/raid1/www/Hosts/bankrupt/TCREUR_Public/230202.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
E U R O P E
Thursday, February 2, 2023, Vol. 24, No. 25
Headlines
F R A N C E
FLAMINGO LUX II: Moody's Rates New EUR400MM Sec. Notes 'B2'
G E O R G I A
GEORGIA: Fitch Alters Outlook on 'BB' LongTerm IDR to Positive
G E R M A N Y
QUALITY GROUP: S&P Assigns 'B+' LongTerm ICR, Outlook Stable
G R E E C E
GREECE: Fitch Hikes Foreign Currency IDR to 'BB+', Outlook Stable
I R E L A N D
ACCUNIA EUROPEAN I: Moody's Affirms B2 Rating on EUR11.1MM F Notes
GWD FORESTRY: High Court Asked to Appoint Provisional Liquidator
I T A L Y
DIOCLE SPA: Moody's Withdraws 'B1' Corporate Family Rating
L U X E M B O U R G
CRC BREEZE: Fitch Affirms and Withdraws CC Rating on Class B Bonds
EUROFINS SCIENTIFIC: Fitch Gives 'BB' Rating on Subordinated Notes
N E T H E R L A N D S
NEILSENIQ: S&P Affirms 'B' ICR, Outlook Stable
NIELSENIQ: Moody's Cuts CFR to 'B2', Outlook Remains Stable
TCG ACQUISITIONCO: Moody's Alters Outlook on 'B2' CFR to Stable
P O R T U G A L
GUINCHO FINANCE: Moody's Ups Rating on EUR14MM Cl. B Notes to Ba1
R O M A N I A
[*] ROMANIA: Company Insolvencies Up 8.22% to 6,649 in 2022
S W E D E N
FASTIGHETS AB: Moody's Ba2 Rating on Jr. Sub. Notes Still on Review
S W I T Z E R L A N D
COVIS MIDCO 2: Moody's Lowers CFR to Caa3 & Alters Outlook to Neg.
U N I T E D K I N G D O M
BRITISHVOLT: Greybull Capital Emerges as Potential Late Bidder
ELIOT DESIGN: Creditors Unlikely to Receive Payout
SNOWDROP INDEPENDENT: Enters Administration Due to Financial Woes
VUE INT'L: Moody's Appends 'LD' Designation to 'Ca-PD' PDR
WORCESTER WARRIORS: Atlas Consortium Acquires Club
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F R A N C E
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FLAMINGO LUX II: Moody's Rates New EUR400MM Sec. Notes 'B2'
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Moody's Investors Service has affirmed the B2 corporate family
rating and a B2-PD probability default rating of Flamingo Lux II
SCA, the direct parent of EMERIA (formerly Foncia Management SAS)
and the top entity of the restricted group. Concurrently, Moody's
has assigned a B2 rating to the targeted new issuance of EUR400
million guaranteed senior secured notes due 2028 and affirmed the
B2 ratings on the EUR688 million senior secured term loan B2, the
existing EUR1,275 million senior secured term loan B and the EUR400
million guaranteed senior secured notes, all due in 2028 as well as
the EUR437.5 million senior secured first lien revolving credit
facility (RCF) due 2027; all issued by EMERIA, in addition Moody's
affirmed the Caa1 rating of EUR250 million senior unsecured notes
due 2029 issued by Flamingo Lux II SCA. The outlook on both
entities was changed to negative from stable.
Net proceeds from the new guaranteed senior secured notes will be
used to repay EUR240 million currently drawn under the RCF and to
build some additional liquidity cushion of around EUR155 million.
RATINGS RATIONALE
The B2 CFR is supported by EMERIA's leading market position in
France and UK with increasing presence in neighbouring countries
such as Germany, Belgium, and Switzerland; the company's large
recurring revenue base coming from stable residential property
management activities and a solid historical track record of
growing its scale while improving margins. Rating is further
supported by a good liquidity on the back of the aimed transaction,
to be enhanced by positive free cash flow which Moody's expect to
resume over the next 12-18 months and no near-term refinancing
needs.
The company's CFR is currently constrained by the still high
leverage, at above 8x even when considering the 12 months earnings
contribution from 2022 acquisitions, its sensitivity to financial
policy with respect to capital allocation, execution risks,
integration costs and funding needs related to the M&A-driven
growth strategy within fragmented markets; and its geographically
concentration in France, albeit reducing over time with now 21% of
revenues generated outside the French market. Other
non-idiosyncratic risks come from the slowdown of economic
activity, inflationary pressures and rising cost of capital which
will weigh on the company's fixed charge coverage ratio, which
Moody's expect to decline to below 2x by the end of 2023. Moody's
are mindful that the group's sizeable debt stack will expose
EMERIA's credit profile more meaningfully to higher interest costs
over time and absent pronounced operating profit growth will result
in further pressure on its interest coverage.
RATING OUTLOOK
The negative outlook reflects that the rating will remain weakly
positioned through 2024 with leverage still above the guidance for
the B2 rating category on the back of weaker than expected
operating performance in 2022; Moody's estimate that earnings
contribution on an annualised basis from 2022 acquisitions
(including FirstPort) will result in leverage reducing towards 8x
during 2023. However Moody's don't expect leverage to reach levels
below 7x before end of 2024, when the cost savings under the roll
out of the Millenium / Agence du Future will start materializing.
The outlook also incorporates broadly stable trading conditions in
EMERIA's core residential real estate services markets.
The rating guidance is calibrated on the company's current quality
of reported earnings which includes substantial one-off adjustments
related to acquisitions made in each financial year. For now,
Moody's see most of those type of costs as rather recurring because
of company's M&A-driven growth strategy.
Moody's would expect EMERIA's underlying earnings quality to
gradually improve as the company successfully integrates acquired
businesses and reaches a scale where organic growth becomes the
main driver.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Downward rating pressure could arise if credit metrics remain
sustainably weak for the B2 CFR, with leverage remaining above 7x
beyond 2024 or if FCF remains negative, in case of lagging
operating performance on company's earnings guidance, execution
issues with the new strategic initiatives, or debt-funded
acquisitions. This would be evidenced by Moody's-adjusted
debt/EBITDA remaining sustainably above 6.5x, FCF/Debt not
improving towards 5% or fixed charge coverage falling below 1.5x.
Upward rating pressure is unlikely given the negative outlook but
could develop if a strong revenue and margin expansion on the back
of the new strategic initiatives lead to Moody's-adjusted
debt/EBITDA falling sustainably towards 5x, FCF/debt increasing
towards 10% and fixed charge coverage at above 2.5x.
LIQUIDITY
Liquidity is good with ca. EUR180 million cash pro forma for the
refinancing, Moody's expectation of the company to resume positive
free cash flow generation over the next 12 to 18 months and
additional EUR437.5m undrawn under RCF after repayment on the back
of the targeted new issuance.
Moody's expects the company to maintain ample headroom under the
springing covenant attached to the RCF. There is no material debt
maturing before 2027, when the RCF matures.
ESG CONSIDERATIONS
ESG considerations incorporated in EMERIA's ratings mainly relate
to governance risks, associated with its private equity ownership
and the traditionally more aggressive financial policy to that,
which is tolerant of high leverage, debt-funded M&A and
recapitalisation measures.
However, Moody's understand from shareholders' and management that
they are committed to no aggressively financed acquisitions or
recapitalisation measures over the next 12-18 months, as EMERIA
continues to be a strategic investment to them that offers solid
earnings prospects. A recent example of that is the equity
contribution made in the context of the acquisition of FirstPort
during 2022.
Social risks are also entailed in the company's operations due to
the propensity of the residential real estate services market to be
subject to regulatory risk.
STRUCTURAL CONSIDERATIONS
The guaranteed senior secured debt instruments including the
targeted new guaranteed senior secured notes are rated B2, at the
same level as the CFR, reflecting their pari passu ranking and the
comparatively small amount of junior debt ranking below them.
Conversely, the senior unsecured notes are rated Caa1 due to the
comparatively high amount of debt ranking ahead of them in the
capital structure.
The senior secured bank credit facilities benefit from a security
package comprising share pledges of material subsidiaries,
assignment of intercompany receivables, and pledges over certain
bank accounts. The senior secured bank credit facilities also
benefit from upstream guarantees from most operating subsidiaries.
The senior unsecured notes benefit from the same upstream
guarantees as the senior secured debt, but on a second ranking
basis.
PRINCIPAL METHODOLOGY
The principal methodology used in these ratings was Business and
Consumer Services published in November 2021.
CORPORATE PROFILE
Headquartered in France, EMERIA is a leading provider of
residential real estate services through a network of over 500
branches. The company, which is owned by a consortium led by
private equity fund Partners Group since 2016, generated revenue of
EUR1.2 billion and a reported EBITDA of EUR316 million for the 11
months period that ended in November 2022.
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G E O R G I A
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GEORGIA: Fitch Alters Outlook on 'BB' LongTerm IDR to Positive
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Fitch Ratings has revised the Outlook on Georgia's Long-Term
Foreign-Currency Issuer Default Rating (IDR) to Positive from
Stable and affirmed the IDR at 'BB'.
KEY RATING DRIVERS
The revision of the Outlook on Georgia's IDRs reflects the
following key rating drivers and their relative weights:
HIGH
Macroeconomic Performance Supports Outlook: The Positive Outlook
partly reflects very strong GDP growth, a rise in international
reserves, and fiscal outperformance in 2022, driven by a rebound in
tourism, and large migrant and capital inflows from Russia, a
sizeable part of which Fitch now expects will endure. Macro-fiscal
policy has remained sound, with relatively tight monetary policy,
and contained expenditure growth and buoyant revenues supporting
fiscal deficit reduction and a sharp fall in public debt/GDP in
2022, while the IMF Stand-By Arrangement (SBA) augments its
confidence in policy settings and reduces downside risks.
Exceptionally Strong GDP Growth: The economy expanded by an
estimated 10.3% in 2022, following 10.4% growth in 2021, with
domestic demand boosted by the surge in migrants and a sharp
increase in transportation, while tourism receipts rose to
pre-pandemic levels. Fitch forecasts GDP growth will moderate to
4.5% in 2023, due to fading support from Russian inflows and weaker
external demand, returning to just above the trend rate of 5.0% in
2024, and much stronger than the projected 'BB' median of 3.2%.
Fitch has greater confidence that last year's migrant and capital
inflows will not sharply reverse, partly due to the protracted
nature of the war in Ukraine and as migrants become somewhat more
integrated into the Georgian economy.
Improved External Buffers: Strong capital inflows and a narrowing
current account deficit drove a 13% appreciation of the lari
against the US dollar over the last year, and lifted international
reserves by USD0.6 billion to USD4.9 billion in the year to
end-December. Around 90,000 Russian and Belarusians migrated to
Georgia in 2022, money transfers surged by 86%, and tourism
rebounded, narrowing the current account deficit by an estimated
6.4pp to 4.0% of GDP. Fitch projects the current account deficit
widens to an average 6.8% in 2023-2024, partly reflecting a limited
reversal of migration trends, and international reserves end 2024
at 3.3 months of current external payments, from 3.2 months at
end-2022.
