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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

          Tuesday, December 27, 2022, Vol. 23, No. 252

                           Headlines



G E R M A N Y

THYSSENKRUPP AG: Egan-Jones Retains BB- Senior Unsecured Ratings


L U X E M B O U R G

ALTISOURCE PORTFOLIO: Egan-Jones Retains CCC+ Sr. Unsec. Ratings


R O M A N I A

BLUE AIR: Romania Takes Over 75% Stake in Airline


S E R B I A

GENERALEXPORT: Serbia Offers Office Component for Sale
[*] SERBIA: Invites Bids for Sale of EUR318-Mil. NPL Portfolio


U N I T E D   K I N G D O M

BULB: UK to Provide GBP4.5 Bil. to Octopus to Support Acquisition
IN-TIME: Enters Liquidation, Ceases Operations
NORTH WEST ELECTRICITY: S&P Affirms 'BB+' Rating, Outlook Negative
VODAFONE GROUP: Egan-Jones Retains BB+ Senior Unsecured Ratings

                           - - - - -


=============
G E R M A N Y
=============

THYSSENKRUPP AG: Egan-Jones Retains BB- Senior Unsecured Ratings
----------------------------------------------------------------
Egan-Jones Ratings Company, on November 25, 2022, maintained its
'BB-' foreign currency and local currency senior unsecured ratings
on debt issued by thyssenkrupp AG.

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




===================
L U X E M B O U R G
===================

ALTISOURCE PORTFOLIO: Egan-Jones Retains CCC+ Sr. Unsec. Ratings
----------------------------------------------------------------
Egan-Jones Ratings Company, on November 28, 2022, maintained its
'CCC+' foreign currency and local currency senior unsecured ratings
on debt issued by Altisource Portfolio Solutions S.A. EJR also
maintained its 'B' rating on commercial paper issued by the
Company.

Headquartered in Luxembourg, Altisource Portfolio Solutions S.A.
provides real estate and mortgage services.




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R O M A N I A
=============

BLUE AIR: Romania Takes Over 75% Stake in Airline
-------------------------------------------------
Razvan Timpescu at SeeNews reports that the Romanian state has
taken over 75% of low-cost carrier Blue Air, a month after the
company announced it was ready to hand over 75% of its shares to
the finance ministry over unpaid debt, the head of the Authority
for State Assets Management (AAAS), Daniel Geanta, said.

Mr. Geanta said in a social media post the AAAS will start an audit
at the company, SeeNews relates.

He said the government agency will hold talks with a potential
investor in the coming period, being open to negotiations, SeeNews
notes.

Blue Air, the only air carrier in Romania with 100% domestic
capital, started operations in December 2004.

In July, Romania's consumer protection authority fined Blue Air
with EUR2 million for cancelling over 11,000 flights over a
12-month period, SeeNews recounts.

At the end of October 2021, Ridgecrest, an AIM-listed cash shell,
terminated negotiations on its proposed reverse takeover of Blue
Air, SeeNews discloses.  The decision was a consequence of the
airline's inability to raise the pre-reverse takeover funding,
which was the main condition of the non-binding heads of agreement
between Ridgecrest and Blue Air's vendors announced in July,
Ridgecrest said at the time, SeeNews relays.

In November, the finance ministry said it planned to take over a
majority stake in the air carrier after it failed to make payments
on a RON300.75 million (US$65.1 million/EUR61.3 million) loan
guaranteed with 75% of the company's stock, according to SeeNews.




===========
S E R B I A
===========

GENERALEXPORT: Serbia Offers Office Component for Sale
------------------------------------------------------
Djordje Jajcanin at SeeNews reports that Serbia will offer for sale
the office component of the Genex Tower building in Belgrade owned
by bankrupt company Generalexport at a minimum price of RSD834.6
million (US$7.5 million/EUR7.1 million) on February 6, local media
reported on Dec. 23.

It will be the third attempt to sell the asset which has an
aggregate area of approximately 15,000 square meters, local media
outlet Blic reported, SeeNews relates.

The company was declared bankrupt in 2015, SeeNews recounts.



[*] SERBIA: Invites Bids for Sale of EUR318-Mil. NPL Portfolio
--------------------------------------------------------------
Djordje Jajcanin at SeeNews reports that Serbia's Deposit Insurance
Agency has invited bids for the sale of a non-performing loan (NPL)
portfolio of EUR318 million (US$337.5 million), the country's
finance ministry said on Dec. 21.

Investors can submit letters of interest by Jan. 9 and the deadline
for the submission of binding offers expires on April 20, the
finance ministry said in a statement, SeeNews relates.

According to SeeNews, the NPL portfolio comprises loans by bankrupt
banks Nova Agrobanka, Universal banka, Jugobanka, Beogradska banka,
Beobanka, Privredna banka Beograd and Invest banka.

