
segments, and high concentration to large Dutch retailers partially
offset these business strengths. Despite its track-record of
growth, GoB remains of modest scale compared to large players in
the packaged food industry, including meat processors, with
projected revenue of EUR610 million and adjusted EBITDA of about
EUR65 million. S&P said, "We view GoB as relatively close in size
to French branded and private-label food producer Financiere LFF -
Labeyrie (B/Stable/--) and Dutch branded and private-label food
producer Signature Foods B.V. (B/Stable/--) while being smaller but
more profitable and FOCF generative than U.K. poultry producer
Boparan Holdings Ltd. (B-/Negative/--). In our view, although GoB
is outperforming the overall meat processing market, which is in
slight volume decline, it is a leader in mostly niche segments.
This means the group needs to direct a lot of time and investments
in finding new growth opportunities in pockets of the market and
introduce regular new product launches to cater to fast-changing
consumer habits. The group is also mostly a private-label business
(80% of revenue) and thus doesn't benefit from a portfolio of
well-known brands. We believe its competitive advantage lies more
in cost leadership and good knowledge of consumer preferences to
quickly launch new high-value meat products." GoB is also
particularly concentrated in its home market of the Netherlands
(70% of revenue) although it has expanded recently in Germany,
which now accounts for about 25% of revenue. In addition, GoB has
sizeable customer concentration with its two largest clients,
Albert Heijn and Jumbo, representing more than half of its sales.

S&P Global Ratings believes the omicron variant is a stark reminder
that the COVID-19 pandemic is far from over. Uncertainty still
surrounds its transmissibility, severity, and the effectiveness of
existing vaccines against it. Early evidence points toward faster
transmissibility, which has led many countries to reimpose social
distancing measures and international travel restrictions. S&P
said, "Over coming weeks, we expect additional evidence and testing
will show the extent of the danger it poses to enable us to make a
more informed assessment of the risks to credit. In our view, the
emergence of the omicron variant shows once again that more
coordinated and decisive efforts are needed to vaccinate the
world's population to prevent the emergence of new, more dangerous
variants."

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

"The stable outlook reflects our view that GoB's operating
performance should remain resilient over the next 12 months,
despite the volume decline in the overall meat processing sector,
integration risks related to the acquisitions, and a strong
increase in operating costs like raw materials, energy, and
packaging.

"To maintain the current rating, we would need to see GoB meeting
our base-case projections, which is to maintain adjusted debt
leverage of 5.5x-6.0x and EBITDA interest coverage above 3.0x, and
generate positive FOCF of at least EUR20 million annually.

"In our base case, we assume that the group will pass on price
increases to retailers, notably thanks to its agreed pass-through
agreements with its main clients, while controlling working capital
and capex. In our view, the strategy to find niche expanding
segments, innovate toward higher-end products, and operate a very
efficient manufacturing base and beneficial supplier-retailer
partnerships should help stabilize and then increase EBITDA margin
from about 10.5%-11.5% in 2022 to about 11.5%-12.5% in 2023. We
believe the business is not seasonal nor capex intensive, thus
supporting FOCF generation.

"We could lower the preliminary rating on GoB if, contrary to our
base case, adjusted debt leverage rises durably above 7x with
neutral to negative FOCF over the next 12 months.

"We think this could occur if the company is unable to create value
in its product offering and sees accelerated volume declines in its
segments. This, coupled with high inflation on operating expenses,
could lead to a significant margin squeeze. We could also lower the
ratings on the company if it immediately pursues an aggressive
debt--financed acquisition while still in the process of
integrating its three current acquisitions, because this would
create integration risks and headwinds to the deleveraging path.

"We could take a positive rating action if GoB's revenue and EBITDA
base expand significantly and enable it to achieve a much larger
scale in Western Europe. In addition, we would view positively the
group improving its geographical and product category
diversification."

This could occur through a track record of strong organic growth
with successful expansion in new markets, product segments, and
adjacent categories to processed meat, with a continued track
record of successfully integrating new acquisitions.

S&P could also raise the preliminary rating should the company
deleverage durably below 5x on an adjusted basis, but this would
depend on a firm commitment from the financial sponsors to sustain
such a low level of leverage over the long term.

ESG credit indicators: E-3 S-2 G-3

S&P said, "Environmental factors are a moderately negative
consideration in our credit rating analysis of GoB. Meat processing
has higher-than-average exposure to environmental risks than other
food production categories, mainly related to the high exposure in
the supply chain to carbon dioxide (CO2) emissions and
biodiversity. We see beef meat especially as a source of high CO2
emissions. In addition, raw materials sourcing concentration for
beef and pork meat has a negative impact on biodiversity.

"Governance factors are a moderately negative consideration, as is
the case for most rated entities owned by private-equity sponsors.
We view financial-sponsor-owned companies with aggressive or highly
leveraged financial risk profiles as demonstrating corporate
decision-making that prioritizes the interests of the controlling
owners. This also reflects the generally finite holding periods and
a focus on maximizing shareholder returns.

"Social factors are an overall neutral consideration but we value
the track record in product and employee safety."




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

AUTOFORM ENGINEERING: S&P Assigns Prelim. 'B' ICR, Outlook Stable
-----------------------------------------------------------------
S&P Global Ratings assigned its preliminary 'B' long-term issuer
credit rating to CEP V Investment 23 S.a r.l, the immediate holding
company of Switzerland-based industrial software provider AutoForm
Engineering GmbH, and its 'B' issue rating to the proposed senior
secured term loan.

The stable outlook reflects S&P's view that AutoForm's revenue
growth will accelerate to 12%-14% in 2022-2023 compared with about
10% in 2021, thanks to upselling, increasing customer penetration,
and new assembly solutions, while adjusted EBITDA margin will
continue at more than 50%.

In November 2021, private equity firm Carlyle agreed to acquire
Switzerland-based sheet metal forming and assembly simulation
software provider AutoForm. The transaction will be partly funded
by EUR472 million senior secured term loan, undrawn EUR55 million
RCF and EUR184 million payment-in-kind (PIK) facility.

The highly leveraged capital structure is partly offset by
AutoForm's good deleveraging prospect and cash flow. Once the
transaction closes, the company's debt burden will be high, leading
to S&P Global Ratings-adjusted debt to EBITDA of about 10x in 2022.
This is higher than that of typical 'B' rated software companies,
at 7x-8x. However, this is offset by AutoForm's:

-- Deleveraging prospects to 9x in 2023, with further deleveraging
in following years thanks to more than 10% expected topline
growth.

-- Leverage ratio is only at about 7x excluding the subordinated
and cash-preserving PIK facility. S&P expects to treat preference
shares as equity subject to our review of final documentation.

-- Meaningful FOCF of more than EUR35 million in 2022, thanks to a
strong EBITDA margin of more than 50% supported by its lean
operations, noncash-paying PIK facility, and limited working
capital and capital expenditure (capex) needs. This leads to S&P
Global Ratings-adjusted FOCF-to-debt ratio of more than 5%,
supporting the company's financial risk profile.

-- Unlike other sponsor owned software names operating in
fragmented markets, S&P sees limited M&A risks because of the
company's dominant position in the niche market, mature software
offerings to auto OEMs and original equipment suppliers (OESs) and
its focus on organic growth. S&P also sees limited risks on
dividends thanks to the sponsor's relatively prudent financial
policy.

AutoForm's niche focus and high customer concentration make it
susceptible to technological changes and competition, although the
risk is not imminent. The company generates almost all of its
revenue from the sheet metal forming simulation software for auto
OEMs and OESs. Its assembly solutions remain nascent despite
expected high growth potential and good traction. S&P thinks the
company's niche focus limits its size and total addressable market
(TAM), estimated at about EUR550 million according to the company.
Furthermore, AutoForm's customer concentration is relatively high,
with the top 20 customers contributing about 50% of the company's
revenue. This could be an underestimation given large OEMs' strong
influence on OESs' choice on simulation software, and OESs account
for about 52% of AutoForm's revenue base. Although the company
enjoys on average 20-year relationships with its top 20 customers
and customer churn rate in terms of annual contract value (ACV) is
very low at about 2%, S&P thinks AutoForm is more susceptible to
technological changes and competition compared with larger and more
diversified industrial software companies like Dassault Systemes
SE. The risk could be exacerbated by the company's short customer
contracts that are renewed yearly, although this is AutoForm's
intention for this contract structure. However, alternative
technologies like composite material, casting, and 3D printing are
only adopted by auto OEMs at a limited scale, not posing an
immediate threat to the company, and other existing offerings from
competitors are lacking the advantage in terms of technology and
total cost of ownership.

AutoForm faces higher FX risks compared with other niche software
peers operating in a single country. The company has a globally
diversified revenue based despite its limited size. This is because
of the geographical diversification of AutoForm's customer base,
and its strategy to invoice customers primarily in local currency.
With about 60% of revenue from outside of Europe, S&P thinks the
company is more exposed to unfavorable FX movements, which could
lead to higher revenue and margin volatility compared with other
niche software peers like German software provider P&I operating in
one region. However, the variety of currencies involved would limit
the risk somewhat.

The business model is resilient, with limited impact from economic
downturns. AutoForm enjoyed a positive ACV growth of 2% in 2020
despite 16% decline of global light vehicle production from the
pandemic. ACV growth has consequently rebounded to about 11% in
2021 mainly stems from upselling. S&P said, "We think AutoForm's
business resiliency mainly stems from its software's mission
critical nature to auto OEMs for new model development, which leads
to much shorter time to production and higher cost savings compared
to the cost of the software. We think the auto market's continued
rebound and increasing electric vehicle sales will further support
the company's topline growth."

AutoForm enjoys limited competition and high barriers to entry
thanks to its strong customer relationships and technological lead.
The company enjoys a dominant position in the niche market and
estimates its market share of about 70%, ringfenced by its loyal
customer base and technological leadership in terms of product
functionalities and ease of use. S&P thinks AutoForm's close and
long working relationships with global leading OEMs and OESs make
it difficult for competitors and new entrants to gain market share,
while providing the company first access to customers' pain points
and necessary information, for example new materials, for product
development. Also, it ensures that the majority of its customers
are using the latest version of software, leading to significant
cost savings for AutoForm given limited maintenance needs, and
freeing up the R&D capacity for new products development. The
company is extremely R&D focused with 70% of the company's
full-time employees working in R&D and 88% of them working on
product development. This further supports AutoForm's technological
advantage compared with those of competitors with its software
offers customers faster and more comprehensive solutions that are
relatively easy to use. By leveraging its expertise and experience,
the company was first in offering customers the assembly solution,
which could further increase customer retention. Furthermore, long
adoption time by customers, high switching costs related to
training, and software integration pose additional barriers for
competitors.

S&P said, "The stable outlook reflects our view that AutoForm's
revenue growth will accelerate to 12%-14% in 2022-2023 compared
with about 10% in 2021, thanks to upselling, increasing customer
penetration, and new assembly solutions, while maintaining adjusted
EBITDA margin of more than 50%. This will lead to sound
deleveraging toward 9x (6x excluding PIK) in 2023 compared with our
forecast of 10x (7x excluding PIK) in 2022, and improve FOCF to
debt to 6%-7%."

S&P could lower the rating if AutoForm experiences much
slower-than-expected revenue growth, pursues an aggressive
shareholder return or acquisition strategy, or decided to pay cash
interest on the PIK facility, leading to:

-- Sustained adjusted leverage of more than 10x (7x excluding
PIK);

-- FOCF to debt of less than 5%; or

-- An EBITDA cash interest coverage ratio below 3x.