Fiscal Outperformance in 2022: The general government deficit fell
an estimated 3.8pp in 2022 to 2.7% of GDP, below the original
budget target of 4.0%, driven by strong revenue growth, alongside
relative expenditure restraint. Fitch forecasts a deficit of 2.6%
of GDP in 2023, as tax revenue growth moderates and higher public
sector wage spending partly offsets the withdrawal of remaining
pandemic support. Fitch projects the deficit edges up to 2.8% of
GDP in 2024 on moderate pre-election spending, slightly below the
3.0% fiscal rule ceiling, and the projected 'BB' median of 3.2%.
Georgia has a strong record of fiscal discipline, and is also
advancing reforms to improve the transparency and corporate
governance of state-owned enterprises.
Public Debt Stabilises at Lower Level: Fitch estimates public debt
fell by a greater-than-expected 9.3pp in 2022 to 40.1% of GDP,
returning to its pre-pandemic level, supported by a high GDP
deflator. Fitch projects public debt/GDP to stabilise in 2023-2024,
ending 2024 at 39.7%, below the projected 'BB' median of 55.0%.
There is a high degree of exchange rate risk, given 75% is
foreign-currency denominated, although 70% is on concessional terms
and the weighted average maturity of external debt is more than
eight years. Georgia successfully completed the first review of its
three-year USD40 million SBA in December. Strong programme
compliance provides a further fiscal anchor and helps reduce
external liquidity risk, although Fitch does not anticipate Georgia
will draw down on the facility.
Georgia's ratings also reflect the following rating drivers:
Fundamental Rating Strengths and Weaknesses: The rating is
supported by Georgia's strong governance and economic development
indicators relative to the 'BB' medians, and by its credible
macro-fiscal policy framework. These factors are balanced by
significant exposure of public debt to foreign-currency risk, high
financial dollarisation, and weaker external finances, including
high net external debt and a large negative international
investment position.
Inflationary Pressure: Inflation eased to 9.8% in December, from
13.3% in May, with core inflation of 6.8%, but still well above the
National Bank of Georgia's (NBG) target of 3%. Fitch forecasts
inflation falls to 5.2% at end-2023, due to base effects, the
lagged effects of currency appreciation, lower global commodity
prices, and as demand normalises given the peak of the immigration
influx has passed, and to 3.9% at end-2024, but risks remain skewed
to the upside.
Geopolitical Challenges: Georgia is exposed to geopolitical risks
from the unresolved conflicts involving Russia in Abkhazia and
South Ossetia. The government's efforts to manage its relationship
with Russia potentially represents a further complication to its
aim of gaining EU candidate status. In not granting Georgia this
status in June 2022, the EU set out priority reforms including to
strengthen the judiciary and political representation and reduce
oligarch influence. More generally, Georgia's World Bank governance
percentile ranking has declined 1.5pp over the last two years and
Fitch does not anticipate a clear reversal of the recent trend.
Elections Moderately Increase Policy Uncertainty: Current polls
suggest that the ruling Georgian Dream will comfortably remain the
single largest party following next year's parliamentary elections,
but it would likely require coalition support, potentially
involving challenging political negotiations. While this could
result in somewhat greater political instability and uncertainty,
and further limit the prospects of advancing structural reforms and
improving the business environment over time, Fitch does not
anticipate any marked change in macro-fiscal policy settings.
Banking Sector Resilience, High Dollarisation: The Georgian banking
sector is stable and has generally sound credit fundamentals. The
sector Tier 1 capital ratio improved 1.5pp in 2022 to 17.1%,
regulatory non-performing loans fell to 4.0%, return on average
equity is strong at 25% (9M22), and the outlook for profitability
is good. The liquid asset ratio has risen to 23% helped by a sharp
rise in non-resident deposits, and muted real credit growth of 5%
(annualised) in 9M22. Deposit dollarisation has steadily fallen to
57.1%, supported by macro-prudential measures, but still well above
the 'BB' median of 19.1% and a structural weakness for the sector.
ESG - Governance: Georgia has an ESG Relevance Score of '5' and
'5[+]' for political stability and rights, and for the rule of law,
institutional and regulatory quality and control of corruption
respectively. Theses scores reflect the high weight that the World
Bank Governance Indicators (WBGI) have in our proprietary Sovereign
Rating Model (SRM). Georgia has a medium WBGI ranking at the 61st
percentile, reflecting moderate institutional capacity, established
rule of law, a moderate level of corruption and political risks
associated with the unresolved conflict with Russia.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
- External Finances: A marked increase in external vulnerability,
for example from sharp reversal of capital inflows, sizeable
decline in international reserves, or sustained widening of the
current account deficit
- Structural: Substantial worsening of domestic political or
geopolitical risks with adverse consequences for economic growth
and the policy framework
- Public Finances: Increasing government debt/GDP over the medium
term, reflecting fiscal loosening, a weaker growth environment or
further external shocks
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
- External Finances: A reduction in external vulnerability, for
example from a sizeable increase in international reserves and/or
narrowing in the current account deficit closer to peer levels,
potentially leading to the removal of the -1 notch on external
finances
- Public Finances: Government debt/GDP being placed on a firm
downward path over the medium term, for example due to stronger
sustainable revenue growth
- Macro: Strong and sustained GDP growth outlook with a reduction
in macroeconomic vulnerabilities such as the high level of
dollarisation, leading to a higher GDP per capita level
SOVEREIGN RATING MODEL (SRM) AND QUALITATIVE OVERLAY (QO)
Fitch's proprietary SRM assigns Georgia a score equivalent to a
rating of 'BB+' on the LTFC IDR scale.
Fitch's sovereign rating committee adjusted the output from the SRM
to arrive at the LTFC IDR by applying its QO, relative to SRM data
and output, as follows:
- 1 notch, to reflect that relative to its peer group, Georgia has
higher net external debt, a structurally larger current account
deficit, and a large negative net international investment
position.
Fitch's SRM is the agency's proprietary multiple regression rating
model that employs 18 variables based on three-year centred
averages, including one year of forecasts, to produce a score
equivalent to a LT FC IDR. Fitch's QO is a forward-looking
qualitative framework designed to allow for adjustment to the SRM
output to assign the final rating, reflecting factors within its
criteria that are not fully quantifiable and/or not fully reflected
in the SRM.
ESG CONSIDERATIONS
Georgia has an ESG Relevance Score of '5' for political stability
and rights as WBGI have the highest weight in Fitch's SRM and are
therefore highly relevant to the rating and a key rating driver
with a high weight. As Georgia has a percentile rank below 50 for
the respective governance indicator, this has a negative impact on
the credit profile.
Georgia has an ESG Relevance Score of '5[+]' for rule of law,
institutional, regulatory quality and control of corruption as WBGI
have the highest weight in Fitch's SRM and are therefore highly
relevant to the rating and are a key rating driver with a high
weight. As Georgia has a percentile rank above 50 for the
respective governance indicators, this has a positive impact on the
credit profile.
Georgia has an ESG Relevance Score of '4' for human rights and
political freedoms as the voice and accountability pillar of the
WBGI is relevant to the rating and a rating driver. As Georgia has
a percentile rank below 50 for the respective governance indicator,
this has a negative impact on the credit profile.
Georgia has an ESG Relevance Score of '4' for creditor rights as
willingness to service and repay debt is relevant to the rating and
is a rating driver for Georgia, as for all sovereigns. As Georgia
has a fairly recent restructuring of public debt in 2004, this has
a negative impact on the credit profile.
Except for the matters discussed above, the highest level of ESG
credit relevance, if present, is a score of '3'. This means ESG
issues are credit-neutral or have only a minimal credit impact on
the entity, either due to their nature or to the way in which they
are being managed by the entity.
Entity/Debt Rating Prior
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Georgia LT IDR BB Affirmed BB
ST IDR B Affirmed B
LC LT IDR BB Affirmed BB
LC ST IDR B Affirmed B
Country Ceiling BBB- Affirmed BBB-
senior
unsecured LT BB Affirmed BB
senior
unsecured ST B Affirmed B
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G E R M A N Y
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QUALITY GROUP: S&P Assigns 'B+' LongTerm ICR, Outlook Stable
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S&P Global Ratings assigned its 'B+' long-term issuer credit rating
to German nutrition company The Quality Group (Asterix HoldCo) and
its 'B+' issue rating to the term loan B (TLB).
The outlook is stable, reflecting S&P's assumption that Asterix's
growth will continue to outperform that of the German nutrition
market by 300-500 basis points (bps) and its adjusted leverage will
remain well below 4x.
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G R E E C E
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GREECE: Fitch Hikes Foreign Currency IDR to 'BB+', Outlook Stable
-----------------------------------------------------------------
Fitch Ratings has upgrade Greece's Long-Term Foreign-Currency
Issuer Default Rating (IDR) to 'BB+' from 'BB'. The Outlook is
Stable.
KEY RATING DRIVERS
The upgrade of Greece's IDRs reflects the following key rating
drivers and their relative weights
High
Improved Fiscal Outturns: Fitch now expects better deficit and debt
outturns and projections in 2022-2024, thanks to stronger nominal
growth, budget over-execution and a favourable debt-servicing
structure. Fitch forecasts a further narrowing of the general
government deficit to 1.8% of GDP in 2024 from an estimated 3.8% in
2022, in part due to streamlining of temporary support measures.
This implies an improvement in the primary balance of 2.5pp, to a
surplus of 0.9% in 2024 (and balanced position in 2023). There is
some uncertainty around fiscal policies after the upcoming
legislative elections but the risks are mitigated by a broad
commitment to and a recent track record of fiscal prudence.
In 2022 Greece benefited from a very strong snowball effect given
decades-high nominal growth and only a very modest increase in
average interest rate costs, leading to an estimated record
narrowing of 24.5pp in the general government debt/GDP ratio to
170%. We expect the debt ratio to fall at a more moderate pace over
the medium term, driven largely by primary balance surpluses. At a
projected 160.6% in 2024, the debt ratio is still forecast to be
among the highest of Fitch-rated sovereigns, and more than 3x the
'BB' median, but mitigating factors such as low-debt servicing
costs, very long maturities (close to 20 years) and substantial
liquid cash buffers (around 15% of GDP) reduce public finance
risks.
Reduced Banking Sector Risks: There continues to be important
progress in reducing non-performing loans (NPL), with the domestic
NPL ratio falling to 9.7% in 3Q22, under 10% for the first time
since 2009, driven by securitisation transactions under the
Hellenic Asset Protection Scheme (HAPS) and broad-based economic
recovery. Fitch expects further improvement in the sector's asset
position supported by contained new inflows, and as the banks
complete pending inorganic actions. NPL ratios at non-systemic
banks will remain a challenge, but as these banks account for less
than 5% of the sector, the potential risks (including to the
sovereign) are very modest.
Demand for household credit remains weak, but overall credit to the
private sector accelerated in 2H22 (only slightly below inflation)
driven by corporates. Reduced macro risks, resilience in the labour
market, government support measures and continued increase in
real-estate prices should moderate pressure on borrowers
Greece's 'BB+' IDRs also reflect the following key rating drivers:
Structural Strengths: Greece's rating is underpinned by income per
capita that far exceeds the 'BB' and 'BBB' medians. Governance
scores and human development indicators are among the highest of
sub-investment grade peers. These strengths are set against the
legacies of the sovereign debt crisis, which include large stocks
of public and external debt, as well as low medium-term growth
potential and vulnerabilities in the banking sector.