This portfolio follows the successful sales of the pilot portfolio
and a large receivables portfolio, with a total nominal value of
more than two billion euro. SeeNews states.

Serbia's NPL portfolio is also at the lowest level since this
indicator has been monitored, and in October amounted to 3.16%,
SeeNews notes.





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

BULB: UK to Provide GBP4.5 Bil. to Octopus to Support Acquisition
-----------------------------------------------------------------
Nathalie Thomas at The Financial Times reports that the UK
government has admitted that it is providing up to GBP4.5 billion
to Octopus Energy to support the purchase of failed electricity
supplier Bulb.

According to the FT, Octopus completed its acquisition of Bulb on
Dec. 20 despite efforts by rivals including Centrica and Eon to
delay the deal through the courts.

In documents published on Dec. 21, the Department for Business,
Energy and Industrial Strategy said the GBP4.5 billion
post-acquisition financing was primarily to support the purchase of
electricity and gas in wholesale markets for Bulb's 1.5 million
customers, and was based on forecast energy costs until March 31,
the FT relates.

Octopus will have to repay loans to purchase wholesale electricity
and gas, which the company should recoup as customers settle their
bills, the FT discloses.

Bulb was placed in "special administration" in November 2021 after
its co-founder and chief executive Hayden Wood, a former management
consultant, admitted to the energy regulator that the business
could no longer withstand sharp surges in wholesale energy prices
and had failed to raise external funding or find a buyer, the FT
recounts.

It was initially supported via a GBP1.69 billion taxpayer loan,
making it the biggest bailout since the rescues of Royal Bank of
Scotland and HBOS during the financial crisis of 2008-09, the FT
notes.

Teneo, which was appointed as special administrator to Bulb, said
in November that of the initial GBP1.69 billion loan, GBP1.14
billion had been drawn down, the FT relays.  The GBP4.5 billion is
in addition to the funding already provided, the FT relays.

The UK's fiscal watchdog, the Office for Budget Responsibility,
estimated last month that the total bill for taxpayers of the Bulb
bailout could reach GBP6.5 billion, although the government
contested that figure, the FT notes.


IN-TIME: Enters Liquidation, Ceases Operations
----------------------------------------------
Michelle Henderson at The Press and Journal reports that jewellery
repair firm In-Time has gone into liquidation, leaving customers in
Aberdeen and Inverness fighting to get their possessions back.

According to The Press and Journal, pop-up stores at Union Square
in Aberdeen and Tesco Inshes in Inverness have closed with
immediate effect as the company ceased trading.

Their website has also been shut down as liquidators FRP Advisory
Trading Limited have been called to take control of their assets,
The Press and Journal relates.

In a statement posted on their website, officials, as cited by The
Press and Journal, said their business would remain closed for the
"foreseeable future."

They wrote: "We regret to advise our customers that the company has
now ceased to trade. The stores and the website are now closed and
will remain so for the foreseeable future.

"The company is proposed to be placed in creditor's voluntary
liquidation by FRP Advisory Trading Limited in the coming weeks,
following which, the proposed liquidators and their staff will be
available to assist existing customers with any queries they may
have regarding the company's circumstances."


NORTH WEST ELECTRICITY: S&P Affirms 'BB+' Rating, Outlook Negative
------------------------------------------------------------------
S&P Global Ratings affirmed its 'BBB+' ratings on Electricity North
West Ltd. and North West Electricity Networks PLC and its 'BB+'
rating on North West Electricity Networks (Holdings) Ltd.

S&P said, "The negative outlook indicates that we could lower the
ratings on all three entities if ENW does not sustain its strong
operational performance and total expenditure outperformance during
RIIO-ED2, and therefore FFO to debt falls below 9%. We will also
monitor the group's financial policy, which is key to maintaining
the current ratings.

"Electricity distribution networks like ENW face a tougher
regulatory update in 2023, and we see this as their biggest
medium-term risk. Although we consider the final determination
published on Nov. 30, 2022, by Ofgem, the U.K. regulator for power
and gas, to be broadly supportive for the sector, it lowers the
allowed equity returns to 5.23% from 6% in the current regulatory
period (RIIO-ED1). We note that the weighted-average cost of
capital (WACC) for networks was revised upward between the draft
determination published on June 29, 2022, and the final
determination. The uplift is driven by a higher cost of equity,
underpinned by an increased risk-free rate, as well as Ofgem's
assumption that the cost of debt would be higher. Ofgem applied a
55 basis-point calibration adjustment to reflect a recent increase
in the cost of issuance. The nominal vanilla WACC is below that of
RIIO-ED1, but the real vanilla WACC of 3.93% is 52 basis points
higher than the average of 3.41% in RIIO-ED1."