A positive rating action is unlikely because of the company's
highly leveraged capital structure and financial sponsor ownership.
However, S&P could raise the rating if:

-- AutoForm's adjusted leverage is below 6x, coupled with the
sponsor's strong commitment to maintain the ratio at this level;
and

-- FOCF to debt stays well above 10%.

ESG credit indicators: E-2 S-2 G-3

S&P said, "Governance factors are a moderately negative
consideration in our credit analysis of AutoForm. Our assessment of
the company's financial risk profile as highly leveraged reflects
corporate decision-making that prioritizes the interests of the
controlling owners, as is the case for most rated entities owned by
private-equity sponsors. Our assessment also reflects their
generally finite holding periods and a focus on maximizing
shareholder returns."




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

ADVANZ PHARMA: New Incremental Notes No Impact on Moody's B3 CFR
----------------------------------------------------------------
Moody's Investors Service has said that the B3 corporate family
rating and B3-PD probability of default rating of UK-based
pharmaceutical company ADVANZ PHARMA Holdco Limited (ADVANZ or the
company, B3 stable) and the B3 ratings of Cidron Aida Finco S.a
r.l., its direct subsidiary, were unchanged by the proposed EUR150
million backed senior secured incremental notes to be issued by
Cidron Aida Finco S.a r.l. The outlook on all entities is stable.
Issuance proceeds will initially sit on ADVANZ's balance sheet but
the company intends to use them to fund future acquisitions.

RATINGS RATIONALE

RATING RATIONALE FOR THE NOTES

The incremental notes are fungible with the EUR475 million existing
backed senior secured notes maturing in 2028. They rank pari passu
with a EUR305 million senior secured first lien term loan B which
is borrowed at the same entity level. These debt instruments
substantially make up the capital structure, hence they are rated
in line with ADVANZ's B3 corporate family rating (CFR).

RATING RATIONALE FOR THE CFR

The planned issuance is credit negative because it will increase
ADVANZ's gross leverage by around 0.8x without any immediate EBITDA
addition. Moody's estimates that adjusted gross/debt/EBITDA for
ADVANZ will be around 6.9x at the end of December 2021, pro forma
for the bond tap.

The transaction follows a challenging 2021 during which the rating
agency calculates that organic revenue receded by around 8% versus
its previous expectation of a low single-digit percentage decline.
While products acquired in 2020 performed relatively well,
competition and price pressure in the UK and the US markets
(together representing around 60% of revenue), with limited
exceptions, reduced revenue while usage of certain hospital
products was pressured by the pandemic. In addition, the commercial
launch of Mytolac, a potentially large new product, has been slower
than expected. The high margin nature of products whose revenue
decreased the most in 2021 led to an EBITDA reduction of more than
12% organically, according to Moody's.

In 2022, the Mytolac roll-out will reduce organic revenue
regression to around 3% but the rating agency forecasts that
headwinds including price regulation and continued intense
competition will result in a 2022 revenue decline for the base
business similar to 2021's. Moody's had previously expected that
ADVANZ would achieve organic revenue and EBITDA growth from 2022.
The rating agency forecasts that EBITDA from future acquisitions
will mitigate the projected reduction in organic EBITDA such that
adjusted leverage will remain around 7.0x this year.

The B3 CFR primarily reflects the company's high leverage, which
Moody's forecasts will stay above 6.0x for the next few years, and
the structural decline in its organic revenue and EBITDA.
Acquisitions and investment in its R&D pipeline are therefore
necessary to generate growth but result in ongoing downward
pressure on margins. The group's business profile is constrained by
a degree of concentration risk in the UK and US, where competition
and pricing pressure is intense.

Conversely, ADVANZ's credit profile benefits from good product and
therapeutic diversity as well as the group's broad geographic
presence. In addition, its asset light business model commands a
high Moody's-adjusted EBITDA margin of around 38% and limited
capital expenditure, which contributes to solid revenue conversion
into free cash flow (FCF, before drug license acquisitions) in the
range of $60 million to $70 million per annum going forward.

ESG CONSIDERATIONS

Governance factors that Moody's considers in ADVANZ's credit
profile include the appetite for leverage as evidenced by the
current capital structure and proposed transaction and in light of
the structural EBITDA decline organically. Moody's assessment also
incorporates the risk that the company would embark on debt-funded
acquisitions which would increase leverage or business risk.

Main social risks for ADVANZ pertain to customer relations. In
2021, it has been fined by the UK's Competition and Markets
Authority (CMA) for infringement of competition laws regarding two
products. The maximum fine payable by ADVANZ is around GBP50
million. The company has appealed the decision and did not carry a
provision for legal liabilities on its balance sheet as of
September 30, 2021. Moody's believes it is unlikely that ADVANZ
would have to make any payments in 2022. While the CMA has now
closed investigations into six other products marketed by ADVANZ,
there are three open cases which lead to ongoing litigation costs
(which are recurring in Moody's view) and create adverse event
risk.

LIQUIDITY

Moody's expects that ADVANZ's liquidity will remain good over the
next 12-18 months. The company had GBP106 million of unrestricted
cash on balance sheet at the end of September 2021 and will add
approximately GBP130 million equivalent with the bond tap. While
the rating agency forecasts that these balances will reduce as the
cash is used to fund acquisitions, solid FCF generation (after
interest and before acquisitions) as well as a fully undrawn $200
million senior secured revolving credit facility (RCF) support
ADVANZ's liquidity. The RCF is subject to a springing net leverage
covenant, tested when the facility is drawn for more than 40%, with
ample headroom expected.

RATING OUTLOOK

The stable outlook reflects Moody's expectation that the organic
regression in revenue and EBITDA will stop from 2023 upon
successful launch of larger pipeline products, albeit with
declining margins and adjusted gross debt/EBITDA remaining well
above 6.0x. The stable outlook assumes that ADVANZ will execute
acquisitions which can be mostly funded using cash on hand and
internally generated cash flows or which do not increase gross
leverage on day one.

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

Upward pressure on ADVANZ's ratings could develop should the
company achieve sustained like-for-like revenue and EBITDA growth,
leading to a reduction in Moody's-adjusted debt/EBITDA to below
5.5x while maintaining solid FCF and good liquidity. The absence of
a satisfactory resolution of legal proceedings in the UK could
constrain rating or outlook improvement.

ADVANZ's ratings could be under downward pressure if (1) organic
revenue and EBITDA regression were sustained at their current
levels, or (2) liquidity weakened, particularly if FCF reduced
sustainably, or (3) if Moody's adjusted gross debt/EBITDA increased
towards 7.0x, including as a result of debt-funded acquisitions.

PRINCIPAL METHODOLOGY

The principal methodology used in this rating was Pharmaceuticals
published in November 2021.

CORPORATE PROFILE

Headquartered in London, UK, ADVANZ is a pharmaceutical company
marketing a portfolio of more than 170 branded drugs and generics
in about 100 countries and across various therapeutic areas. In the
twelve months to September 30, 2021, ADVANZ had revenue of GBP428
million and EBITDA of GBP176 million (before exceptional items and
including a full year's contribution of 2021 acquisitions). ADVANZ
was acquired by funds ultimately controlled and advised by
financial sponsor Nordic Capital in June 2021.


ADVANZ PHARMA: S&P Alters Outlook on 'B-' ICR to Stable
-------------------------------------------------------
S&P Global Ratings revised its outlook on U.K.-headquartered
specialty pharmaceutical company ADVANZ Pharma HoldCo Ltd. (ADVANZ
Pharma) to stable from positive. At the same time, S&P affirmed its
'B-' long-term issuer credit rating on ADVANZ Pharma and its 'B-'
issue rating on its senior secured debt instruments, including the
proposed EUR150 million add-on.

The stable outlook indicates S&P's view that ADVANZ Pharma's
performance will be resilient, with an S&P Global Ratings-adjusted
EBITDA margin that it forecasts in the 33%-34% range, and that it
will remain free of liquidity pressure in the next 12 months.

S&P said, "ADVANZ Pharma's recent operating performance was softer
than we expected, but we forecast that its reported revenues will
increase by about 3%-4% in the next 12 months. ADVANZ Pharma's
reported revenues in the year to September 2021 were 0.5% lower
than those in the prior year. The company's performance saw a
negative impact from greater competitive pressure than it expected
on its portfolio of branded legacy medicines marketed in the U.S.
Additionally, the launch of acromegaly treatment Mytolac was
delayed in Germany due to the time it took to gain local approval
and to COVID-19-related hurdles hampering the sales effort. In
addition, sales of hydroxychloroquine were lower in the U.S. than
in the prior year, when they were boosted by the pandemic. These
headwinds were partly offset by the acquisitions of Zonegran for
the treatment of epilepsy in June 2021 and of Correvio Pharma in
May 2020. Our forecast for ADVANZ Pharma's revenues for 2022
includes the full-year impact from the acquisition of Zonegran, the
ramp-up of Mytolac sales, and the potential launch of new products.
Our base case also incorporates competitive pressure on ADVANZ
Pharma's base business, revenues from which we forecast will
decline by about 3%-4% annually. We also consider potential
acquisitions of new products that will drive further revenue
growth.

"We anticipate that ADVANZ Pharma will generate a high adjusted
EBITDA margin in the 33%-34% range in the next 12 months. This is
lower than historical levels due to a shift in the product mix. The
lower margin reflects lower sales of the company's branded
medicines that it sells in the U.S. and that have high
profitability overall. Also contributing to the lower margin is our
forecast of a shift in the product mix, with a growing share of
product sales that require higher investments in the commercial
infrastructure. As such, we forecast that selling and marketing
costs will increase to about 7.0%-8.0% of revenues in 2022 from
about 6.8%-6.9% in 2019-2020. We also include in our base case
costs relating to the ongoing investigations by the U.K.'s
Competition and Markets Authority (CMA) into alleged
anticompetitive behavior; the costs of sourcing acquisition
opportunities; and reorganization costs that we forecast at GBP15
million-GBP20 million in 2022. That said, we consider that ADVANZ
Pharma generates high profit margins thanks to its business model
of outsourcing all its development and manufacturing activities and
locating most employees in India.

"We forecast that ADVANZ Pharma will generate high annual free
operating cash flow (FOCF) of GBP40 million-GBP50 million in the
next 12 months. This is thanks to the company's high profit margins
and capital expenditure (capex)-light business model, as well as
its low working capital requirements. The absence of in-house
development and manufacturing activities results in low annual
capex requirements that we forecast at about GBP10 million-GBP15
million in the next 12 months. Our base case also factors in about
GBP10 million-GBP20 million of annual working capital requirements
to increase inventories of pipeline products and integrate stocks
of products the company recently acquired, including Zonegran in
June 2021, and those it could acquire in future.

"We forecast that ADVANZ Pharma's capital structure will remain
highly leveraged, with adjusted debt to EBITDA of about 8.0x in
2022.Our adjusted debt figure includes all the senior secured debt
instruments in the capital structure, including the EUR305 million
term loan B; the EUR625 million senior secured notes, including the
proposed EUR150 million add-on; the GBP335 million senior secured
notes; and our estimate of about GBP5 million of lease liabilities.
We do not deduct cash because we expect the company to allocate
internally generated cash flow and new debt to acquiring new
products, rather than prepaying debt. We forecast that the company
could reduce its leverage moderately thanks to product acquisitions
and new product launches that it will support with investments in
its sales force offsetting the decline in revenue from its
portfolio of established products.