Macro Outlook, Reform Momentum: Fitch forecasts GDP growth to reach
0.9% in 2023 and 2.3% in 2024. Fitch has revised up its
macro-forecasts since the last review, given an improvement in the
balance of risks, in particular given the recent moderation in
energy prices and reduced prospects of energy rationing across
Europe. The authorities also continue to make progress in their
reform agenda, in part tied to milestones of the Recovery and
Resilience Facility (RRF), which combined with the final year of
the 2014-2020 absorption of Multi Annual Framework Funds (MFF),
will provide solid investment momentum. The main domestic risk is
tied to potential delays to RRF funds given the electoral cycle,
but at present Fitch would expect this to be temporary.
Inflation to Ease but Risk Persist: Fitch expects a steady
deceleration in headline inflation, from 9.3% in 2022 to 5.0% in
2023 and only 1.5% in 2024, in line with easing of energy and other
commodity prices as well as base effects. Core inflation is also
expected to ease, but at a more moderate pace. Developments in wage
trajectory constitute a risk, in particular if the labour market
continues to tighten and higher wages in some sectors such as
services or construction spill over to the rest of the economy. In
3Q22, seasonally adjusted wages for the whole economy went up by
7.3% yoy, the highest rate since 2010, while job vacancies in
1Q-3Q22 were the highest in a decade.
Stable Financing Costs: Government bond yields have stabilised in
recent months, after rising steeply in 2022 in line with global
trends. In January Greece issued a EUR3.5 billion bond at a yield
of 4.27% (last September yields were 5.0%), amounting to half the
announced external borrowing needs for this year. Fitch forecasts
the interest to-revenue ratio will rise only gradually to 5.5% in
2024 compared with the 'BB' median projection of 9.0%.
In addition to long maturities, Greek debt is all fixed rate and
entirely in local currency, further reducing risks of market
volatility. One outstanding change is the likely reclassification
by Eurostat of HAPS guarantees, which could add EUR18 billion (or
8.5% of GDP) to the stock of public debt, although it would not
alter the deficit or increase interest payments.
External Balance Sheet: Fitch forecasts a gradual narrowing of the
current account deficit (CAD) in line with improving terms of trade
and continued strong tourism inflows, from an estimated 8.0% of GDP
in 2022 to an average 5.5% in 2023-2024. Increasing levels of
foreign direct investment and steady EU capital flows will support
the balance of payments. A projected fall in external liabilities,
combined with strong nominal GDP growth, mean that the ratio of net
external debt will improve further over the forecast period (from
an estimated 128% of GDP in 2022), although it will remain amongst
the highest of Fitch-rated sovereigns.
Electoral Outlook: Under planned changes to the electoral system,
Greece is likely to have two consecutive elections over the coming
months, as at present no party seems likely to win a majority using
simple proportional representation (now the requirement for the
first election, which is likely to take place in 2Q23). This means
that the electoral cycle is likely to be lengthier, reducing the
scope for policy implementation this year. Nevertheless, abrupt
policy changes are unlikely even if there is a change of
government. Relations with the EU have been solidified under the
governments of both ruling centre-right New Democracy and the
leftist Syriza, with the country gradually moving away from
post-crisis era supervisory framework.
Country Ceiling Revised Upwards: Fitch has revised Greece's Country
Ceiling by two notches, to 'A' from 'BBB+'. The five-notch
differential between the Foreign-Currency IDR and Country Ceiling
(as opposed to a four-notch differential previously) reflects its
assessment of reduced risks of capital controls, and an improvement
in the institutional and financial framework of the country.
Greece's Country Ceiling uplift remains below most countries in the
eurozone (which have the maximum six-notch uplift) as Fitch
considers the risks of an exit from the currency union or
arrangement, or the imposition of capital controls to be generally
higher for lower-rated sovereigns.
ESG - Governance: Greece has an ESG Relevance Score (RS) of '5[+]'
for both Political Stability and Rights and for the Rule of Law,
Institutional and Regulatory Quality and Control of Corruption.
Theses scores reflect the high weight that the World Bank
Governance Indicators (WBGI) have in its proprietary Sovereign
Rating Model. Greece has a medium WBGI ranking at 64.8 reflecting a
recent track record of peaceful political transitions, a moderate
level of rights for participation in the political process,
moderate institutional capacity, established rule of law and a
moderate level of corruption.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
- Public Finances: A sustained upward trend in public debt/GDP, for
example due to structural fiscal loosening, weak growth or
materialisation of contingent liabilities from the banking sector.
- Macro: Renewed adverse shocks to the Greek economy affecting the
economic recovery or Greece's medium-term growth potential.
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
- Public Finances: Confidence in a continued firm downward path for
the government debt/GDP ratio over the medium term.
- Macro: Improvement in medium-term growth potential and
performance, for example, driven by higher investment dynamics
and/or implementation of structural reforms.
SOVEREIGN RATING MODEL (SRM) AND QUALITATIVE OVERLAY (QO)
Fitch's proprietary SRM assigns Greece a score equivalent to a
rating of BB+ on the Long-Term Foreign-Currency (LT FC) IDR scale.
Fitch's sovereign rating committee did not adjust the output from
the SRM to arrive at the final LT FC IDR.
- Fitch has removed the -1 notch on structural features, to reflect
the substantial improvements in the banking sector's asset quality,
which reduces the contingent liability risks to the sovereign and
spill overs to macro-stability.
Fitch's SRM is the agency's proprietary multiple regression rating
model that employs 18 variables based on three-year centred
averages, including one year of forecasts, to produce a score
equivalent to a LT FC IDR. Fitch's QO is a forward-looking
qualitative framework designed to allow for adjustment to the SRM
output to assign the final rating, reflecting factors within its
criteria that are not fully quantifiable and/or not fully reflected
in the SRM.
ESG CONSIDERATIONS
Greece has an ESG Relevance Score of '5[+]' for Political Stability
and Rights as World Bank Governance Indicators have the highest
weight in Fitch's SRM and are therefore highly relevant to the
rating and a key rating driver with a high weight. As Greece has a
percentile rank above 50 for the respective Governance Indicator,
this has a positive impact on the credit profile.
Greece has an ESG Relevance Score of '5[+]' for Rule of Law,
Institutional & Regulatory Quality and Control of Corruption as
World Bank Governance Indicators have the highest weight in Fitch's
SRM and are therefore highly relevant to the rating and are a key
rating driver with a high weight. As Greece has a percentile rank
above 50 for the respective Governance Indicators, this has a
positive impact on the credit profile.
Greece has an ESG Relevance Score of '4[+]'for Human Rights and
Political Freedoms as the Voice and Accountability pillar of the
World Bank Governance Indicators is relevant to the rating and a
rating driver. As Greece has a percentile rank above 50 for the
respective Governance Indicator, this has a positive impact on the
credit profile.
Greece has an ESG Relevance Score of '4' for Creditor Rights as
willingness to service and repay debt is relevant to the rating and
is a rating driver for Greece, as for all sovereigns. As Greece has
a fairly recent restructuring of public debt in 2012, this has a
negative impact on the credit profile.
Except for the matters discussed above, the highest level of ESG
credit relevance, if present, is a score of '3'. This means ESG
issues are credit-neutral or have only a minimal credit impact on
the entity, either due to their nature or to the way in which they
are being managed by the entity.
Entity/Debt Rating Prior
----------- ------ -----
Greece LT IDR BB+ Upgrade BB
ST IDR B Affirmed B
LC LT IDR BB+ Upgrade BB
LC ST IDR B Affirmed B
Country Ceiling A Upgrade BBB+
senior
unsecured LT BB+ Upgrade BB
senior
unsecured ST B Affirmed B
=============
I R E L A N D
=============
ACCUNIA EUROPEAN I: Moody's Affirms B2 Rating on EUR11.1MM F Notes
------------------------------------------------------------------
Moody's Investors Service has upgraded the ratings on the following
notes issued by Accunia European CLO I DAC:
EUR20,000,000 Class B-1 Senior Secured Floating Rate Notes due
2030, Upgraded to Aaa (sf); previously on Jul 29, 2021 Upgraded to
Aa1 (sf)
EUR27,400,000 Class B-2 Senior Secured Fixed Rate Notes due 2030,
Upgraded to Aaa (sf); previously on Jul 29, 2021 Upgraded to Aa1
(sf)
EUR27,100,000 Class C Senior Secured Deferrable Floating Rate
Notes due 2030, Upgraded to Aa3 (sf); previously on Jul 29, 2021
Upgraded to A1 (sf)
Moody's has also affirmed the ratings on the following notes:
EUR283,700,000 (Current outstanding amount EUR221,815,640) Class A
Senior Secured Floating Rate Notes due 2030, Affirmed Aaa (sf);
previously on Jul 29, 2021 Affirmed Aaa (sf)
EUR27,600,000 Class D Senior Secured Deferrable Floating Rate
Notes due 2030, Affirmed Baa2 (sf); previously on Jul 29, 2021
Upgraded to Baa2 (sf)
EUR24,900,000 Class E Senior Secured Deferrable Floating Rate
Notes due 2030, Affirmed Ba2 (sf); previously on Jul 29, 2021
Upgraded to Ba2 (sf)
EUR11,100,000 (Current outstanding amount EUR6,209,742) Class F
Senior Secured Deferrable Floating Rate Notes due 2030, Affirmed B2
(sf); previously on Jul 29, 2021 Upgraded to B2 (sf)
Accunia European CLO I DAC, issued in August 2016 and reset in May
2019, is a collateralised loan obligation (CLO) backed by a
portfolio of mostly high-yield senior secured European loans. The
portfolio is managed by ACCUNIA FONDSMA†GLERSELSKAB A/S. The
transaction's reinvestment period ended in May 2021.
RATINGS RATIONALE
The rating upgrades on the Class B-1, Class B-2 and Class C notes
are primarily a result of the deleveraging of the Class A notes
following the amortisation of the underlying portfolio since May
2022.
The Class A notes have paid down by approximately EUR32.66 million
(11.5%) since May 2022 and EUR61.88 million (21.8%) since closing.
As a result of the deleveraging, over-collateralisation (OC) has
increased across the capital structure. According to the trustee
report dated January 2023 [1] the Class A/B, Class C, Class D,
Class E and Class F OC ratios are reported at 140.08%, 128.48%,
118.5%, 110.73% and 107.59% compared to April 2022 [2] levels of
139.64%, 128.14%, 118.22%, 110.51% and 107.38% respectively.
Moody's notes that the January 2023 principal payments are not
reflected in the reported OC ratios.
In light of reinvestment restrictions during the amortisation
period, and therefore the limited ability to effect significant
changes to the current collateral pool, Moody's analysed the deal
assuming a higher likelihood that the collateral pool
characteristics would maintain an adequate buffer relative to
certain covenant requirements. In particular, Moody's assumed that
the deal will benefit from a shorter amortisation profile than it
had assumed in the last review in May 2022.