New electricity assets will depreciate over 45 years, and this
longer period will lead to lower profitability in the medium term.
This change is part of RIIO-ED1 and was intended to better reflect
the economic life of the assets. It also brings electricity more in
line with gas. Existing electricity assets will continue to be
depreciated over 20 years, while new assets will depreciate over 45
years. As the eight-year transition period comes to an end in March
31, 2023, it will constrain cash flow generation at electricity
transmission and distribution networks over the short and medium
term. Although the overall amount of total returns may be the same,
returns will be pushed further into the future. The resulting dip
in profitability will be significant for ENW during RIIO-ED2, and
even into the following regulatory periods. The change in
depreciation has led to a decrease in allowed revenue derived from
RAV depreciation of about 6% between the start of RIIO-ED1 and the
start of RIIO-ED2. In the financial year ending March 2016, about
40% of allowed revenue consisted of depreciation, while in FY2024
only 34% of allowed revenue will be related to depreciation.

Across the sector, Ofgem also increased the total expenditure
(totex) allowance by an average of 6% compared with the draft
determination. ENW's totex allowance for RIIO-ED2 is 9% below the
amount submitted by the company, but still marks a significant
increase of about 30%-35% from its average annual totex over
RIIO-ED1. The regulator is anticipating that the company will cut
3% from its totex through more efficient spending on its projects.
The rest of the reduction comes with removal of obligations and
lower required investment.

S&P said, "In our view, the group's high gearing of about 90% could
limit its credit metrics. Although the final determination is more
favorable to ENW than the draft determination, we still anticipate
that unless it significantly outperforms the targets, ENW will
struggle to keep its adjusted FFO to debt consistently above our 9%
threshold. Although it has historically been able to balance high
gearing and FFO to debt above 9%, it will be harder to achieve the
same result during RIIO-ED2. We forecast that ENW's financial
ratios are likely to be below those we consider commensurate with a
'BBB+' rating, unless the group's operations and totex
substantially outperform the targets or management implements
alternative mitigating factors.

"We see potential upside from our base case, given ENW's strong
performance during the current regulatory period, RIIO-ED1. ENW
outperformed its RIIO-ED1 targets significantly during RIIO-ED1;
over the first seven years of RIIO-ED1, it earned an average of
2.2% in additional return on regulated equity (RoRE). That said,
the regulatory targets in RIIO-ED2 are considerably tougher. ENW
will benefit from its past performance during the first two years
of the new regulatory period, and if it can outperform during those
years, we would take more comfort that the company will be able to
continue to do so for the rest of RIIO-ED2. This will help mitigate
the pressure we currently anticipate from the third year onward."

ENW will benefit from a custom-built financial incentive that was
created by the regulator to encourage it to restore services more
quickly after unplanned outages. As a result, its RIIO-ED2
financial output delivery incentives (ODIs) set rewards at up to
2.85% of RoRE and penalties at up to 4.2% of RoRE; which is 0.2%
extra in each case, compared with the rest of the sector. If ENW
achieves the full reward available to it, its FFO to debt would
receive a sizable boost. Equally, incurring penalties could put a
substantial dent in its credit metrics.

The negative outlook signifies that credit metrics will be under
pressure during the RIIO-ED2 regulatory period, and that the
group's high consolidated gearing level suggests that it is likely
to struggle to uphold its credit metrics above S&P's 9% FFO-to-debt
threshold if it does not consistently outperform operational and
totex targets during the upcoming regulatory period.

S&P said, "We could lower the ratings on ENW if it fails to achieve
its 9% FFO to debt target. This could happen if the company is
unable to achieve the same level of outperformance against its
regulatory settlement that it reported during RIIO-ED1. We could
also lower the ratings if inflation is more elevated or more
persistent than we currently expect.

"We could revise the outlook to stable if ENW's totex or
operational performance during the first and second year of
RIIO-ED2 is sufficient to provide insight into future performance
and reassurance that the group will maintain FFO to debt above 9%
for the rest of the regulatory period."

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


VODAFONE GROUP: Egan-Jones Retains BB+ Senior Unsecured Ratings
---------------------------------------------------------------
Egan-Jones Ratings Company, on November 25, 2022, maintained its
'BB+' foreign currency and local currency senior unsecured ratings
on debt issued by Vodafone Group PLC.

Headquartered in Berkshire, United Kingdom, Vodafone Group PLC
provides wireless communication services.



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S U B S C R I P T I O N   I N F O R M A T I O N

Troubled Company Reporter-Europe is a daily newsletter co-
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Marites O. Claro, Rousel Elaine T. Fernandez, Joy A. Agravante,
Julie Anne L. Toledo, Ivy B. Magdadaro, and Peter A. Chapman,
Editors.

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