"We do not anticipate a material change in ADVANZ Pharma's business
strategy following the upcoming changes in management. In November
2021, ADVANZ Pharma announced that Mr. Graeme Duncan and Mr. Adeel
Ahmad will step down from their respective roles of CEO and CFO
early in 2022. The company has announced that Mr. Duncan and Mr.
Ahmad will be replaced by Dr. Steffan Wagner and Mr. Andreas
Stickler, respectively, while Mr. Duncan will remain involved in
the company as a special advisor to the board of directors. We
forecast that ADVANZ Pharma will not change its business strategy
once its incoming CEO and CFO start their respective roles, and
will continue to seek growth from product launches and the
acquisition of niche established medicines.

"The stable outlook reflects our view that ADVANZ Pharma's
operating performance will remain resilient and that the company
will achieve an adjusted EBITDA margin in the 33%-34% range. We
forecast that the company will generate positive FOCF that we
anticipate it will use alongside new debt to fund business
development opportunities. We anticipate that potential new product
launches that the company will support with investments in its
sales infrastructure could lead to a moderate reduction in the high
leverage we forecast for 2022.

"We could take a negative rating action in the next 12 months if
ADVANZ Pharma's leverage ratio deteriorates materially compared to
our base case such that we consider its capital structure
unsustainable. This could happen in the case of a material decline
in the base business that the company is unable to offset with
product launches and acquisitions. It could also happen in the
event of material setbacks in integrating new products, resulting
in higher costs than it plans. We could also take a negative rating
action if FOCF turns negative such that the company's ability to
self-fund its operations and support its product launches weakens.

"We could consider a positive rating action if ADVANZ Pharma
demonstrates organic revenue growth of at least 2% annually, thanks
to product launches fully offsetting the decline in its base
business, while remaining disciplined in its acquisition strategy
and free of integration setbacks. An upgrade would also depend on
the company improving its leverage ratio to below 6.5x and
continuing to generate high EBITDA margins. Under this scenario,
the company would likely achieve an EBITDA cash interest coverage
ratio of 3.0x or above, and an FOCF-to-debt ratio comfortably in
the 5%-10% range."

ESG Credit Indicators: E-2 S-3 G-3

S&P said, "Social factors are a moderately negative consideration
in our credit rating analysis of ADVANZ Pharma, because of the
three ongoing investigations by the U.K.'s CMA for alleged
anticompetitive behavior. If the CMA imposes a financial penalty,
this could weaken the company's credit metrics. Nevertheless,
ADVANZ Pharma maintains that it has not infringed any competition
laws and is appealing the two adverse decisions of July 2021.

"Governance factors are also a moderately negative consideration,
as is ownership by private-equity sponsors. We view financial
sponsor-owned companies with aggressive or highly leveraged
financial risk profiles as demonstrating corporate decision-making
that prioritizes the interests of the controlling owners. This also
reflects the generally finite holding periods and a focus on
maximizing shareholder returns."


CARILLION: Jr. Auditor Unaware He Was Doing Anything Wrong
----------------------------------------------------------
Michael O'Dwyer at The Financial Times reports that the most junior
member of the KPMG audit team accused of forging documents to
mislead regulators inspecting its work for UK outsourcer Carillion
was unaware he was doing anything wrong, a tribunal has heard.

According to the FT, lawyers for Pratik Paw said the former KPMG
employee had also cited the firm's hierarchical structure and his
minority ethnicity in his defence.

The claims were made on the third day of an industry tribunal on
allegations by the Financial Reporting Council that Paw and five
more senior KPMG colleagues forged documents following questions
from its inspectors, the FT discloses.

It is alleged the auditors then passed off "fabricated" documents
to give the impression they had been created during the audit of
the 2016 financial statements of Carillion, the FT notes.  The
outsourcer collapsed in January 2018 with liabilities of GBP7
billion, the FT states.

Lawyers for Mr. Paw, who denies wrongdoing, said he was a
25-year-old junior employee and was not yet a qualified accountant
at the time of the inspection of the Carillion audit in 2017, the
FT recounts.

His lawyers said following questions from FRC inspectors, Mr. Paw
was asked by colleagues to type up minutes based on handwritten
notes of meetings senior colleagues held with overseas auditors,
the FT relays.  The tribunal heard a senior colleague later sent
the minutes to the inspectors, the FT notes.

According to the FT, Scott Allen, Mr. Paw's barrister, said his
client had not attended the meetings, but did not raise concerns
because he was unaware that what he was being asked to do was
wrong.


CIDRON AIDA: Fitch Affirms B+ Rating on Sr. Secured Debt
--------------------------------------------------------
Fitch Ratings has affirmed Cidron Aida Bidco Ltd.'s (Advanz) senior
secured instrument ratings at 'B+' with a Recovery Rating of 'RR3'.
This follows an announced GBP129 million (euro-equivalent) tap of
the group's GBP987 million (equivalent) senior notes maturing 2028.
Concurrently, Fitch has also affirmed Advanz's Long-Term Issuer
Default Rating (IDR) at 'B' with Stable Outlook.

The debt proceeds will be used for general corporate purposes and
support Advanz's ambitious acquisition strategy, which Fitch
expects to accelerate during 2022. The debt raising was anticipated
under Fitch's rating case to support Advanz's growth strategy.

The 'B' IDR of Advanz remains constrained by scale, high leverage
and execution risk in implementing its revised strategy as an
asset-light multi-national pharmaceutical company focused on niche
and specialist off-patent branded and generic drugs. However,
positively, the rating reflects Advanz's refocused strategy
engaging in both new generic drug development and the life-cycle
management of existing off-patent drugs, with an increased focus on
specialist distribution to hospitals in Europe. The IDR is
supported by Advanz's diversification across drugs, treatment areas
and geographies, strong profitability and healthy cash generation.

The Stable Outlook reflects Fitch's expectation that, despite
Advanz's capacity to deleverage supported by strong free cash flow
(FCF) generation, available funds will be reinvested in the
business to support and accelerate growth, leading to a
comparatively static leverage profile through to 2023.

KEY RATING DRIVERS

Current Performance as Expected: Fitch views 2021 performance as
broadly in line with Fitch's expectations, with sales of USD575
million and an EBITDA margin of around 41%. After some demand
dislocation during the pandemic, particularly from hospitals, and
softer performance in its US legacy business Fitch expects Advanz's
new management in 2022 to demonstrate their ability to implement
their ambitious 'buy-and-build' strategy and improve the
performance of the US legacy portfolio with active lifecycle
management.

Strategic Refocus Drives Growth: Fitch's rating case assumes that
organic growth will be driven by Advanz's refocused strategy to
actively engage in the development and marketing of targeted
specialist generic drugs. This should offset the assumed moderate,
but steady, decline of its established off-patent drug portfolio,
subject to active life-cycle management. The focus on bringing
value-added generic drugs to market through co-development,
in-licencing and distribution agreements is a distinct feature of
Advanz's refocused strategy. This differentiates it from some of
its European leveraged-finance asset-light peers, resulting in
greater organic growth potential, but also more investments in the
pipeline and associated innovation risks.

High Financial Leverage, M&A Assumed: High leverage is a rating
constraint. Fitch forecasts funds from operations (FFO) gross
leverage to remain around 6.5x-7.0x until 2023, or total debt with
equity credit/operating EBITDA at around 6.0x, based on annualised
acquisition contribution, as Fitch assumes a prioritisation of
investments in growing the business, funded by free cash flow (FCF)
and available debt, over deleveraging. Therefore, Fitch's rating
case assumes discretionary additional investments in acquisitions
and in-licencing deals to support Advanz's strategic development,
bringing discipline around financial policies and M&A into focus to
protect the rating.

Satisfactory Cash Generation Supports Ratings: Advanz's high
financial leverage is supported by strong, albeit gradually
eroding, profitability, with EBITDA margins under Fitch's rating
case trending towards 37% (from currently close to 44%) until 2023.
This is predicated on expected investments in its pipeline and
marketing infrastructure to support projected revenue growth.
Nevertheless, its asset-light manufacturing set-up supports strong
cash generation, with FCF margins expected to remain around 15%.

Growth Opportunities in Generic Markets: Structural volume growth
in generic drug markets is driven by an ageing population, higher
prevalence of chronic diseases and an increasing number of drugs
losing patent protection. Large innovative pharmaceutical companies
are increasingly optimising their life cycle and tail-end drug
management by divesting smaller off-patent drugs to refocus
resources and obtain proceeds to re-invest in the business. This
offers smaller groups, such as Advanz, significant inorganic growth
opportunities. However, Fitch expects generic drug pricing to
remain under pressure, spurring investments in scale,
diversification, low-cost manufacturing and more specialist
products to protect growth and profitability.

High Regulation/Litigation/Conduct Risks: Fitch assumes continued
regulatory pressure on pharmaceutical groups as focus on the value
of new treatments to healthcare systems increases, particularly in
a period of governments' fiscal consolidation in the post-pandemic
environment. Therefore, Fitch views event risk around regulation,
litigation and conduct, particularly in generic drugs, as high and
hence deem the ongoing CMA investigation into possible past
competition infringements an event risk faced by Advanz (Fitch
includes legal costs in Fitch's rating case, but not fines or other
related payouts).

DERIVATION SUMMARY

Fitch rates Advanz and conducts peer analysis using its Global
Navigator Framework for Pharmaceutical Companies. Fitch considers
Advanz's 'B' rating against other asset-light scalable specialist
pharmaceutical companies focused on off-patent branded and generic
drugs such as Cheplapharm Arzneimittel GmbH (B+/Stable),
Pharmanovia Limited (Atnahs, B+/Negative) and IWH UK Finco Ltd
(Theramex, B/Stable), as well as the European generic drug
manufacturer Nidda Bondco GmbH (Stada, B/Stable).

Advanz's business model focuses not only on life-cycle and
intellectual property management of off-patent branded and generic
drugs, as is the case for Cheplapharm and Pharmanovia, but it is
also involved in bringing new niche, specialist and value-added
generics to market though co-development in-licencing and
distribution agreements. Therefore, in contrast to these two peers,
Advanz's future growth will be driven by both organic growth
opportunities related to the company's pipeline and inorganic
growth through acquisition of niche off-patent branded and generic
drugs.

Advanz has a structurally lower margin than Cheplapharm and
Pharmanovia, which is however still strong for the rating category.
This is partly driven by its decision to develop a sales channel in
certain therapeutic areas targeting European hospitals, which in
turn calls for higher in-house marketing and distribution expenses.
Its peer Theramex uses an even more targeted approach with in-house
sales capabilities focusing only on the women's health market,
which explains its lower margins.

All the ratings cited are constrained by small size and scale. The
ratings are differentiated by higher leverage for Advanz
post-refinancing than that for Cheplapharm and Atnahs, based on
Fitch-calculated FFO gross leverage. Compared with Stada's,
Advanz's rating reflects a weaker business risk profile due to
significantly smaller size and scale, which is however compensated
by a less aggressive financial policy and financial-risk profile.

KEY ASSUMPTIONS

Fitch's rating case is based on the following assumptions:

-- Revenue growth gradually improving and reaching low teens from
    2023, driven by mid-to-high single-digit organic revenue
    growth and acquisitions;

-- Fitch-defined EBITDA margins gradually moderating towards 35%
    by 2024;

-- Capex at 2%-2.5% of sales for 2022-2023;

-- Moderate working-capital outflows until 2024;

-- Annual acquisitions of USD300 million in 2022, and USD200
    million in 2023 and 2024;

-- No dividends, share buybacks nor equity injections for 2022-
    2023.