The key model inputs Moody's uses in its analysis, such as par,
weighted average rating factor, diversity score and the weighted
average recovery rate, are based on its published methodology and
could differ from the trustee's reported numbers.
In its base case, Moody's used the following assumptions:
Performing par and principal proceeds balance: EUR389.56m
Defaulted Securities: none
Diversity Score: 42
Weighted Average Rating Factor (WARF): 2942
Weighted Average Life (WAL): 3.12 years
Weighted Average Spread (WAS) (before accounting for Euribor
floors): 3.58%
Weighted Average Coupon (WAC): 2.47%
Weighted Average Recovery Rate (WARR): 45.31%
Par haircut in OC tests and interest diversion test: none
The default probability derives from the credit quality of the
collateral pool and Moody's expectation of the remaining life of
the collateral pool. The estimated average recovery rate on future
defaults is based primarily on the seniority of the assets in the
collateral pool. In each case, historical and market performance
and a collateral manager's latitude to trade collateral are also
relevant factors. Moody's incorporates these default and recovery
characteristics of the collateral pool into its cash flow model
analysis, subjecting them to stresses as a function of the target
rating of each CLO liability it is analysing.
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.
Counterparty Exposure:
The rating action took into consideration the notes' exposure to
relevant counterparties, such as account bank and swap providers,
using the methodology "Moody's Approach to Assessing Counterparty
Risks in Structured Finance" published in June 2022. Moody's
concluded the ratings of the notes are not constrained by these
risks.
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.
Additional uncertainty about performance is due to the following:
Portfolio amortisation: The main source of uncertainty in this
transaction is the pace of amortisation of the underlying
portfolio, which can vary significantly depending on market
conditions and have a significant impact on the notes' ratings.
Amortisation could accelerate as a consequence of high loan
prepayment levels or collateral sales by the collateral manager or
be delayed by an increase in loan amend-and-extend restructurings.
Fast amortisation would usually benefit the ratings of the notes
beginning with the notes having the highest prepayment priority.
In addition to the quantitative factors that Moody's explicitly
modelled, qualitative factors are part of the rating committee's
considerations. These qualitative factors include the structural
protections in the transaction, its recent performance given the
market environment, the legal environment, specific documentation
features, the collateral manager's track record and the potential
for selection bias in the portfolio. All information available to
rating committees, including macroeconomic forecasts, input from
other Moody's analytical groups, market factors, and judgments
regarding the nature and severity of credit stress on the
transactions, can influence the final rating decision.
GWD FORESTRY: High Court Asked to Appoint Provisional Liquidator
----------------------------------------------------------------
Breakingnews.ie reports that the High Court has been asked to
appoint a provisional liquidator to investigate the affairs of a
Dublin-registered forestry company that is alleged to have taken in
EUR30 million from investors.
According to Breakingnews.ie, the application has been made in
respect of GWD Forestry Limited, with a registered address at
Northumberland Road Dublin 4, which the court heard is insolvent
and unable to pay its debts.
The company proposed to go into voluntary liquidation at a
creditor's meeting last December, Breakingnews.ie recounts.
However, the court heard that investors in the company are
concerned over the manner in which the firm has been run and over
its plan to go into voluntary liquidation, Breakingnews.ie notes.
GWD's attempts to go voluntary liquidation was not done in
accordance with Irish company law, it is claimed, Breakingnews.ie
relays.
It is alleged that a second creditor's meeting has been called by
the company and is due to take place later this week,
Breakingnews.ie states.
Arising out of his concerns about a proposal to again seek to wind
up the company one investor, and a creditor of GWD, has petitioned
the High Court to appoint insolvency practitioner Declan de Lacey
of PKF O'Connor Leddy Holmes as provisional liquidator to the
company, Breakingnews.ie discloses.
Franco Bertellino from Rivoli in Italy says he want Mr. de Lacy
appointed in order to mitigate risks including preventing the
company from proceeding with an improperly convened creditors
meeting, Breakingnews.ie notes.
He never received any return from the company from his investment
he claims, according to Breakingnews.ie.
=========
I T A L Y
=========
DIOCLE SPA: Moody's Withdraws 'B1' Corporate Family Rating
----------------------------------------------------------
Moody's Investors Service has withdrawn the B1 corporate family
rating and B1-PD probability of default rating of Diocle S.p.A.
("DOC Generici" or "the company"). The stable outlook has been
withdrawn.
RATINGS RATIONALE
DOC Generici has been acquired by a new private-equity fund last
year in a deal supported by club unitranche private debt. Following
the closing of the transaction in October 2022, the outstanding
euro-denominated backed senior secured bond was fully redeemed.
Moody's has decided to withdraw the ratings because it believes it
has insufficient or otherwise inadequate information to support the
maintenance of the ratings.
COMPANY PROFILE
DOC Generici is a leading Italian independent generics company
operating in the retail channel. The company operates only in the
Italian market and has operations across a wide variety of
therapeutic categories. TPG Capital acquired the company from
Intermediate Capital Group (ICG) and Merieux Equity Partners in
June 2022.
===================
L U X E M B O U R G
===================
CRC BREEZE: Fitch Affirms and Withdraws CC Rating on Class B Bonds
------------------------------------------------------------------
Fitch Ratings has affirmed CRC Breeze Finance S.A., (Breeze II)'s
class A at 'CCC' and class B at 'CC'. Fitch has simultaneously
withdrawn the rating for commercial reasons.
RATING RATIONALE
The ratings reflect that there may be insufficient cash in the debt
service reserve account (DSRA) to service the bonds until maturity,
indicating that default has become a real possibility. Volumes
continue to be below the revised in 2010 P90 values. Fitch expects
continued cash flow pressure due to an increase in operating and
maintenance costs and a decrease in turbine availability as the
assets age.
The bonds' equally sized semi-annual principal repayments in any
given year do not consider summer and winter wind seasonality,
which results in less cash being available for the autumn debt
service. The class B bonds' DSRA has no funds and the class A
bonds' DSRA is partially depleted. Its forecasts indicate that
neither DSRA will be replenished as flows into them are
subordinated to the repayment of the class B bond deferrals,
currently approximately EUR18 million (around 36% of the original
class B notional). Fitch perceives a default as probable for the
class B notes.
Fitch has withdrawn the EUR300 million class A and the EUR50
million class B ratings for commercial reasons.
KEY RATING DRIVERS
Operation Risk - Weaker
Aging Turbines Trigger More Maintenance
Turbine availability has historically been high, at or even
slightly exceeding Fitch's expectation of 96.5%. CRC Breeze Finance
has also demonstrated better cost control in recent years after
initially underestimating the budget prior to entering into the
transaction. However, Fitch considers that a decrease in
availability in the coming years is likely, given that the turbines
are aging and will need more maintenance, and this has been
reflected in Fitch's rating case. At the same time, Fitch expects
operating costs to increase.
Revenue Risk - Volume - Weaker
Initial Wind Estimates Largely Overestimated
The initial wind study grossly overestimated CRC Breeze Finance's
wind resources. A new study displaying lower wind forecasts was
prepared in 2010, which revised the wind forecast down by 17%.
However, the actual wind yield is also lower than the revised wind
estimates. Fitch now considers historical data as a more reliable
basis for its volume projections, because the actual wind yield has
repeatedly fallen short of expectations.
Revenue Risk - Price - Midrange
Limited Exposure to Merchant Pricing
The wind farms are remunerated through fixed feed-in-tariffs
embedded in German and French energy regulation. German tariffs are
set for 20 years and French tariffs for 15 years. This exposes the
project to merchant pricing, at approximately 10% of the
portfolio's generation capacity during the last three to four
years, increasing to more than 20% at the last payment date.
Debt Structure - Senior - Midrange
Partially Depleted Class A DSRA
The class A bonds rank senior, are fully amortising and have a
fixed interest rate. However, the structure is weakened by equally
sized semi-annual principal repayments together with the potential
leakage of cash to pay semi-annual class B payments ignoring wind
seasonality. The low volumes have affected the project's cash
generation, and liquidity remains tight. Fitch does not expect it
to materially improve.
There have been several drawdowns on the DSRA, meaning that debt
service can still be maintained to an extent during weak wind
seasons but the reserve is significantly eroded, at EUR5.2 million
versus the initial balance of EUR13.3 million. A replenishment of
this reserve is very unlikely, as it is subordinated to the
repayment of the entire balance of deferrals on the class B bonds.
Additional drawings on the class A DSRA would further affect the
debt structure
Debt Structure - Subordinated - Weaker
Large Amounts of Deferrals on Class B
The class B DSRA is depleted and large amounts of scheduled
payments on the class B bonds have been repeatedly deferred over
the years. In November 2022, the total accumulated amount of class
B principal deferrals was approximately EUR18 million, which may be
repaid until the class A bonds reach their maturity, but the
subordination to the class A makes this scenario unlikely.
Financial Profile
Fitch's rating case results in average and minimum DSCRs of 0.81x
and 0.72x, respectively, for the class A bonds and highlights that
there is no financial cushion. The equally sized semi-annual
principal repayments ignoring summer and winter wind seasonality
mean that there is less cash available for autumn debt service.
This increases the likelihood of further drawdowns on the class A
DSRA, already partially depleted. Fitch concludes that there may
not be sufficient cash in the reserve to service the class A until
maturity. This positions the rating at 'CCC'.
The balance of principal deferrals on the class B bonds currently
stands at around 37% of the notional, which indicates a clearly
probable default. However, CRC Breeze Finance can defer the
payments of the class B bonds until 2026, when the class A bonds
mature, and the credit risk profile of the class B bonds
corresponds to a 'CC' rating.
PEER GROUP
Caithness Shepherds Flat LLC's (CSF; BB/Positive) is also a
portfolio comprising three US wind farm projects with aggregate
original capacity of 845-megawatts that began commercial operation
in 2012. The difference between CSF's P50 and P90 (one year) wind
resource is of 15.8%, although significantly below CRC Breeze
Finance's wind yield, which is lower than the revised wind
estimates. CRC Breeze Finance has some merchant exposure that goes
from approximately 10% and increases to 20% at the last payment
date. In contrast, CSF earns revenue from three fixed-price
purchase power agreements, mitigating price and demand risk.
CSF's metrics are considerable higher at above 1.3x (post expected
re-powering) while CRC debt service will depend on DSRA
withdrawals. CRC Breeze Finance's class B's scheduled maturity was
2016 but payments can be deferred until the class A bonds reach
their maturity in 2026. However, Fitch does not see this as a
significant benefit for CRC Breeze Finance as the high amount of
deferrals, their subordination to the class A notes and the fully
depleted class B notes' DSRA mean full repayment of the class B
bonds remains unlikely.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
Not applicable as the rating has been withdrawn.
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
Not applicable as the rating has been withdrawn.
CREDIT UPDATE
The DSRA balance has reduced to around EUR5.2 million, below 40% of
the target balance initially agreed. As of November 2022, deferrals
under Tranche B were around EUR18 million and EUR0.42 million of
principal and interest respectively.
Management presented bondholders with a set of proposals with the
aim of increasing operational efficiencies and initiating a sale of
the portfolio. The class B bondholders gave consent at the end of
December 2022 and the class A and C Bonds bondholders in
mid-January 2023.