Fitch's Recovery Assumptions:

Advanz's recovery analysis is based on a going-concern (GC)
approach. This reflects the company's asset-light business model
supporting higher realisable values in financial distress compared
with balance-sheet liquidation. Distress could arise primarily from
material revenue-and-margin contraction, following volume losses
and price pressure, given its exposure to generic competition.

For the GC enterprise value (EV) calculation, Fitch estimates a
post-restructuring EBITDA of about USD195 million. This
post-restructuring GC EBITDA reflects organic earnings
post-distress and implementation of possible corrective measures.
The updated GC EBITDA also takes into account the annualised
contribution from acquisitions closed in 2021, and Fitch's
assumption that proceeds from the current debt issue will be
invested in inorganic growth in 2022.

Fitch applies a 5.5x distressed EV/EBITDA multiple, which would
appropriately reflect the company's minimum valuation multiple
before considering value added through portfolio and brand
management.

After deducting 10% for administrative claims, Fitch's principal
waterfall analysis generated a ranked recovery in the 'RR3'/56%
band for all senior secured instruments ranking equally among
themselves. Fitch does not expect this recovery rate to change as a
result of the announced debt issuance.

RATING SENSITIVITIES

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

Successful implementation of the organic growth strategy,
complemented by selective and carefully executed acquisitions
leading to:

-- EBITDA margin sustained at above 45%;

-- Continued strong cash generation with FCF margins comfortably
    in double digits;

-- Total debt with equity credit/operating EBITDA at or below
    5.0x, and FFO gross leverage sustained at or below 5.5x.

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

Unsuccessful implementation of the organic growth strategy and/or
acquisitions that lead to:

-- A sustained decline in EBITDA margins, translating into
    weakening cash generation, with FCF margins declining towards
    low single digits or zero;

-- Total debt with equity credit/operating EBITDA above 6.5x, and
    FFO gross leverage above 7.0x on a sustained basis.

BEST/WORST CASE RATING SCENARIO

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

LIQUIDITY AND DEBT STRUCTURE

Adequate Liquidity: Fitch views Advanz's liquidity position as
satisfactory, based on Fitch's projected readily available cash
position of around USD150 million, supported by an undrawn USD200
million revolving credit facility maturing in September 2027.
Following its 2021 debt refinancing, Advanz's capital structure
benefits from long-dated maturities, with no debt repayment until
March 2028.

ISSUER PROFILE

Advanz is a mid-sized, multi-national pharmaceutical company
operating in the generic and specialist drug space across various
therapeutic areas.


DERBY COUNTY FOOTBALL: Golden Share Likely to Be Suspended
----------------------------------------------------------
Peter Smith at DerbyshireLive reports that Derby County Football,
one of the 12 founding members of the Football League and two-time
champions, could be kicked out of the competition if they do not
prove funds to complete the season.

Derby FC is in administration and has already received a 21-point
penalty by the EFL, as well as being placed in a transfer embargo,
DerbyshireLive notes.

But The Sun claims that they could have their all-important golden
share suspended mid-way through the season unless they show funds
are in place by midday on Feb. 1, DerbyshireLive relates.

That would mean that all results and fixtures are expunged,
DerbyshireLive notes.

"This heavyweight threat emerged after administrators Quantuma were
unable to do a deal with the EFL to handle the claims of
Middlesbrough and Wycombe down the line," DerbyshireLive quotes
Alan Nixon as saying.

There are currently three parties bidding to take over Derby, who
were plunged into administration by Mel Morris in September,
DerbyshireLive states.

A consortium headed by former owner Andy Appleby; Sports Direct
boss Mike Ashley and a mystery third party are lining up to take
control, according to DerbyshireLive.


EDF ENERGY PLC: S&P Puts 'BB-' LongTerm ICR on Watch Negative
-------------------------------------------------------------
S&P Global Ratings placed on CreditWatch with negative
implications its 'BBB+' long-term rating on French integrated power
utility Electricite de France S.A. (EDF), 'BB+' long-term rating on
EDF Energy PLC and EDF Energy Customers PLC, as well as its 'BBB+'
issue rating on the group's senior unsecured bond and 'BB-' issue
rating on its junior subordinated debt.

The CreditWatch placement follows EDF's announcement on the outages
of its fleet and news of negative government intervention. On Jan.
13, 2022, EDF revised down its French nuclear output for 2022 to
300-330 terawatt hours (TWh) from 330-360 TWh. This stems from the
discovery of corrosion defects during maintenance checks on one
additional reactor (Penly), prolonging the outage periods at five
of EDF's 56 French nuclear reactors. S&P notes EDF is undergoing a
thorough review of its nuclear fleet that could lead to even lower
output for 2022, from its current assumptions. On the same day, the
French government announced its plans to increase the ARENH volumes
EDF delivers to other suppliers in 2022 by 20 TWh to 120 TWh. The
extra volume is set at a fixed price of EUR46.2/MWh (compared with
EUR42/MWh on the existing 100TWh). S&P said, "These extra volumes
are set to be delivered over April-December 2022, and we understand
that the increased volume is a one-off, unlikely to be rolled over
in 2023. We understand EDF will have to purchase significant
additional volumes of electricity on the market, in a very volatile
and materially high power price environment, while selling at much
lower contracted price." The government also announced that the
regulated customer yearly tariff increase for February 2022 will be
capped at 4%, with a postponement to February 2023 of any
additional increase. This may imply a EUR2 billion of additional
costs for EDF in 2022, to be recovered in 2023.

These developments could have a combined impact of EUR10
billion-EUR13 billion on EDF's reported EBITDA in 2022, compared
with the expectation of about EUR18 billion for the year. As a
result of the significant drop in profits, EDF announced the
suspension for 2022 of its financial policy target of net debt to
EBITDA below 3.0x and that it would present remedy measures
alongside its 2021 results on Feb. 18, 2022. S&P said, "Following
this profit warning, we expect EDF's 2022 credit metrics will
deteriorate markedly below the ranges we consider commensurate with
the current ratings. We also anticipate a significant increase in
S&P Global Ratings-adjusted debt since free cash flows will be
materially negative this year." The latter is due to an inflexible
investment program, with estimated capital expenditure of about
EUR17 billion for 2022.

Timely remedy measures will be critical to maintaining the current
rating. S&P said, "We note EDF has publicly stated that it will
announce remedy measures to mitigate the impact of the nuclear
outages on the company's profitability and credit metrics. In our
view, the magnitude of the announced profit warning warrants
extraordinary measures. Furthermore, there's a possibility that
downside risks will persist in 2023 since operational woes from the
nuclear fleet could extend into next year. Moreover, we note that
the delayed start of production at Flamanville 3 will reduce 2023
output. This suggests that, even if remedy measures are effective,
EDF is likely to face limited to no rating headroom in 2023,
ultimately resulting in a downgrade. Because we view the current
profit warning related to the negative state intervention as a
one-off, we see rating downside potential limited to one notch."

CreditWatch

The CreditWatch placement captures the risks related to prolonged
lower nuclear availability, a sharp EBITDA decline for 2022, and
the uncertainty on measures to restore EDF's credit metrics. S&P
said, "We expect to resolve the CreditWatch when we have more
clarity on the updated financial impacts, to be shared by the
company during its full year presentation on February 18. We will
also weigh in any announcement of potential remedy measures, from
the company or from the government, as well as any possible
government support."

S&P will also need greater visibility on EDF's industrial
performance over the short and medium term, notably:

-- The extent, timing, and length of nuclear outages.

-- How much electricity will be bought in the power markets
considering volatile market conditions and continuously upward
trending prices.

S&P will reassess its base case if EDF announces additional outages
as part of its annual review of the nuclear fleet. At this point in
time, S&P sees rating downside potential limited to one notch.


FERROGLOBE PLC: Moody's Alters Outlook on Caa1 CFR to Positive
--------------------------------------------------------------
Moody's Investors Service has affirmed Ferroglobe PLC's Caa1
corporate family rating and the company's Caa1-PD probability of
default rating. Concurrently, Moody's affirmed the Caa3 instrument
rating of Ferroglobe's $350 million backed senior unsecured notes
due in March 2022, the B2 instrument rating of the company's $60
million backed senior secured notes due in 2025, and the Caa2
rating of the $345 million backed senior secured notes due in 2025
both issued by Ferroglobe Finance Company, PLC. The outlook on all
ratings was changed to positive from stable.

RATINGS RATIONALE

The affirmation of the Caa1 CFR and Caa1-PD PDR ratings reflects
Moody's view that Ferroglobe's liquidity is currently not
commensurate with a higher rating despite improving profitability
and significantly upward adjusted base case projections for 2022.

Ferroglobe's Q3 2021 results affirmed that the company continues
its turnaround in terms of reported EBITDA generation with $35
million generated in Q3 2021 compared with $32 million in Q2 2021
and a loss of $12 million in Q3 2020. At the same time, the company
needed to invest materially into its working capital with an
associated cash outflow of $72 million in Q3 2021. Despite
additional liquidity of $60 million in Q3 2021 from the issuance of
$20 million of senior secured notes (this was the final tranche of
the $60 million senior secured notes) and $40 million of equity,
both part of the earlier exchange of the March 2022 notes, the
company's unrestricted cash balance reduced to $89 million at the
end of September 2021 from $100 million at the end of June 2021.
Moody's believes that Ferroglobe's liquidity likely needs to be
strengthened over the next few months to accommodate further
working capital requirements driven by rising raw material prices,
higher prices of the company's finished goods as well as rising
production volume.

Moody's has revised upward its base case projections for Ferroglobe
for 2022 driven by significantly higher prices of silicon metal,
silicon-based alloys, and manganese-based alloys. Especially
silicon metal prices have increased multiple times in recent months
and now stand at an all-time high level. Moody's believe that
Ferroglobe will start benefitting materially from these higher
price levels in 2022 when annual contracts at lower fixed prices
are being adjusted to the current high prices. Rising contracted
prices are expected to more than offset increasing production cost
driven by higher energy and raw material cost resulting in
substantially improving earnings in 2022-23.

Accordingly, Moody's forecasts the company's sales to rise by
around 40% to $2.3 billion from an estimated $1.6 billion in 2021
with Moody's adjusted EBITDA increasing to above $400 million from
an expected $150 million in 2021. Despite substantial working
capital cash outflow and higher capital investments than in recent
years, the rating agency projects Ferroglobe to achieve positive
free cash flow (FCF) generation in 2022. These projection result in
materially stronger credit metrics at year-end 2022 with Moody's
adjusted debt / EBITDA falling to around 2x from around 11x as of
the last twelve months (LTM) to September 2021.

Despite the forecast for positive FCF generation in 2022, Moody's
remains concerned about Ferroglobe's liquidity during the first
half of 2022 as the larger working capital might require funding at
the start of the year.

LIQUIDITY

Ferroglobe's liquidity remains weak despite the materially improved
debt maturity profile driven by the exchange of the March 2022 $350
million backed senior unsecured notes in 2021 with only around $5
million still outstanding. As of September 2021, the company
reported unrestricted cash and cash equivalents of only $89
million. The company does not have a committed credit facility.

Although the exchange of the notes alongside the injection of fresh
capital in 2021 improved Ferroglobe's liquidity to some extent and
despite the rating agency's projection of positive FCF generation
in 2022, Moody's still considers the company's liquidity position
as weak. This assessment is driven by the expected significant cash
outflow in H1 2022 related to working capital funding. As there is
a wide range of scenarios for the company's working capital
requirements in 2022, Moody's highlights that Ferroglobe might need
to raise additional capital to fund working capital.

STRUCTURAL CONSIDERATIONS

The B2 rating of the $60 million backed senior secured notes
reflects the senior ranking in the capital structure ahead of the
$345 million backed senior secured 2025 notes which are rated Caa2.
Ferroglobe's senior unsecured notes due in March 2022 are rated
Caa3, two notches below the CFR. This reflects the severe
subordination driven by the $60 million backed senior secured notes
as well as the $345 million backed senior secured notes, which both
rank senior to the 2022 notes. The B2 rating of the new $60 million
backed senior secured notes takes into account the possibility of
Ferroglobe entering into a new asset based loan which is permitted
under the debt documentation.

RATIONALE FOR OUTLOOK

The positive outlook reflects the gradual recovery of the company's
earnings during the first three quarters of 2021 and Moody's
expectation of a material improvement of Ferroglobe's financial
performance in 2022 driven by better market conditions and the
company's cost efficiency measures.

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

Positive pressure on the ratings could develop if the company:

Improves its operating profitability and credit metrics with
Moody's-adjusted gross debt/EBITDA falling to less than 6.0x and
positive free cash flow (FCF) generation on a sustained basis

further improves its liquidity position such that it can be
considered adequate

The ratings could be downgraded in case of a renewed market
downturn, preventing further meaningful recovery in the company's
profitability in the next twelve months. In particular, a downgrade
could be triggered if its Moody's-adjusted gross debt/EBITDA
remains above 8.0x for a prolonged period.

PRINCIPAL METHODOLOGY

The principal methodology used in these ratings was Manufacturing
published in September 2021.

COMPANY PROFILE

Headquartered in London, Ferroglobe PLC is a leading producer of
silicon metal and silicon/manganese alloys, with revenue of $1.1
billion in 2020. Ferroglobe, which is 49.3% owned by Grupo Villar
Mir, S.A.U. (Grupo Villar Mir), was formed in December 2015 through
the combination of the Europe-based Ferroatlantica, a subsidiary of
the Spanish Villar Mir industrial conglomerate, and the US-based
competitor Globe Specialty Metals Inc. The company is listed on the
NASDAQ and had a market capitalisation of $1.1 billion as of
January 13, 2022.


GRIBBLES BUTCHERS: Owes More Than GBP300,000 to Creditors
---------------------------------------------------------
William Telford at BusinessLive reports that an award-winning Devon
butcher's business which closed in late 2021 has left unpaid debts
of more than GBP300,000 -- with almost half owed to a London-based
fintech investment company.

Gribbles Butchers Ltd had shops in Plympton and Ivybridge, as well
as a farm base in Buckfastleigh, but in November 2021, bosses said
they had to take the difficult decision to close after 27 years in
business, BusinessLive relates.

At the time, management said the small team of eight people was
"physically and mentally beaten" by the Covid pandemic and its
restrictions so had decided to "take some time out" before "our
health is seriously affected", BusinessLive notes.

The business then closed and, after a meeting of creditors, went
into voluntary liquidation on December 7, appointing Henry Shinners
and Kevin Ley, of London's Smith and Williamson LLP, as joint
liquidators, BusinessLive discloses.

According to BusinessLive, documents newly filed at Companies House
now reveal Gribbles had debts of more than GBP400,000 with some
creditors unlikely to receive a penny.

The firm's assets amounted to GBP113,746, which was available to
pay off preferential creditors including the taxman, with HMRC owed
GBP10,023, and GBP17,365 in wages and holiday pay for staff.,
BusinessLive relays.  But when all preferential creditors are paid
it leaves just GBP20,271 available to pay unsecured creditors,
BusinessLive notes.

The total shortfall for creditors amounts to GBP305,371, a summary
of liabilities reveals, although a list of 33 creditors totals
claims of GBP320,201, BusinessLive discloses.


QUEENS HOTEL: Auction Scheduled for February 3
----------------------------------------------
Owen Hughes at BusinessLive reports that The Queens Hotel -- a
promninent Llandudno seafront hotel is set for auction next month
-- with a guide price similar to an average home in Wales.

The Queens Hotel shut during the pandemic after earlier falling
into administration with the collapse of Northern Powerhouse
Developments, run by Gavin Woodhouse, BusinessLive relates.

The site has remained shut since March 2020, BusinessLive notes.

Now the large Queens Hotel will be auctioned with Allsop next month
on behalf of the administrators, BusinessLive discloses.

It has a guide price of GBP200K to GBP250K -- which is remarkably
low for a 68 bedroom hotel on the famous seafront, according to
BusinessLive.  This compares to the average price of a home in
Wales of GBP203, 224 according to Land Registry, BusinessLive
states.

The reason is the complication of the leases attached to rooms at
the site which were taken on by investors in Northern Powerhouse
Developments, BusinessLive relays.

"The Administrators proposed an offer to the long leaseholders to
surrender their long leases, the majority of whom were receptive to
an offer," BusinessLive quotes Allsop as saying.

The hotel would come on a 2,000 year lease, BusinessLive notes.

The auctioneer added: "The property may lend itself to a variety of
alternative uses and redevelopment, subject to the existing long
leases and obtaining all the necessary consents."

The online auction takes place on Feb. 3, BusinessLive discloses.


RAINBOW UK 2: Moody's Assigns B2 CFR, Outlook Positive
------------------------------------------------------
Moody's Investors Service has assigned a B2 corporate family rating
and B2-PD probability of default rating to Rainbow UK MidCo 2 Ltd
(Wella or the company). The company is an intermediate holding
company within the Wella group formed for the purpose of the
acquisition of Coty's Professional Beauty business by funds
affiliated with KKR & Co. Inc. (KKR). Concurrently Moody's has
assigned B2 ratings to the proposed $1,800 million equivalent
(split in USD, EUR, GBP tranches) seven year guaranteed senior
secured term loan B (TLB) and to the pari passu ranking $300
million six and a half year guaranteed senior secured revolving
credit facility (RCF). The outlook on all the ratings is positive.

The TLB shall be issued by Rainbow Finco S.a r.l. and co-borrowed
by Wella US Operations LLC. The RCF shall be issued by Wella US
Operations LLC and co-borrowed by Wella Treasury Limited and
Rainbow UK Bidco Limited, all wholly-owned subsidiaries of the
company.

The proceeds of the TLB will be utilised, alongside $300 million of
payment-in-kind notes, to refinance the group's existing debt, make
a shareholder distribution and pay associated fees and expenses.

The rating reflects:

-- High pro forma Moody's adjusted leverage of 6.7x as of June
2021, pro forma for the proposed transaction, reducing towards 5x
in the next 12-18 months

-- A short track record as a standalone company

-- Solid expected cash flow generation before one-off separation
costs and an advanced programme for cost reduction and efficiency
gains.

RATINGS RATIONALE

Wella's B2 CFR is supported by: (1) the stable to growing but
highly competitive underlying market for hair and nail segments;
(2) the company's well-known brands and solid market position in
professional hair, a market with long-standing and deep client
relationships; (3) good channel and geographic diversity, which
have partly mitigated the sales decline during the pandemic and
ongoing shifts in consumer preferences; (4) opportunities for cost
savings and operational improvements from ongoing transformation
initiatives; and (5) expectations of deleveraging, with solid free
cash flow generation (after interest and non-recurring items) in
fiscal 2023, ending June.

The rating also reflects: (1) the company's relatively small scale
compared to larger and more diversified competitors, mitigated by
strong customer relationships and brands; (2) its short track
record of standalone performance and large separation costs,
mitigated by advanced execution of separation ; (3) a limited
historic track record in terms of revenue growth when excluding the
effects of the pandemic, which could indicate potential
vulnerabilities in terms of demand, particularly in the smaller
retail hair business; and (4) the company's high starting
Moody's-adjusted leverage of 6.7x at June 30, 2021 pro forma for
the proposed transaction.

The company's solid market position and long standing client
relationships in professional hair segment (representing
approximately 54% of consolidated revenue in fiscal 2021), and the
generally stable demand for hair and nail products provide a degree
of visibility into the forecasts.

Moody's forecasts that Wella will incur high non-recurring cash
costs in fiscal 2022, which will be funded through internally
generated cash flows and existing cash balances. Its free cash flow
generation is expected to improve thereafter to between $170-190
million annually on a Moody's adjusted basis after cash interest
and reduced non-recurring outflows. Interest expense will be the
largest cash outflow while capital expenditures will likely remain
limited around $60-70 million over the forecast period, mainly
relating to investments in the supply chain and information
technology.

However, Wella has a short history as a standalone company and
focused industry player, and visibility over the adequacy of
operating expenses and capex is somewhat limited.

LIQUIDITY

Wella's liquidity profile is adequate. The proposed refinancing
transaction is expected to leave approximately $75 million of cash
on balance sheet at closing and will provide access to a new $300
million guaranteed senior secured revolving credit facility due
2028, which will be undrawn at closing. The facility will have a
net senior leverage springing covenant tested when 40% net drawn,
under which the company will retain ample headroom. Moody's expects
the company to continue funding its large separation related
one-off costs through internally generated cash flows in fiscal
2022 and to generate significant positive free cash flow from
fiscal 2023 onwards.

STRUCTURAL CONSIDERATIONS

The B2 rating on the $1.8 billion (equivalent) guaranteed senior
secured term loan B and pari passu $300 million guaranteed senior
secured revolving credit facility are in line with the CFR,
reflecting the fact that they are the only debt instruments in the
capital structure. The senior facilities will be guaranteed by the
borrowers and material subsidiaries representing at least 80% of
consolidated EBITDA, subject to specific excluded jurisdictions,
and benefit from security over the assets of US and UK guarantors.

The use of PIK debt outside the restricted group and the need to
repay the instrument upon maturity creates a degree of structural
complexity and uncertainty regards the ultimate timing and source
of repayment.

ENVIRONMENTAL, SOCIAL AND GOVERNANCE CONSIDERATIONS

Moody's take the impact of environmental, social and governance
(ESG) factors into account when assessing companies' credit
quality. In particular Moody's considers governance risks within
the rating the fact that the company is currently majority owned by
funds controlled by KKR, which is expected to maintain a tolerance
for high leverage.

OUTLOOK

The positive outlook reflects Moody's view that Wella's revenue and
EBITDA will continue to grow over the next 12-18 months supported
by organic growth and cost reductions. As a result, Moody's expects
adjusted debt/EBITDA to reduce towards 5x by fiscal 2023. The
positive outlook also incorporates Moody's expectation that free
cash flow (FCF) after separation costs will turn significantly
positive during fiscal 2023, that liquidity will remain sufficient
to cover financial obligations and that no material debt-financed
acquisitions or distributions are undertaken which would slow the
expected pace of deleveraging.

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

The ratings could be upgraded if Wella (1) builds a successful
track record as a standalone business, supported by a longer
history of consolidated audited accounts, (2) Moody's adjusted
leverage reduces to below 5x and, (3) Moody's adjusted free cash
flow to debt improves towards the mid teens in percentage terms.

An upgrade would also require that the company achieves mid-single
digit organic revenue growth and growing EBITDA margins. In
addition, the company would need to demonstrate a financial policy
consistent with sustaining the above metrics and maintain at least
adequate liquidity.