FINANCIAL ANALYSIS
Fitch Cases
Fitch's base and rating cases are based on historical average
revenues. This assumption changes over time in Fitch's reviews, as
the project yields more historical data. Fitch's rating case also
includes an additional 15% stress on costs.
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.
Entity/Debt Rating Prior
----------- ------ -----
CRC Breeze Finance
S.A., (Breeze II)
CRC Breeze Finance
S.A., (Breeze II)/
Debt/2 LT LT CC Affirmed CC
CRC Breeze Finance
S.A., (Breeze II)/
Debt/2 LT LT WD Withdrawn CC
CRC Breeze Finance
S.A., (Breeze II)/
Debt/1 LT LT WD Withdrawn CCC
CRC Breeze Finance
S.A., (Breeze II)/
Debt/1 LT LT CCC Affirmed CCC
EUROFINS SCIENTIFIC: Fitch Gives 'BB' Rating on Subordinated Notes
------------------------------------------------------------------
Fitch Ratings has assigned Eurofins Scientific S.E.'s (BBB-/Stable)
EUR600 million 6.75% and EUR400 million 3.25% perpetual deeply
subordinated notes 'BB' final instrument ratings.
These hybrid notes rank senior only to Eurofins share capital,
while coupon payments can be deferred at Eurofins' discretion and
deferrals of coupon payments are cumulative. The securities
therefore qualify for 50% equity credit as they meet Fitch's
criteria for subordination, and hence are rated two notches below
the IDR.
A portion of the issuance will be used to refinance Eurofins'
residual outstanding EUR183 million of its EUR300 million hybrid
callable in April 2023, which does not qualify for equity credit
under Fitch's methodology. This transaction will return the
company's hybrid balance to EUR1 billion, a level which Fitch's
rating analysis considers a permanent amount of hybrid debt in
Eurofins' capital structure, after temporarily reducing that amount
when it called its EUR300 million instrument that was considered as
100% debt in August 2022.
KEY RATING DRIVERS
Equity Treatment to Issuance: The issuance qualify for 50% equity
credit as they meet Fitch's criteria for deep subordination
compared with other senior unsecured issuance, given their
remaining effective maturity of at least five years, full
discretion to defer coupons, no events of default, and coupon
step-ups within Fitch's aggregate threshold of 100bp. These are
equity-like characteristics, and allow Eurofins more financial
flexibility.
Cumulative Coupon Limits Equity Treatment: Interest coupon
deferrals are cumulative and to be settled in cash, which limits
the equity credit to 50%. Despite the 50% equity credit, Fitch
treats coupon payments as 100% interest. Eurofins will be obliged
to make a mandatory settlement of deferred interest payments under
certain circumstances, including the declaration of a cash
dividend. This is a feature similar to debt-like securities and
reduces the company's financial flexibility.
Leading Market Positions: The ratings reflect Eurofins' established
and growing global position in bio-analytical-testing services
structured around four businesses: food; environment;
pharma/biotech, and clinical diagnostics. Eurofins has wide
diversification in end-markets for these specialist areas, along
with solid competitive advantages that translate into steady
organic sales growth and resilient profitability. All this results
in a defensive, infrastructure-like business model, protected by
high barriers to entry with scale-driven efficiencies,
technological knowledge and service quality, all leading to
moderate business risks.
Business Mix, Leverage to Normalise: Eurofins' financial leverage
significantly improved during 2020-2022, due to the pandemic
windfall, and supported by proven financial discipline. Assuming a
normalising financial performance and business mix (based on the
assumption of Covid-19 becoming endemic with limited threat from
new variants), Fitch expects EBITDAR net leverage to normalise from
2023 to within 2.5x-3.0x, which is comfortable for a 'BBB-'
rating.
Improving Rating Headroom: Its rating case expects investment in
organic growth, complemented by prudent acquisitions and a stable
dividend pay-out ratio, to drive free cash flow (FCF) margin
towards mid-single digits and to gradually improve rating headroom
over its rating horizon to 2025, as reflected in its Stable
Outlook. Continued strengthening of Eurofins' core businesses
through a well-executed expansion strategy while maintaining
conservative capital allocation with EBITDAR net leverage below
2.5x could be positive for the ratings.
DERIVATION SUMMARY
Fitch compares Eurofins' rating with that of lower-rated European
clinical testing peers and of larger investment-grade US peers in
the life sciences and diagnostics sectors.
Eurofins is similar in scale to Agilent Technologies, Inc.
(BBB+/Stable) and Quest Diagnostics Inc. (BBB/Stable), larger than
PerkinElmer, Inc. (BBB/Stable), Bio-Rad Laboratories Inc.
(BBB/Stable) and Synlab AG (BB/Stable). It is much smaller than
Thermo Fisher Scientific Inc. (BBB+/Stable) but much larger than
'B'- rated peers like Laboratoire Eimer Selas (B/Stable) and Inovie
Group (B/Stable).
Eurofins' profitability sits at the low end of the peer group, with
EBITDAR margin around the low end of 20%, versus those of Thermo
Fisher, Agilent, Quest, PerkinElmer, and Synlab at mid-to-high 20%.
Eurofins' EBITDAR margins are in line with those of Bio-Rad.
After significant deleveraging in 2020 and 2021, Fitch expects
Eurofins' EBITDAR net leverage to remain around 2.5x, which is
still higher than that of other 'BBB'-rated peers like Quest,
Agilent, Bio Read, and PerkinElmer.
KEY ASSUMPTIONS
Fitch's Key Assumptions Within Its Rating Case for the Issuer
- Organic revenue growth excluding Covid-19 tests and reagents at
high single digits over 2022-2025
- Revenue from Covid-19 tests and reagents at EUR400 million in
2022, with no more contributions thereafter
- Net acquisitions of around EUR500 million over 2022-2025
- Fitch-defined EBITDAR margin at 21%-22% through to 2025, a
decrease from 2021 due to the reduction of revenue from Covid-19
tests
- Capex at 7.5% of revenue over 2024-2025, down from 8% in
2022-2023
- Working-capital outflows averaging EUR100 million per year to
2025
- Dividend of about EUR140 million in 2023-2025, from EUR180
million in 2022, reflecting an estimated 25% dividend pay-out
ratio
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
- Continued strengthening of Eurofins' core business risk profile
and conservative capital allocation leading to EBITDAR net leverage
below 2.5x on a continuing basis
- EBITDAR margin sustainably at or above 22%, translating into
consistently positive FCF
- EBITDAR fixed charge coverage, defined as EBITDAR / (interests +
rents), above 6.0x
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
- Weakening of business profile or change of financial policies
leading to EBITDAR net leverage above 3.5x on a continuing basis
- EBITDAR margin below 20%, translating into FCF margin below 2% on
a sustained basis
- EBITDAR fixed charge coverage consistently below 4.5x
LIQUIDITY AND DEBT STRUCTURE
Satisfactory Liquidity: Fitch views liquidity as satisfactory based
on its estimated year-end freely available cash balance of around
EUR600 million (after Fitch restricts EUR50 million) as of
end-December 2022, and access to over EUR1 billion undrawn credit
facilities maturing after 2023. Fitch forecasts Eurofins' liquidity
to remain satisfactory given its expectation of sound cash flow
generation. Furthermore, the company's EUR600 million issuances
provide it with adequate flexibility to meet its next maturity in
July 2024.
ISSUER PROFILE
Eurofins is a global leader in bioanalytical testing, with more
than 800 laboratories. It is highly diversified by end-market and
holds number 1 or 2 positions in most of its business lines.
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.
Entity/Debt Rating
----------- ------
Eurofins Scientific
S.E.
Subordinated LT BB New Rating
=====================
N E T H E R L A N D S
=====================
NEILSENIQ: S&P Affirms 'B' ICR, Outlook Stable
----------------------------------------------
S&P Global Ratings affirmed its 'B' issuer credit rating on
Intermediate Dutch Holdings (d/b/a Nielsen IQ) and the outlook is
stable. At the same time, S&P assigned its 'B' issue-level rating
and '3' recovery rating to the company's proposed senior secured
facilities.
The stable outlook reflects S&P's expectation that NIQ successfully
integrates the GFK acquisition, and its transformation and
cost-cutting initiatives such that leverage declines below 6.5x and
free operating cash flow (FOCF) to debt increases above 5% in
2024.
Nielsen IQ, a global provider of critical retail measurement data,
services, and analytics, is acquiring Germany-based retail
measurement company GfK SE. To fund the acquisition, it is issuing
$1.975 billion of new senior secured first-lien term loans (in
multiple tranches denominated in U.S. dollars and euro) as well as
increasing its first-lien revolving credit facility to $638 million
from $388 million. The new term loan will have the same 2028
maturity as the existing debt and the revolving credit facility
will still have a 2026 maturity.
S&P said, "The acquisition will delay NIQ's de-leveraging path
until 2024. We had expected NIQ to materially start to de-lever in
2023 as it realized the benefits from its cost-reduction efforts
that it put in place after Advent acquired the company in 2021.
However, we now expect material de-leveraging to occur in 2024 as
the company is adding $1.5 billion of pro forma debt to fund the
acquisition of GfK and will realize the synergy benefits from the
transaction over the next 12 to 18 months. Additionally, even as
NIQ has realized $247 million in cost reductions over the past two
years, it is increasing its target by an additional $214 million
that it plans to realize fully by 2024.
"We expect the investment to achieve the additional cost reductions
and the costs to integrate GfK to be about $230 million (about $60
million higher than the company's expectations) over the next 12 to
18 months and to depress EBITDA and cash flow in 2023 before the
company approaches a more normalized rate in 2024, when we expect
S&P Global Ratings-adjusted leverage to decline to 6x from about
10x (the approximately $230 million of one-time costs to achieve
synergies are not added back to S&P's calculation of EBITDA and
capitalized software development costs are treated as an operating
expense) in 2023. While the pace of de-leveraging has been delayed
due to the acquisition and additional costs to achieve further cost
reductions, our expectation is that NIQ should experience
meaningful EBITDA improvement starting in the second half of 2023
as it starts to realize the benefits of its cost reduction efforts
and as the magnitude of one-time costs begins to taper off. If the
company is not experiencing improving EBITDA trends starting in the
second half of 2023 this would be an indication that it is not
generating the magnitude of cost savings expected and that it may
not achieve the reduction in leverage that we are forecasting for
2024 making it more difficult to maintain credit metrics consistent
with the 'B' rating."
The acquisition of GfK SE will increase NIQ's scale. The
combination of NIQ and GfK adds both product and geographic scale
to the combined business. NIQ is already one of the leading global
retail measurement companies with a presence in more than 90
countries and maintains deep relationships with many global
packaged good companies and key retailers. The company also holds a
leading position in all major developed markets and many emerging
markets around the globe with clients in these sectors. The
acquisition of GfK will add market leadership in measurement for
the technology and durables sectors with a leading market presence
across Europe. The combination also gives NIQ the opportunity to
expand GfK's business into new markets, particularly in the U.S.,
where NIQ has a strong presence and long-standing client
relationships.