The ratings could be downgraded if leverage fails to reduce below
6.5x on a Moody's-adjusted basis over the next 12-18 months, if
Moody's-adjusted free cash flow to debt trends towards zero, or if
there is a material decline in organic revenues or EBITDA margins.
A downgrade could also occur if liquidity concerns arise.

PRINCIPAL METHODOLOGY

The principal methodology used in these ratings was Consumer
Packaged Goods Methodology published in February 2020.

LIST OF AFFECTED RATINGS

Assignments:

Issuer: Rainbow Finco S.a r.l.

Senior Secured Bank Credit Facility, Assigned B2

Issuer: Rainbow UK MidCo 2 Ltd

Probability of Default Rating, Assigned B2-PD

LT Corporate Family Rating, Assigned B2

Issuer: Wella US Operations LLC

Senior Secured Bank Credit Facility, Assigned B2

Outlook Actions:

Issuer: Rainbow Finco S.a r.l.

Outlook, Assigned Positive

Issuer: Rainbow UK MidCo 2 Ltd

Outlook, Assigned Positive

Issuer: Wella US Operations LLC

Outlook, Assigned Positive

COMPANY PROFILE

The company was formed in December 2020 following the spin-off of
the professional beauty products retail business from Coty Inc.,
with Rainbow JVCo Limited, an intermediate holding company
ultimately majority-owned by funds affiliated with KKR & Co. Inc.
As the company is currently transitioning to a standalone business,
several interdependencies with Coty Inc. remain. The Wella Company
manufactures and distributes hair and nail products and hair
appliances (styling tools, hair dryers and curlers) for
professional and consumer use through an extensive network of
professional salons, wholesalers, retailers and e-commerce
platforms, including its own websites. The company generated
revenue of $2.3 billion in fiscal 2021, ended June 30.


RAINBOW UK 2: S&P Assigns Preliminary 'B' ICR, Outlook Stable
-------------------------------------------------------------
S&P Global Ratings assigned its preliminary 'B' ratings to Rainbow
UK MidCo 2 Ltd. (the parent of the Wella group, which will produce
consolidated accounts) and to the proposed senior secured $1.8
billion term loan B due 2029 and $300 million RCF due 2028.

The stable outlook indicates that Wella has sufficient rating
headroom within its credit metrics, prospects for gradual
deleveraging, and robust annual free operating cash flow (FOCF) of
$150 million-$200 million or higher.

During 2021, financial sponsor KKR & Co. Inc. increased its
controlling equity stake in Wella to 74%, from the 60% it acquired
in 2020 following the carve-out of Wella from Coty Inc. The
remaining 26% equity stake in Wella is owned by Coty.

Wella has good diversity overall in terms of region, customer base,
and channel distribution. The group operates in more than 100
countries with a relatively well-balanced exposure among key
regions. North America represents the largest contributor, with
about 28% of sales in fiscal year (FY) ending June 30, 2021, while
the top three regions (North America; Germany, Austria, and
Switzerland; and the U.K. and Ireland) account for about 50% of
total revenue. The group is well diversified, with exposure to
several different segments (including hair salons, wholesale,
e-commerce, and retailers), while Wella's top 10 customers account
for less than 20% of total group sales. It has a relatively low
exposure to emerging markets compared with key global competitors,
although these markets could represent future business
opportunities. Sales are also well balanced in terms of brands and
route-to-market, with wholesale accounting for 34% of sales; salons
30%; consumer retailers 16%; pure e-commerce players 8%; and other
channels 12%. By product category, the group is focused mainly on
hair products (about 74% of sales) covering both professional (No.
2 hair professional player globally) and retail (No. 2 in retail
hair color). In addition to hair products, Wella has a beauty tech
division (16% of total sales) with the GHD brand, and a
professional nail division (8% of sales). Finally, S&P views
positively Wella's operation across different price points in the
medium to premium space.

The group has strong established market shares globally. Wella is
the No. 2 global player in the professional hair and retail hair
color segments, and the No.1 global player in professional hair
color, professional nail care, and premium hair-styling appliances.
According to Kline & Company, Inc., provider of market research and
databases for consumer, industrial and professional markets, within
the professional hair segment (a core business for Wella), L'Oreal
is the clear market leader with an estimated global market share of
about 20%-25%. Wella is the No. 2 player after L'Oreal, with an
estimated market share of slightly below 10%, followed by Henkel
(A/Stable/A-1). Wella lost about 140 basis points (bps) during the
period 2016-2020. The group is underexposed to the professional
hair care segment (care represents about 45% of the total
professional hair industry, but accounts for only 29% of Wella's
professional hair segment) with a market share of about 6%, being
the No. 3 industry player. The group has seen a slight decline in
its market shares (except for hair appliances) in the past few
years, mainly due to the lack of focus under previous ownership, as
well as insufficient exposure to the fastest-growing emerging
markets and the hair care segment (as opposed to hair color and
stylist hair products). For example, until October 2021, Wella had
historically been restricted from selling its hair care products
within the retail channel as part of legacy agreements with other
companies.

The beauty industry has long-term growth drivers, although the hair
segment has experienced lower growth compared with other beauty
categories. According to Wella, its global addressable market is
close to $100 billion (about 20% of the total beauty and personal
care market) given its focus on hair, nail, and hair beauty tech
products (hair dryer, stylers, curlers). The global hair industry
(professional and retail) has a value of close to $85 billion, and
it experienced a compound annual growth rate (CAGR) of about 1.5%
(professional hair CAGR 2015-2019 of 3% and retail hair close to
1.2%) over 2015-2019 (excluding 2020 due to the pandemic). S&P
said, "This is below our view of the global average estimated
growth rate for the beauty industry of close to 5% over the same
period. In our view, hair products are a more mature segment than
other beauty products (such as skincare and fragrance). Moreover,
the level of innovation and speed of premiumization within the hair
industry has been lower over the past few years. That said, the
industry is characterized by positive long-term growth drivers
including, for example, a rising middle class in emerging markets,
increased care and wellbeing consumer awareness, digital
activities, and the premiumization trend. We expect
low-to-mid-single-digit growth in the group's addressable market
during 2022-2025."

The COVID-19 pandemic caused significant disruption to the beauty
industry--primarily to the professional beauty segment--creating
additional volatility. During FY2020, Wella posted revenue of $2.1
billion, representing a year-on-year revenue decline of 12%. The
decline stemmed mainly from the professional hair segment and the
OPI brand (about 16% reduction in sales) due to salon closures and
reduced social occasions. All of the group's business segments
posted negative growth, except for hair appliances (with its
premium brand GHD), which grew by 3% thanks to strong e-commerce
channel exposure. Moreover, during FY2020, Wella lost about 400 bps
in S&P company-adjusted EBITDA, despite a material reduction in
advertising and consumer promotion expenses. In FY2021, Wella
posted 10% annual revenue growth thanks to the gradual reopening of
salons, although total revenue remained below the pre-pandemic
level (at about 3.6% below FY2019). During the pandemic, the
closure of salons did not translate into a positive performance for
the retail channel. In fact, hair retail (20% of total sales in
FY2021) is expected to remain below pre-pandemic levels in FY2022.
Finally, the pandemic strongly accelerated the shift to e-commerce,
as seen with other personal care and beauty players. The group
estimates that online sales account for about 18% of total
revenue.

S&P said, "We consider the industry's barriers to entry to be
moderate and competition intense. The top three players (L'Oreal,
Wella, and Henkel) account for about 40% of the global professional
hair industry. In our view, the industry barriers are moderate
considering the relevance of brand reputation, long-term
relationships with hair salons (educational programs, contract
agreements, and so on), and research and development (R&D)
activities." However, in the recent past, the industry experienced
a general step-up in competition, mainly because of higher online
penetration, new brands, and product launches, combined with
increased marketing and promotional activities.

Historically, Wella's profitability is lower than its direct peers,
although looking ahead we expect moderate improvements. Because of
the carve-out transaction, we do not have a complete track record
of Wella's reported EBITDA margin for the company on a stand-alone
basis. However, according to the pro forma adjustments, the group
posted an S&P Global Ratings-adjusted EBITDA margin (including
lease) in the 10%-15% range over the past few years, below its
direct peers. This was mainly the result of some pandemic-related
disruptions, the underutilization of its own manufacturing
facilities, and some suboptimal level price levels and product mix.
S&P said, "Given the renewed strategic growth plan and new
management team, we expect the company to report moderate and
gradual improvements in its profitability, with an expected S&P
Global Ratings-adjusted EBITDA margin approaching 16% in 2023-2024.
The group has an improved operating leverage and efficiency
program. Moreover, it is implementing some cost-saving initiatives
(commercial negotiation, production relocation, change in sourcing
activities) for an estimated total saving of close to $170 million
by FY2025. However, we expect these initiatives to have a more
limited positive impact on the income statement given the
offsetting actions of higher raw material and transportation costs,
and because some of the savings will be reinvested."

According to the management, the company is on track to complete
the separation from Coty by February 2022. One key exception is
Brazil, where separation complexity is higher, and where Wella
entered into a distribution agreement with Coty for the first three
years post-closing. The overall separation process started in
FY2021, with total one-off spending expected to be close to $430
million-$450 million. According to the management, about $300
million has already been incurred as of November 2021. S&P said,
"In our base-case scenario, in line with the group's guidance, we
assume about $250 million one-off separation costs in FY2022, $19
million in FY2023, and $13 million in 2024. Most of the one-off
separation costs relate to IT activities, such as cloning Coty's
systems and software applications and implementing a new IT
infrastructure stand-alone platform. Other one-off separation costs
include consulting expenses, legal costs, taxes, and so on. In our
assessment, considering the nature of these separation costs, we
exclude these one-offs from our adjusted EBITDA figure." Given that
the group has put in place a robust separation process and that
most of the spending has already taken place, there is a relatively
lower event risk associated with higher spending related to
separation with a negative impact on the company's net cash flow
generation.

S&P said, "We expect Wella to report a healthy recurring cash flow
generation, with annual FOCF (after working capital and capital
expenditure [capex] requirements) in the range of $150 million-$200
million during 2022-2023. Cash flow figures under our base case
represent a significant reduction compared with the group's
base-case scenario. This is mainly led by a more conservative
approach in terms of EBITDA margin evolution. We anticipate annual
capex to amount to about $70 million, at about 2.5% of annual
sales. Looking at working capital, we assume a moderate cash
absorption to support organic top-line growth. At end-FY2022, the
overall cash position of the company will be affected by the
significant one-off costs (about $250 million) associated with the
separation from Coty.

"Under our base case, we estimate that Wella will post adjusted
debt to EBITDA in the 6.5x-6.0x range at year-end 2022, with a
gradual deleveraging thereafter. We expect the company to
deleverage close or below 6.0x and to maintain adjusted leverage
within 6.0x-5.5x during 2023-2024. The deleveraging trend is driven
by a moderate increase in EBITDA thanks to organic revenue growth,
the phasing out of restructuring costs, and some cost-saving
initiatives implemented by the group. Total adjusted debt includes
an approximately $1.8 billion term loan B, $300 million PIK notes
(with accrued interest), operating leasing of about $80 million-$85
million, and about $110 million of net pension liabilities. In our
adjusted EBITDA, we exclude the separation costs (about $250
million in 2022, $19 million in 2023, and $13 million in 2024) and
we include transformative restructuring expenses, expected to
amount to $50 million over 2023-2025. The group is implementing a
transformative restructuring program for a total expected
consideration of $90 million-$95 million (operating expenditure and
capex), of which about 50% will already be spent by end-FY2022.
These investments relate, among other things, to procurement
projects, centralization of human resources functions, severance
costs, and real estate optimization.

"The stable outlook indicates that we expect Wella to post positive
organic growth with a gradual improvement in EBITDA margin
approaching 15%-16% on an S&P Global Ratings-adjusted basis. The
improvement is mainly driven by the group's cost-saving
initiatives, the phasing out of restructuring costs, and the
ongoing premiumization trend within the beauty industry. Under our
base-case scenario, we expect the group to post annual FOCF in the
range of $150 million-$200 million and to be able to reduce the
adjusted debt-to-EBITDA ratio close to 6.0x by FY2023.

"We could lower the rating if the group's S&P Global
Ratings-adjusted debt to EBITDA rose above 7.0x on a sustainable
basis with a much lower FOCF than anticipated. For example, this
scenario could stem from significant and prolonged pandemic-related
disruptions, a weaker macroeconomic environment in the group's key
markets, combined with business disruption and higher spending
related to the separation from Coty.

"We could upgrade Wella if the group were able to outperform our
base case so that it is able to gain significant market share with
material improvement in its S&P Global Ratings-adjusted EBITDA
margin. Under this scenario, Wella should demonstrate a track
record of operating successfully on a stand-alone basis (post
separation) with solid FOCF generation and the ability to achieve
and maintain S&P Global Ratings-adjusted debt to EBITDA close to or
below 5.0x."  

ESG credit indicators: E-2 S-2 G-3

S&P said, "Governance factors are a moderately negative
consideration in our rating analysis of Rainbow UK Midco 2 Ltd., as
is the case for most rated entities owned by private-equity
sponsors. We believe the group's highly leveraged financial risk
profile points to corporate decision making that prioritizes the
interests of the controlling owners. This also reflects the
generally finite holding periods and a focus on maximizing
shareholder returns."


STRATTON BTL 2022-1: S&P Assigns Prelim. B- Rating on X2 Certs
--------------------------------------------------------------
S&P Global Ratings has assigned preliminary ratings to Stratton BTL
Mortgage Funding 2022-1 PLC's class A, class X1, and class X2
notes, and class B-Dfrd to D-Dfrd interest deferrable notes. At
closing, the issuer will also issue unrated RC1 and RC2
certificates.

Stratton BTL 2022-1 PLC is a static RMBS transaction that
securitizes a portfolio of GBP449.5 million buy-to-let (BTL)
mortgage loans secured on properties located in the U.K. The loans
in the pool were entirely originated by Landbay Partners Ltd.
between 2017 and 2021.

At closing, the issuer will use the issuance proceeds to purchase
the full beneficial interest in the mortgage loans from the seller.
The issuer will grant security over all of its assets in favor of
the security trustee.

S&P considers the collateral to be prime, based on the overall
historical performance of Landbay Partners' BTL residential
mortgage books as of November 2021, the originator's conservative
lending criteria, and the very minimal number of loans in arrears
in the securitized pool.

Credit enhancement for the rated notes will comprise subordination
from the closing date and overcollateralization (OC), which will
result from the release of the general reserve excess amount to the
principal priority of payments.

The class A notes will benefit from liquidity support from both a
liquidity and general reserve fund, and will have the ability to
use principal to pay interest unconditionally. The class B-Dfrd
notes will benefit from liquidity support provided by both the
liquidity and general reserve fund, and the ability to use
principal subject to their principal deficiency ledger (PDL) not
exceeding 25% of their outstanding balance or being the most senior
note outstanding. Finally, the class C-Dfrd and D-Dfrd notes will
benefit from liquidity support from the general reserve fund only,
provided that the respective tranche's PDL does not exceed 0% of
each tranche's outstanding balance or it is the most senior note
outstanding, and the ability to use principal to cover interest
shortfalls only when the tranches are the most senior outstanding.

There are no rating constraints in the transaction under S&P's
counterparty, operational risk, or structured finance sovereign
risk criteria. It considers the issuer to be bankruptcy remote.

  Preliminary Ratings

  CLASS   PRELIMINARY RATING    CLASS SIZE (%)§
   A           AAA (sf)              87.00
   B-Dfrd      AA (sf)                6.50
   C-Dfrd      A- (sf)                4.00
   D-Dfrd      BBB- (sf)              2.50
   X1          B(sf)                  3.00
   X2          B- (sf)                1.75
   RC1 certs   NR                      N/A
   RC2 certs   NR                      N/A

  N/R--Not rated.
  N/A--Not applicable.


THOMAS COOK: Former Directors Cleared of Wrongdoing by Regulator
----------------------------------------------------------------
Mark Kleinman at Sky News reports that former directors of Thomas
Cook, one of Britain's biggest travel companies, are to be formally
cleared of wrongdoing by the government's bankruptcy watchdog after
a probe lasting more than two years.

Sky News has learnt that the Insolvency Service has concluded its
investigation into the collapse of Thomas Cook, which was forced
into compulsory liquidation in September 2019 after the failure of
last-ditch rescue talks.

Full details of the Insolvency Service's conclusions were unclear
on Jan. 12, but one source close to the process said it had decided
there was no basis for further action against the tour operator's
bosses, Sky News relates.

The development comes just under nine months before a statutory
three-year deadline for the watchdog to complete its inquiry, Sky
News notes.

According to Sky News, in a letter to the Insolvency Service on the
day of Thomas Cook's collapse, Andrea Leadsom, the then business
secretary, urged it to treat the inquiry as a priority, "given the
significance of this case and its implications for thousands of
customers and employees"

It was unclear on Jan. 12 whether the inquiry's scrutiny of Thomas
Cook's former directors, which examined issues such as whether the
company had traded while insolvent or issued misleading financial
statements, had raised any meaningful concerns, Sky News states.

The collapse of Thomas Cook followed months of frantic talks aimed
at raising hundreds of millions of pounds of funding to keep it
afloat, Sky News notes.

Its liquidation triggered thousands of job losses and a huge
repatriation effort led by the Civil Aviation Authority which was
the largest of its kind in peacetime, Sky News recounts.

According to Sky News, the anticipated exoneration of the travel
agent's board members will come as a relief to the likes of Peter
Fankhauser, Thomas Cook's chief executive at the time of its
collapse.


ZEUS BIDCO: Moody's Assigns First Time 'B1' CFR, Outlook Stable
---------------------------------------------------------------
Moody's has assigned a first time B1 long-term Corporate Family
Rating to Zeus Bidco Limited (Zenith), and B1 rating to the GBP475
million fixed rate senior secured notes to be issued out of Zenith
Finco Plc. The issuers' outlook is stable.

RATINGS RATIONALE

The CFR of B1 reflects Zenith's moderate size, steady and good
level of cash flow generation, and solid debt servicing capacity,
relatively high leverage, and moderate liquidity profile. Overall,
the rating agency views Zenith's operating environment in the
United Kingdom's vehicle finance sector as highly competitive and
assigns a Ba operating environment score, reflecting the fact that
larger captive auto finance companies as well as banks compete with
Zenith on pricing and customer relationships.

Zenith has an established track record of stable and primarily
organic growth, and effective risk management as well as a
diversified franchise across its funded and managed fleet business
and various lessees. Its business has been based on a long
standing, primarily high credit quality corporate client base to
whom there is limited concentration risk. These factors have so far
underpinned its steady performance which Moody's expects will
continue to support its growth aspirations.

The negative net income and tangible common equity, constrained by
sizeable non-cash items, goodwill and intangibles, are not an
impediment to the running of the business because the company
largely depends on its cash flow to cover capital spending and to
service debt. In addition, Zenith has strong residual value risk
management practices and a proven track record in this area which
moderates the risk to earnings and the balance sheet.

On the other hand, Zenith's CFR is weighed down by its elevated
leverage. This is captured by the issuers' relatively high debt to
EBITDA, and moderate funds from operations to debt indicators,
despite good cash flow generation. Moody's expects these indicators
to improve only modestly over the next 12 to 18 months. The pending
issuance of new secured debt and the new super senior secured
revolving credit facility (RCF) will extend Zenith's funding
maturity profile reducing refinancing risk but will also continue
to contribute to Zenith's high asset encumbrance.

In terms of governance, which is highly relevant to all finance
companies, Zenith benefits from an experienced and long-standing
management team. Thus, Moody's has no particular governance
concerns in relation to Zenith. Nonetheless, corporate governance
remains a key credit consideration and requires ongoing monitoring,
as is the case for all financial institutions.

The B1 rating assigned to the senior secured debt issuances of
Zenith Finco Plc reflects the application of Moody's Loss Given
Default for Speculative-Grade Companies methodology (LGD)
(published in December 2015) and the priorities of claims in the
proposed liability structure post the refinancing. The new capital
structure contemplates the issuance of GBP475 million fixed rate
senior secured debt, and a new GBP65 million Revolving Credit
Facility (RCF). Moody's expects that the credit facility will be
undrawn at the time of the transaction, but that its utilisation
will vary in accordance with business needs. Whilst the RCF is
senior to the secured notes, its moderate amount does not result in
a material increase in the estimated expected loss for the senior
secured notes. Thus, in accordance with Moody's LGD analysis, the
senior secured notes are assigned a rating of B1 in line with the
B1 CFR.

OUTLOOK

The stable outlook reflects Moody's expectation that Zenith's
credit fundamentals and capital structure will largely remain
steady benefiting from the improved operating environment, strong
free cash flow generation from underlying operations, reduced
refinancing risk from the longer-term maturities of the new debt
and access to liquidity via undrawn securitisation and revolving
credit facilities.

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

The CFR could be upgraded if Zenith (i) improves its cashflow
generation, profitability and debt servicing capacity, (ii)
deleverages so that debt / EBITDA is maintained below 3.5; and/or
(iii) improves its liquidity profile with significantly lower
secured debt reliance and higher cashflow generation relative to
its outstanding debt. An upgrade of the CFR would likely result in
an upgrade of all ratings. The senior secured debt ratings could
also be upgraded if there were significant changes in the liability
structure, which would result in an increase in its expected
recovery in a default scenario.

The CFR could be downgraded if the company (i) were unable to
maintain its cash flow generation; (ii) fails to maintain a
sustainable profitability; and/or (iii) significantly increases its
leverage for a prolonged time while consuming its cash balances.
Additionally, the CFR could be downgraded if the prudent residual
value management and risk appetite or its leading market position
weaken deviating from its historical track record. The senior
secured debt ratings could also be downgraded if there were
significant changes in the liability structure, which would result
in a decrease in expected recoveries for secured creditors in a
default scenario or following the downgrade of the CFR.

LIST OF AFFECTED RATINGS

Issuer: Zeus Bidco Limited

Assignment:

Long-term Corporate Family Rating, assigned B1

Outlook Action:

Outlook assigned Stable

Issuer: Zenith Finco Plc

Assignment:

Senior Secured Regular Bond/Debenture, assigned B1

Outlook Action:

Outlook assigned Stable

PRINCIPAL METHODOLOGY

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


ZEUS BIDCO: S&P Assigns 'B+' Issuer Credit Rating, Outlook Stable
-----------------------------------------------------------------
S&P Global Ratings assigned its 'B+' long-term issuer credit rating
to U.K.-based mobility services provider Zeus Bidco Ltd. (Zeus).
The outlook is stable.

S&P said, "At the same time, we assigned our 'B+' issue rating and
'4' recovery rating to the proposed senior secured notes to be
issued by Zenith Finco PLC. The recovery rating indicates our
expectation of average recovery (30%-50%; rounded estimate: 35%) in
the event of a payment default.