NIQ's revenue growth has improved and should be resilient even in a
global macroeconomic downturn. NIQ is starting to show traction on
its efforts to return to growth after NIQ had experienced years of
market share losses and revenue declines before it was purchased by
Advent in 2021. Since 2021, NIQ has invested significantly in
improving its technology platform and data capabilities to better
compete with competitors. These efforts have helped the company
improve retention rates and offer more robust product offerings to
clients resulting in organic growth rates approaching a
mid-single-digit percent rate in 2022. S&P said, "We expect the
combined company to continue to grow organically at around 5% in
2023 and 2024 due to a combination of improving retention rates,
more robust product offerings, and modest price increases. We do
not expect significant negative impact from the increasing
macroeconomic uncertainty that we expect in 2023 due to the large
amount of recurring revenue (greater than 80%) and the multiyear
nature of the contracts with most of its customers."
The stable outlook reflects S&P's expectation that NIQ successfully
integrates the GFK acquisition, and its transformation and
cost-cutting initiatives such that leverage declines below 6.5x and
free operating cash flow (FOCF) to debt increases above 5% in
2024.
S&P could lower its rating on NIQ over the next 12 months if it
expects adjusted leverage will remain over 6.5x and FOCF to debt
below 5% on a sustained basis. This could occur if:
-- NIQ is unable to successfully integrate GFK and/or its
transformation and cost initiatives do not materialize as expected.
This would likely be the case if NIQ does not start to generate
sequentially improving EBITDA and cash flow starting in the second
half of 2023;
-- NIQ faces a more competitive landscape that leads to market
share and client losses and slower-than-expected growth trends; or
-- NIQ makes large debt-financed acquisitions or distributions.
While unlikely, S&P could raise the rating on NIQ over the next 12
months if it increases its revenue and improves its credit metrics,
including reducing leverage below the mid-5x area and generating
FOCF to debt around 10% on a sustained basis. This could occur if:
-- The company successfully integrates the GFK acquisition and
realizes the full benefits of its transformation and cost reduction
initiatives;
-- NIQ accelerates growth to the high single digit percent area
that coupled with successful integration and cost reductions
results in S&P adjusted EBITDA margin approaching the high teens;
and
-- It maintains a prudent financial policy with no large
debt-financed acquisitions or dividends that could elevate
leverage.
ESG credit indicators: E-2, S-2, G-3
NIELSENIQ: Moody's Cuts CFR to 'B2', Outlook Remains Stable
-----------------------------------------------------------
Moody's Investors Service downgraded Intermediate Dutch HoldCo
(NL)'s ("dba NielsenIQ") corporate family rating to B2 from B1 and
the probability of default rating to B2-PD from B1-PD. Moody's
also downgraded NielsenIQ's subsidiary, Indy US Holdco, LLC's (US
Holdings) senior secured credit facility ratings, including the
proposed incremental senior secured credit facilities, to B2 from
B1. The rating outlook remains stable.
To fund the proposed merger transaction with GfK SE (GfK, B1
stable), NielsenIQ plans to issue approximately $1.975 billion in
incremental term loans and upsize the revolving credit facility by
$250 million in two steps. The initial use of proceeds contemplates
a $475 million term loan to repay borrowings under its existing
revolving credit facility ($318 million outstanding at September
30, 2022) and an upsize of the revolver by $120 million to bolster
liquidity. The subsequent use of proceeds reflects an additional
$130 million upsize of the revolver to $638 million and a raise of
$1.5 billion equivalent in a single tranche of USD and EUR
denominated incremental term loans that are fungible to the initial
$475 million term loan. The subsequent step is conditioned on the
closing of the GfK merger, and will close and fund concurrently
with the closing of the merger. The net proceeds from the
subsequent borrowings will be used in combination with the cash
raised in the first step to pay $1 billion to GfK's existing
shareholders and repay approximately $500 million of GfK's existing
debt. Moody's expects the revolver to remain undrawn upon closing
of the merger in Q1 2023.
"The downgrade reflects the increase in debt and financial leverage
to fund the GfK merger and Moody's expectation that there are
significant execution risks to reducing financial leverage to less
than 5.5x within two years of the merger", said Mikhil Mahore, a
Moody's analyst. "However, the merger is strategically positive
because GfK will broaden NielsenIQ's product offerings and
significantly improve its scale, market leadership and geographic
diversity."
Moody's doesn't expect significant regulatory hurdles with the
merger. However, ratings will be re-evaluated if the closing of the
GfK merger or its funding are unsuccessful.
Downgrades:
Issuer: Intermediate Dutch HoldCo (NL)
Corporate Family Rating, Downgraded to B2 from B1
Probability of Default Rating, Downgraded to B2-PD
from B1-PD
Issuer: Indy US Holdco, LLC
Senior Secured 1st Lien Bank Credit Facility,
Downgraded to B2 (LGD3) from B1 (LGD3)
Outlook Actions:
Issuer: Intermediate Dutch HoldCo (NL)
Outlook, Remains Stable
Issuer: Indy US Holdco, LLC
Outlook, Remains Stable
RATINGS RATIONALE
NielsenIQ's B2 CFR is constrained by: (1) limited industry
diversity, with a majority of its business tied to large consumer
goods companies despite diversifying to technology and durables
with the proposed GfK merger; (2) Moody's expectation of
debt/EBITDA to remain above 5.5x in 2023 and 2024; and (3) event
risk of financial leverage remaining high given its ownership by
private equity.
The ratings benefit from: (1) leading global positions as a
provider of data and analytics to consumer goods and retail
clients; (2) Moody's expectation that EBITDA growth from cost
reduction initiatives and improving revenue will enable natural
financial deleveraging; (3) good global geographic diversity, with
operations in about 80 countries; and (4) a long track record of
strong recurring revenue because its offerings are embedded into
clients' business processes.
The company's lower EBITDA than Moody's expected prior to the GfK
merger and increased financial leverage post the GfK merger, raises
concerns about governance considerations, specifically credibility
and financial policy.
NielsenIQ has adequate liquidity. Pro-forma for the GfK merger and
proposed financing, sources approximate $720 million to cover uses
of about $290 million through 2023. Liquidity is supported by
Moody's estimate of about $85 million of cash at merger transaction
close and full availability under the proposed upsized $638 million
revolving credit facility expiring in 2026. Cash uses are comprised
of Moody's expectation of free cash flow consumption of about $250
million and about $38 million annual term loan amortization
payments. NielsenIQ is subject to a springing first lien leverage
ratio under its revolving credit facility and Moody's expects it to
be in compliance over the next twelve months. The company has
limited ability to generate liquidity from asset sales.
NielsenIQ has one class of secured debt, all rated B2. NielsenIQ's
subsidiary, Indy US Holdco, LLC, is the borrower, with Dutch and US
subsidiaries, Indy Dutch Bidco B.V., and Nielsen Consumer Inc. as
co-borrowers. All material subsidiaries of the borrowers and
NielsenIQ are guarantors. The security package is comprised of all
assets of the borrowers and the guarantors. Upon closing of the GfK
merger, all the secured debt will receive guarantees and security
from GfK's subsidiaries. The existing term loans and the revolver
are rated at the same level as the corporate family rating (CFR)
because secured debt makes up the preponderance of the debt
capital.
The stable outlook reflects reduction in leverage to below 6x over
the next 12-18 months driven by higher revenue resulting from
company's ongoing investments, strong renewals and pricing
increases as well as some margin improvement as the company
executes its cost reduction program.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The ratings could be upgraded if the company is able to generate
sustainable revenue and EBITDA growth in the low-to-mid-single
digits, debt to EBITDA is sustainably below 5.5x and trends toward
5x, and liquidity improves.
The ratings could be downgraded if there is material revenue or
EBITDA decline, debt to EBITDA is sustained above 6.5x,
EBITDA/interest is below 1.5x, or liquidity weakens.
The principal methodology used in these ratings was Business and
Consumer Services published in November 2021.
NielsenIQ, headquartered in Chicago, Illinois, is a global provider
of retail measurement data, services and analytics to consumer and
retail customers.
TCG ACQUISITIONCO: Moody's Alters Outlook on 'B2' CFR to Stable
---------------------------------------------------------------
Moody's Investors Service affirmed the B2 corporate family rating
and B2-PD probability of default rating of TCG AcquisitionCO B.V.
Concurrently, the rating agency affirmed the B2 instrument ratings
of the EUR589.3 million senior secured term loan B maturing in
September 2028 and the EUR90 million senior secured revolving
credit facility (RCF) maturing in March 2028. Moody's also changed
the outlook to stable from negative.
In May 2022, TCG upsized its senior secured term loan B to EUR589.3
million from EUR315 million and the senior secured RCF to EUR90
million from EUR65 million. The proceeds from the incremental
senior secured term loan B were used to fund the acquisition of
Hellas Construction Inc. (Hellas) for an equivalent of
approximately EUR323 million as well as repay EUR35.2 million
outstanding under its RCF, drawn to fund the acquisition of
GeoSport Lighting, and pay transaction costs. Crestview, a US
private equity firm which owns the majority of TCG, also
contributed equity financing, which together with equity rolled
over from Hellas and TCG management comprised about 30% of the
total purchase price.
RATINGS RATIONALE
The outlook change and ratings affirmation reflect the company's
progress in 2022 in leverage reduction despite the progressively
weakening macroeconomic environment, cost inflation and ongoing
supply chain bottlenecks. The rating action also takes into account
Moody's expectation that TCG's credit metrics will continue to
improve over the next 12-18 months, with Moody's-adjusted
debt/EBITDA declining below 5.5x in 2023 on revenues sustained
close to the levels reached in 2022 and recovery of profitability
in the underlying business, which will also support modest positive
free cash flow (FCF) generation. The company's liquidity is
adequate, albeit currently tight as a result of large RCF drawings
following high working capital consumption in 2022. TCG does not
hedge its floating rate debt, and rising interest rates will
further burden FCF generation. The outlook change and affirmation
of the B2 also incorporate expectations for liquidity to improve.
The rating agency estimates that TCG's Moody's-adjusted debt/EBITDA
declined to around 6.1x as of September 30, 2022 from 6.9x in 2021,
both pro forma for the acquisition of Hellas and other smaller
companies, and further down to around 5.5x as of end-2022. TCG
gained market share, passed through cost inflation to its customers
with two price increases in 2022 with no evidence of meaningful
adverse impact on demand, and integrated Hellas without significant
disruptions to either business.
Despite some visibility into 2023 from the currently strong
orderbook of EUR504 million as of year-end 2022 (up from EUR342
million a year earlier, pro forma for acquisitions), with the
weakening macroeconomic conditions and consumer sentiment in TCG's
key markets, particularly in Europe, which accounts for around 20%
of total revenue and a quarter of total EBITDA, customer demand may
potentially soften, and some order cancelations remain possible.
Moody's forecasts the company's revenue to remain broadly flat in
2023 compared to EUR1,153 million generated in 2022 (proforma for
acquisitions), with a further growth in low single digits as GDP
growth slowly picks up and economic conditions improve in the US
and Europe. EBITDA expansion will be driven by a recovery in
profitability as a result of recent renegotiation of the key raw
materials purchase price formula as TCG continues to gain scale.