"Our rating on Zeus, which is wholly owned by Zenith Automotive
Holdings Ltd. (Zenith), reflects our view of the Zenith group's
consistent track record in the mobility services sector. Other
supporting factors are Zenith's highly visible long-term income
streams and its resilience to market turbulence due to events such
as the COVID-19 pandemic. However, our rating is constrained by
Zenith's smaller scale than that of its global peers, its
aggressive growth plans, and its financial sponsor ownership.

"Our rating assessment is based on the group credit profile for the
consolidated activities of the Zenith group. This is because we do
not foresee any material barriers preventing cash flowing from the
operating subsidiary to the nonoperating holding company (NOHC).
The entity we rate, Zeus, is an operating company owned by the NOHC
Zenith, which is jointly owned by management and Bridgepoint, a
leading private equity firm in the European mid-market. Bridgepoint
acquired Zenith in 2017 and it is the fourth-largest investment in
the Bridgepoint Europe Fund V. We understand that Bridgepoint has
no immediate exit plans.

Zenith's business position is supported by its highly visible
income streams and longstanding leading position in the U.K.
leasing market. Although Zenith has less geographical
diversification than its peers, as it focuses on the U.K, it has a
well-diversified client base across various industries. It has
around 150,000 vehicles under management and specializes in
providing bespoke services in three divisions, corporate,
commercial, and consumer. Customers appear to be sticky, with an
average tenure of 11 years among the largest customers. S&P thinks
that Zenith adequately manages regulatory compliance risk within
the consumer business, business outsourcing, the personal car
leasing company ZenAuto, and corporate employee car-ownership
schemes. Zenith's compliance team monitors activities and arranges
training for employees on regulatory risk.

S&P said, "The rating factors in our expectation of comfortable
interest-coverage metrics, as well as the risks inherent to
financial sponsor ownership and an aggressive growth strategy.
Zenith's EBIT interest coverage was 1.2x in the financial year
ending March 31, 2021, and we expect it to improve moderately and
remain comfortably above 1.1x. We adjust EBIT to add back the
amortization of intangibles and goodwill as these are noncash, and
to make the metrics comparable with those of peers. Our forecast
factors in the significant fleet growth that management plans and
that it will finance largely with available committed
securitization facilities with a pool of banks and other wholesale
funding lines. While we expect Zenith's absolute debt to grow, we
anticipate that it will maintain comfortable interest-coverage
metrics given the medium-term nature of its contracts. We assume
that Zenith will refinance its GBP434 million term loan maturing in
2024 with the proceeds of the senior secured notes over the coming
year. We also assume that it will refinance its GBP60 million
revolving credit facility (RCF) with a new GBP65 million RCF, which
we expect to remain undrawn. The group also has a number of
securitization facilities and other wholesale funding lines
totaling GBP1.2 billion, of which GBP415 million is currently
undrawn. These facilities are secured against Zenith's fleet, while
the residual value risk remains with Zenith. In our metrics we
treat the loan notes and preference shares provided by the
financial sponsor as equity, as these are subordinated to all other
forms of debt, do not require fixed periodic payments, and mature
after all other forms of debt. For more information, see "The
Treatment Of Non-Common Equity Financing In Nonfinancial Corporate
Entities," published April 30, 2018.

"Zenith is 73% owned by a financial sponsor, Bridgepoint, with the
rest of the shares in the hands of management. We factor this into
our FS-5 financial policy and aggressive financial risk profile
assessments. We factor into our negative comparable rating
adjustment risks relating to the group's ambitious growth plans, as
well as its moderate scale compared to peers in the same sector
such as ALD S.A. (BBB/Stable/A-2) and Element Fleet Management
Corp. (BBB/Stable).

"Leasing, in which some financial services finance companies
(FSFCs) engage significantly, is a capital-intensive business with
high depreciation and amortization expenses. This limits the
usefulness of EBITDA, and sometimes funds from operations
(FFO)-based leverage and cash flow metrics, both core ratios in our
corporate methodology. We therefore apply a criteria exception to
divert from the parameters of profitability, financial risk,
capital structure, financial policy, and liquidity laid out in our
corporate methodology for FSFCs engaged in leasing. To gain a more
meaningful insight into the business and financial risk of relevant
FSFCs, we analyze profitability based on EBIT and the EBIT margin,
and financial risk based on cash flow leverage metrics, such as
EBIT interest coverage and debt to total capital. We believe that
these alternative ratios more appropriately measure the risks
associated with leasing operations by avoiding the distortion
created by the typically high depreciation expenses. We do not
apply our operating lease criteria in their entirety to these FSFCs
because sufficient differences remain between the FSFCs that
warrant the criteria exception, and those that are in scope of our
operating lease criteria. These differences warrant additional
considerations, like the nature of the entity's activities and its
operating environment, including industry risk, competitive
position weightings, and, in certain cases, significant fee-related
services, funding from a bank parent, and residual value or credit
risk.

"Like its peers, Zenith is exposed to residual value risk, which is
inherent to the leasing business model. We believe that government
measures and initiatives in the U.K. and elsewhere to support the
auto industry by incentivizing the use of electric and hybrid
vehicles may accelerate trends and catalyze risks. While the
current supply chain disruptions and a prolonged period of
undersupply support car prices in the second-hand car markets, an
accelerated transition toward electric and hybrid vehicles in the
U.K. is likely to weigh on the residual value of the nonelectric
fleet. That said, we consider that Zenith has a good track record
in monitoring residual value risk, supported by the diversification
of its fleet.

"The stable outlook over our 12-month horizon incorporates our
expectation that Zenith will maintain its stable performance and
strategic focus on expanding its electric vehicle fleet and growing
ancillary revenue. We expect that Zenith will manage to withstand
further market volatility due to the pandemic while maintaining its
financial ratios within our rating thresholds.

"Although we do not expect to do so in the next 12 months, we could
lower the rating if Zenith's financial metrics weaken, with EBIT
interest coverage dropping below 1.1x. This could occur if Zenith
raises more debt than we anticipate to finance its growth, or if it
raises it on more expensive terms. We could also lower the rating
if we see that residual value risk is becoming a threat to the
business, or if competition lowers the attractiveness of Zenith's
offering, weakening its market share and profitability.

"We could take a positive rating action in the next couple of years
if Zenith manages to implement its growth plans while maintaining
EBIT interest coverage comfortably above 1.3x on a sustainable
basis.

"We view Zenith's liquidity as adequate. In our base-case scenario,
we anticipate that liquidity sources will exceed uses by at least
1.2x over the next 12 months. The planned refinancing of the GBP434
million loan maturing in 2024 with the proposed GBP475 million
notes issuance does not have a major effect on liquidity but
improves the group's debt maturity profile."

S&P expects that the principal liquidity sources over the next 12
months will be:

-- Approximately GBP24 million of cash on the balance sheet;

-- Availability of GBP65 million under the RCF and GBP415 million
undrawn under the securitization and wholesale funding lines; and

-- Working capital inflows, leased car sales, and FFO.

S&P expects that the principal liquidity uses over the same period
will be:

-- Negative free cash flow stemming from high capital expenditure
(capex) to finance the planned expansion of the fleet. S&P expects
Zenith to cover this principally with its securitization and
wholesale funding facilities. S&P also takes comfort from the fact
that this capex is discretionary and may be curtailed if
necessary.

Debt maturities

-- 2026: GBP725 million in securitization facilities, with the
last possible drawdown in 2024

-- 2027: Proposed GBP475 million secured notes

-- 2027: Proposed GBP65 million RCF

-- The issue and recovery ratings on the proposed GBP475 million
secured notes due in 2027, to be issued by Zenith Finco PLC, are
'B+' and '4', respectively.

-- The '4' recovery rating reflects S&P's expectation of average
recovery prospects at the lower end of the 30%-50% range (rounded
estimate: 35%). The recovery rating is largely constrained by the
presence of the priority-ranking securitization and wholesale
facilities on the balance sheet.

-- S&P assumes that after default, the group would be restructured
as a going concern, thanks to its position as a leading mobility
service provider in the U.K. market.

-- S&P derives the valuation using a combination approach, whereby
it uses an EBITDA multiple valuation to derive the value from the
services and fleet management business, and a depreciated asset
valuation to assign a value to the on-balance-sheet vehicle fleet
and respective securitization.

-- The GBP65 million super senior RCF ranks ahead of the notes, and
S&P assumes that 85% of the RCF will be drawn at default.

-- The securitization facilities have priority claims in the
waterfall, and S&P assumes that 60% of these facilities will be
drawn at default, largely covered by the assets pledged to the
facilities.

-- Year of default: 2025

-- Jurisdiction: U.K.

-- Net enterprise value after 5% administrative claims: GBP944.7
million

-- Priority claims: GBP760.1 million

-- Collateral available: GBP184.6 million

-- Secured debt*: GBP485.5 million

    --Recovery expectation: 30%-50% (rounded estimate: 35%)

*All debt amounts include six months of prepetition interest.

Ratings Score Snapshot

-- Issuer Credit Rating: B+/Stable/--
-- Business risk: Fair
-- Country risk: Low
-- Industry risk: Moderately high
-- Competitive position: Fair
-- Financial risk: Aggressive
-- Cash flow/Leverage: Aggressive
-- Anchor: bb-

Modifiers

-- Diversification/Portfolio effect: Neutral (no impact)
-- Capital structure: Neutral (no impact)
-- Financial policy: FS-5
-- Liquidity: Adequate (no impact)
-- Management and governance: Fair (no impact)
-- Comparable rating analysis: Negative (-1)
-- Group credit profile: 'b+'


[*] UK: Hundreds of Construction Firms Going Bust Every Month
-------------------------------------------------------------
Gill Plimmer and George Hammond at The Financial Times report that
hundreds of UK construction businesses are going bust every month
as materials prices have risen and the pool of skilled workers has
shrunk after Brexit.

An average of 266 businesses per month collapsed in the three
months to October, the largest number since before the pandemic and
a 29% rise on the previous period, the FT relays, citing the latest
Insolvency Service data.

According to the FT, Noble Francis, economics director at the
Construction Products Association, said the problems were likely to
accelerate for some small specialist subcontractors that had been
"hit with the full force of supply problems".  He said costs were
continuing to rise, delaying projects and affecting revenue
streams, the FT notes.

Despite demand for building reaching record levels, supply chain
blockages have meant contractors have been hit by rising costs for
materials including timber, steel and cement, which they have not
always been able to pass on to clients the FT disclosew.  A lack of
skilled workers after Brexit has also pushed up wages, the FT
states.

Housebuilders have predicted that costs will rise at least 5% as a
result of the disruption, some of which could be passed on to
consumers in the form of house price inflation, the FT relates.

According to the FT, Rebecca Dacre, partner at consultancy Mazars,
said: "Building contractors are being hit from all sides.  Supply
chain chaos, spiralling inflation and a vanishing pool of workers
are combining to ramp up the financial pressure on them. For some
the burden is too much and this is pushing them under."

Larger builders have typically been able to navigate the
disruption, with their scale affording them greater bargaining
power.  But small and medium-sized developers have had a harder
time, according to industry analysts.

Ms. Dacre said other issues affecting businesses included
overtrading, where contractors took on too much work too quickly
without having the cash flow to complete.



                           *********


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,
Julie Anne L. Toledo, Ivy B. Magdadaro, and Peter A. Chapman,
Editors.

Copyright 2022.  All rights reserved.  ISSN 1529-2754.

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