However, persistently high inflation will pressure TCG's cost base,
and the agency expects the company to continue passing at least
most of the cost increase to its customers without significant
adverse impact on demand. Non-operating items, such as acquisition
costs, restructuring and other cash one-off items will continue to
weigh on Moody's-adjusted EBITDA. As a result, Moody's forecasts
TCG's Moody's-adjusted EBITDA margin to be around 12% over the next
12-18 months up from around 10.5% estimated for 2022, which will
lead to further leverage reduction to around 5.0x by end-2023 from
5.5x estimated as of end-2022, absent significant debt-funded
acquisitions.
The agency expects TCG to generate positive FCF in the low-double
digit range in 2023 on the back of higher earnings, lower working
capital consumption, and capital spending (including leases) of
around 3% of revenue. Management indicated no plans for shareholder
distributions and that the company will focus on leverage reduction
and use of excess cash to further consolidate highly fragmented
industry. TCG has a reasonable cushion under its interest cover
ratio of around 2.5x Moody's-adjusted EBITA/interest expense
estimated for 2022 (pro forma acquisitions) to absorb further
interest rate increases. Moody's forecasts TCG's interest cover to
decline towards around 1.7x Moody's-adjusted EBITA/interest expense
briefly in 2023, if the ECB increases its policy rate by another 75
basis points.
Weaker than expected economic conditions in the US and Europe would
likely soften demand for the company's products and make it harder
to pass through cost inflation, and more severe supply chain
bottlenecks would have a significant impact on TCG's ability to
execute on its strong order backlog, posing downside risk.
Since 2017, TCG expanded along the entire artificial turf value
chain through organic growth and the acquisition of about 17 small
to medium size companies. Moody's expects TCG to continue to direct
the majority of its FCF to further consolidate the fairly
fragmented industry and strengthen its market position. Continuous
bolt on acquisitions will likely help to deleverage the group's
balance sheet through incremental EBITDA at favourable multiples,
but at the same time expose the company to integration risk and
potentially require additional financing. Thus far, integration has
occurred without significant disruption. Further debt-funded
acquisitions cannot be ruled out and represent event risk that
Moody's would assess on a case-by-case basis based on size,
funding, and expectations for growth as well as integration risk.
TCG's (1) leading market position in the upstream, mid and
downstream segments in a very fragmented industry, (2) moderately
growing end markets at mid-to-high single digits in sports and
high single digits in landscaping as artificial turf allows for
increased usage and water savings compared to natural grass; (3)
vertical integration along the value chain, which supports margins;
(4) widely diversified customer base with relatively low churn; (5)
some track record of improving operating performance and
integrating several acquired companies over the past 5 years
reflected in an EBITA-Margin of around 7% for the twelve months
that ended September 30, 2022 (pro forma for acquisitions) and
expected to improve towards 9% in 2023, as well as a strong backlog
providing some visibility for 2023; and (6) potential for
relatively good cash generation due to moderate working capital and
maintenance capex requirements support its B2 CFR.
The rating also reflects the company's (1) relatively modest albeit
improved size with EUR1,153 million of revenue in 2022 pro forma
for the acquisitions; (2) aggressive financial policy and
relatively high leverage for the B2 rating at around 6.0x as of
September 30, 2022 (pro forma for acquisitions); (3) fairly limited
product and production diversification with 7 manufacturing plants
producing artificial turf for sports and landscape end-markets; (4)
highly competitive end markets, especially in the sports segment
(about 82% of EBITDA in 2022) where most new contracts are awarded
through public or private tenders (5) execution risk to integrate
the numerous bolt-on acquisitions and to achieve the envisaged
synergies from prior acquisitions, including Hellas; and (6)
relatively tight liquidity position, though still adequate, due to
higher drawings under the RCF.
LIQUIDITY
TCG has adequate liquidity. As of December 31, 2022, the company's
liquidity comprised EUR40 million in cash supported by EUR39
million availability under its EUR90 million long-term committed
RCF and funds from operations of over EUR70 million that Moody's
expects the company to generate in 2023. These liquidity sources
will accommodate the company's cash needs over the same period. The
cash requirements are largely for working cash, which is typically
3% of annual sales, seasonal working capital swings, capital
spending of around EUR35 million (including lease principal
payments) that Moody's forecasts, as well as upcoming debt
maturities of less than EUR3 million. No significant debt
repayments are due until 2028 when the company's senior secured
term loan B and RCF mature.
The RCF has a springing net leverage covenant at 8.0x, which only
will be tested if the RCF is drawn by more than 40%. Moody's
expects TCG to remain well below the covenant level if tested.
STRUCTURAL CONSIDERATIONS
The B2 rating on the EUR589.3 million senior secured term loan B
maturing in September 2028 is in line with the CFR and reflects the
dominant position of these secured debt instruments in the capital
structure of TCG. The senior secured term loan B ranks in line with
the EUR90 million RCF maturing in March 2028 and benefits from
upstream guarantees from the main operating subsidiaries
representing in aggregate around 80% of TCG's consolidated EBITDA.
RATIONALE FOR THE STABLE OUTLOOK
The stable outlook reflects Moody's expectation that over the next
12-18 months TCG will be able to gradually increase its profit
margins, reduce leverage and maintain it below 5.5x
Moody's-adjusted debt/EBITDA, generate positive FCF in low-double
digits range, and improve its adequate liquidity from currently
tight levels.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
An upward revision of the rating would likely result from (1)
Moody's-adjusted EBITA margin reaching mid-teens; (2)
Moody's-adjusted gross leverage ratio declining well below 5.0x on
a sustained basis; (3) Moody's-adjusted EBITA/interest coverage at
around 2.75x on a sustained basis; and (4) material sustained
positive FCF generation as evidenced by Moody's-adjusted FCF /debt
in the high single digits in combination with good liquidity.
Downward pressure on the rating could occur if (1) Moody's-adjusted
EBITA margin falls below 10% on a sustained basis; (2)
Moody's-adjusted debt/EBITDA ratio does not reduce over the next
12- 18 months to below 5.5x because of earnings contraction or
material debt funded acquisitions; (3) interest coverage falls
below 1.75x Moody's-adjusted EBITA/interest expense on a sustained
basis; and (4) if the group's liquidity weakens as evidenced by
negative FCF.
PRINCIPAL METHODOLOGY
The principal methodology used in these ratings was Manufacturing
published in September 2021.
COMPANY PROFILE
TCG is a leading manufacturer, distributor and installer of
artificial turf solutions for both sports and landscaping with
reported revenues of EUR1,153 million in 2022 pro forma for the
acquisitions. The company operates a vertically integrated business
model along the artificial turf value chain and has its
headquarters in Nijverdal, the Netherlands with main U.S. offices
in Austin, Texas and Dayton, Tennessee. It is owned by funds
advised from the US based private equity firm Crestview and by its
senior management.
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P O R T U G A L
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GUINCHO FINANCE: Moody's Ups Rating on EUR14MM Cl. B Notes to Ba1
-----------------------------------------------------------------
Moody's Investors Service has upgraded the ratings of Class B Notes
and affirmed the ratings of Class A Notes in GUINCHO FINANCE. The
upgrade reflects better than expected collateral performance which
translates into an increased credit enhancement for the affected
notes with a significant reduction in the advance rate in the last
period. Moody's affirmed the rating of the Notes that had
sufficient credit enhancement to maintain their current rating.
- EUR84 million Class A Notes, Affirmed Baa1 (sf);
previously on Mar 21, 2022 Upgraded to Baa1 (sf)
- EUR14 million Class B Notes, Upgraded to Ba1 (sf);
previously on Mar 21, 2022 Upgraded to Ba3 (sf)
Maximum achievable rating is Aa2 (sf) for structured finance
transactions in Portugal, driven by the corresponding local
currency country ceiling of the country.
RATINGS RATIONALE
Class B Notes upgrade is prompted by better than expected
collateral performance which translates into an increased credit
enhancement for the affected notes. Moody's affirmed the rating of
the notes that had sufficient credit enhancement to maintain their
current rating.
Better than expected collateral performance
Original servicers' expectations for the GUINCHO transaction for
the two last collection periods, which were amongst the highest
periodical figures anticipated in the original business plan, were
not achieved and the transaction is now underperforming its
original business plan (by around 18% on gross collections and 9%
net of legal and procedural costs and deal expenses but gross of
servicers' fees when considering the combination of the three
subpools) compared to around 4% overperformance at the time Moody's
took the last rating action on the transaction. In particular,
collections in the last period were the lowest observed since
closing of the transaction. However, collections are still
exceeding Moody's expectations at closing which were lower than the
original business plan.
The addition of collections to date and servicers' updated
projections in October 2022 business plans are still slightly
higher than their original projections. Gross collections up to
October 2022 as a percentage of the original Gross Book Value
("GBV") stood at around 19% and NPV Cumulative Profitability Ratio
(which compares the sum of the net present values of gross
collections net of Receivables Recovery Expenses received for
Exhausted Debt Relationships compared to the expected in the
original business plan) remains at healthy levels of 158%.
In terms of underlying portfolio, the reported GBV stood at
EUR381.25 million as of October 2022 down from EUR480.75 million at
closing. Portfolio is serviced by Whitestar Asset Solutions, S.A.
(which initially serviced secured loans to individuals and took
over servicing of unsecured loans from Proteus Asset Management,
Unipessoal Lda. ("Altamira") on May 2021) and Hipoges.
Moody's notes that Class B deferral trigger has not been hit up to
date.
NPL transactions' cash flows depend on the timing and amount of
collections. Due to the current economic environment, Moody's has
considered additional stresses in its analysis, including a 6
-month delay in the recovery timing.
Increase in Available Credit Enhancement
The advance rate on Class A Notes, the ratio between Class A Notes'
balance and the outstanding GBV for positions still being worked on
by the servicer, decreased to 2.76% as of November 2022, down from
17.47% at closing and 5.44% as of November 2021. Similarly advance
rate for Class B Notes (the ratio between the Class A and B Notes'
balance and the outstanding GBV) stood at 6.37% as of the same date
down from 20.38% at closing and 8.84% as of November 2021. A lower
advance rate translates into higher protection against credit
losses for the Notes. Indeed when Moody's compare servicer's
expected collections net of costs and fees from November 2022
onwards to the balance of the Notes, the ratio is over 4x for class
A notes. Net collections are applied according to the transaction's
priority of payments with costs and interests ranking senior to
class A notes, but this is a strong coverage. Also for class B
notes, the ratio is over 1.5x.
Class A balance is now at 12.77% of the balance when Moody's rated
the transaction.
Class B Notes do not benefit from the cash reserve in the
transaction. Moody's notes that the unpaid interests on Class B
Notes are deferrable with accruing interest on interest. The rating
of the notes takes into consideration potential future liquidity
constraints when the reserve fund will no longer be available to
cover senior costs and interests.
Counterparty Exposure
The rating action took into consideration the Notes' exposure to
relevant counterparties, such as servicer, or account banks.
Moody's considered how the liquidity available in the transaction
and other mitigants support continuity of Note payments in case of
servicer default. The ratings of the class A Notes are constrained
by operational risk. The transaction does not include a back-up
servicer nor a back-up servicer facilitator. Moody's considers that
the liquidity support provided to the rated notes via the cash
reserve may be used in case of underperformance of the special
servicer, given the nature of the assets. This, in conjunction with
the lack of a back-up servicer, means that continuity of note
payments could be affected in case of servicer disruption.
The principal methodology used in these ratings was "Non-Performing
and Re-Performing Loan Securitizations Methodology" published in
July 2022.
Factors that would lead to an upgrade or downgrade of the ratings:
Factors or circumstances that could lead to an upgrade of the
ratings include: (i) the recovery process of the non-performing
loans producing significantly higher cash-flows in a shorter time
frame than expected; (ii) improvements in the credit quality of the
transaction counterparties; and (iii) a decrease in sovereign
risk.
Factors or circumstances that could lead to a downgrade of the
ratings include: (i) significantly lower or slower cash-flows
generated from the recovery process on the non-performing loans;
(ii) deterioration in the credit quality of the transaction
counterparties; and (iii) increase in sovereign risk.
=============
R O M A N I A
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[*] ROMANIA: Company Insolvencies Up 8.22% to 6,649 in 2022
-----------------------------------------------------------
Razvan Timpescu at SeeNews reports that the number of insolvent
Romanian companies rose by an annual 8.22% in 2022, the country's
trade registry said on Feb. 1.
According to SeeNews, data from the ONRC website showed a total of
6,649 companies were insolvent at the end of last year.
The highest number of insolvent companies and legal entities was
registered in the capital Bucharest, increasing 4.16% on the year
to 1,153, SeeNews discloses.
During 2022, the highest number of insolvent companies was
registered in the wholesale, automobiles and motorcycles servicing
sector (1,826), followed by constructions (1,284), and
manufacturing (848), SeeNews notes.
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S W E D E N
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FASTIGHETS AB: Moody's Ba2 Rating on Jr. Sub. Notes Still on Review
-------------------------------------------------------------------
Moody's Investors Service continues the review for downgrade of all
ratings of Fastighets AB Balder ("Balder"), including the Baa3
long-term issuer rating and senior unsecured bond ratings as well
as the Ba2 junior subordinated notes. The ratings were placed on
review for downgrade on October 18, 2022.
Since the beginning of the review, Balder has undertaken several
refinancing and liability management transactions in Q4 2022,
including the call of its EUR320 million hybrid, supported by a
SEK1.8 billion equity contribution from Swedish pension fund AMF.
Moody's also understand that Balder has made progress in
refinancing upcoming bond maturities by new bank financing and has
reduced bond maturities in 2023 by several tender offers. Moody's
estimate that Balder now covers about 15 months of liquidity needs,
i.e. until and including Q1 2024, while revolving credit facilities
will mature in Q2 2024. Moody's review will focus inter alia on the
strategy and plans of Balder to refinance early on these credit
facilities as well as any other debt maturities.
The improving liquidity profile allows us to assess additional
information included in the group's upcoming full year 2022 results
announcement. Moody's hence expect to conclude the review process
in February 2023. Moody's expect that a downgrade, if any, will be
limited to one notch.
Moody's assessment of full year 2022 results will in particular
focus on the group's short- and medium-term strategic plan, and any
potential guidance related to firm and tangible measures addressing
and managing the group's high debt load and short maturity profile
that continues to expose it to higher refinancing costs. Moody's
will also monitor further progress in raising and renewing bank
credit facilities, so that the group's liquidity profile is akin to
its investment grade rating, covering at a minimum of at least 18
months of estimated cash needs. The review for downgrade will
continue to focus on the strategy of maintaining over time a
Moody's adjusted EBITDA interest rate coverage of at least 3x, a
strategy for shoring up liquidity to manage refinancing needs and
to reduce debt, and hence, leverage in the short to medium term.
Also, more visibility on the direction of valuations and yield
movements in the corresponding markets will be considered and how
the various drivers will affect the group's forward looking credit
metrics, as it relates to fixed charge cover, debt/assets, and net
debt/EBITDA. Most of Moody's fundamental credit concerns persist.
Reverting to secured lending will not shield Balder from higher
interest cost and Moody's believe its fixed charge cover will
remain under pressure as more debt is refinanced at higher rates.
Moody's assessment of the group's highly negative exposure to
governance risks (G-IPS 4), and their highly negative impact on
Balder's rating (CIS-4) remains unchanged and in this tight market
environment investors' focus on those risks could increase.
Balder's complex group structure can create transparency challenges
around asset quality, performance, and potential financial
liabilities, as well as impact the predictability of cash flows.
The complex group structure is reflected by sizeable investments
and joint ventures which are in part fully (giving rise to sizeable
minority interest), in part at equity consolidated assets that in
some instances have no real estate background, such as the sizeable
stake in Collector Bank, but also the ownership of car dealerships
that are operated by Hedin Bil, a company that is part owned by the
majority shareholder of Balder. In addition, Moody's note the
concentrated ownership and effective control by the CEO and
majority shareholder, and his key role in determining the group's
strategy and financial planning, including some appetite for
leverage.
Even though Moody's expect operating income to increase as Balder
passes on inflation in its rents, the capital markets environment
remains extremely challenging with bond markets remaining
prohibitively expensive while banks continue to raise credit
margins as most property companies turn to banks to refinance
maturing bonds. Moody's also view Balder's stand-alone effective
leverage as high at 53% excluding the full consolidation of SATO
Oyj as of Q3 2022 which is not commensurate with its Baa3 rating.
Also, net debt/EBITDA of 15.8x is high even though Moody's expect
it to benefit from higher net rental income in 2023 and to reduce
gradually over 2023 but to remain on an elevated level.
Moody's caution that the prevailing operating conditions will make
it harder post 2023 to continue increase net rental income, in
particular in its commercial portfolio. Rising rates, weak
macroeconomic growth and sustained high inflation will put some
tenants under pressure, which could result in rents starting to
fall and rising vacancies.
=====================
S W I T Z E R L A N D
=====================
COVIS MIDCO 2: Moody's Lowers CFR to Caa3 & Alters Outlook to Neg.
------------------------------------------------------------------
Moody's Investors Service has downgraded the ratings of
patent-protected and mature drugs provider Covis Midco 2 S.a r.l.
(Covis or the company), including its corporate family rating to
Caa3 from B3 and its probability of default rating to Caa3-PD from
B3-PD.
The rating agency has also downgraded all backed senior secured
bank credit facility ratings of financing subsidiary Covis Finco
S.a r.l. to Caa2 from B2 for the first lien bank credit facilities
and to C from Caa2 for the second lien term loan. Concurrently,
Moody's has also changed the outlook on all entities to negative
from ratings under review.
The following factors drove these rating actions, which conclude
the review initiated on October 21, 2022:
-- continued significant declines in revenue
and EBITDA which are unlikely to reverse soon
-- unsustainable capital structure and heightened
risk of a debt restructuring
-- weak liquidity
RATINGS RATIONALE
RATIONALE FOR THE CFR
The downgrade of Covis' CFR to Caa3 from B3 reflects the severity
of the year-to-date September 2022 declines in revenue and EBITDA
of nearly 30% on a like-for-like basis. This continued drop in
performance and Moody's expectation that a stabilisation would not
take place before 2024 have weakened the company's liquidity. While
the rating agency expects that Covis will put in place significant
mitigating plans, it forecasts that Moody's adjusted gross
debt/EBITDA will remain above 10x in the long-term. Therefore,
Moody's holds the firm view that the capital structure is
unsustainable, whether or not the US Food and Drug Administration
(FDA) decides to remove Makena from the market.
Governance considerations were an important driver of the rating
actions. Management's and shareholders' appetite for taking on
material acquisitions, to which legal, competition and execution
risks were attached have weakened the credit quality of Covis.
In 2023, Moody's expects another sharp reduction in revenue to
below $350 million and EBITDA (before exceptionals) below $150
million from around $430 million and $185 million respectively in
2022. The rating agency's base scenario includes the market removal
of Makena, even if the US FDA will only make a final decision in
March 2023 at the earliest. Moody's forecasts a reduction in the
revenue regression for Respiratory and Feraheme. However, the
Respiratory salesforce deployment in Europe with its partner AI
Sirona (Luxembourg) Acquisition S.a.r.l. (Zentiva, B3 stable) will
take several quarters to bear fruit. Furthermore, Covis'
respiratory drugs face competition from innovative products such as
triple therapies. Feraheme will continue to face material price
declines while its market share remains at risk of reducing.
Moody's expects that the capital structure will need to be
addressed in the next 12 to 18 months despite its long-dated nature
because the rating agency views Covis' liquidity as weak. Moody's
believes that the weak liquidity and the absence of EBITDA recovery
prospects given the inherent lack of growth in the product
portfolio make a debt restructuring likely. The Caa3-PD PDR
reflects a high probability of default in the next two years.
LIQUIDITY
In 2023, Covis will be unable to cover its debt service obligations
of around $180 million from available cash and operating cash flow.
Moody's forecasts that the company's liquidity resources of $90
million ($25 million cash and $65 million available under $100
million backed senior secured multi-currency revolving credit
facility – RCF) at the end of December 2022 will be fully
utilised in the next 12 months without additional actions.
In addition to cost savings, Covis has three main options to shore
up its liquidity: (1) reinstating larger receivables factoring
facility commitments toward the previous limit of $75 million
(current drawings were reduced to $14 million as providers pulled
back), (2) selling mature branded products (but this would reduce
annual EBITDA by over $10 million) and (3) out-licensing its rights
to certain respiratory products.
If RCF drawings reach $40 million, the testing condition on the
company's springing net first lien leverage covenant will be met.
In this scenario, Moody's forecasts that Covis would be in breach
by the end of 2023 and the company would require a covenant waiver
to maintain access to the full RCF.
RATIONALE FOR THE INSTRUMENT RATINGS
The Caa2 ratings on the pari passu ranking $595 million backed
senior secured first lien term loan B, EUR309 million backed senior
secured first lien term loan and $100 million RCF, one notch above
the Caa3 CFR, reflect the presence of a relatively large $312
million backed senior secured second lien term loan ranking behind
in the event of security enforcement. As a result, the second lien
term loan is rated C, two notches below the CFR.
In a default scenario, Moody's expects some losses for the first
lien instrument lenders based on an enterprise value between five
and seven times EBITDA. Conversely, the expected loss on the second
lien term loan is very high.
ESG CONSIDERATIONS
Additional governance factors that Moody's considers in Covis'
credit profile include the extensive use of EBITDA add-backs.
Key social risks for Covis include (i) customer relations risks in
the context of legal proceedings regarding marketing practices for
Makena in the US, and (ii) US drug pricing reforms, which Moody's
considers as part of demographic and societal trends.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Moody's could change the outlook to stable or upgrade the ratings
if (i) Makena remains on the market, (ii) liquidity strengthens and
(iii) the probability of default reduces.
Moody's could downgrade Covis' ratings in case liquidity weakens
more rapidly than anticipated or a debt restructuring is announced,
with greater expected loss than Moody's currently forecasts.
LIST OF AFFECTED RATINGS
Downgrades, previously placed on review for downgrade:
Issuer: Covis Midco 2 S.a r.l.
- Probability of Default Rating, Downgraded to Caa3-PD
from B3-PD
- LT Corporate Family Rating, Downgraded to Caa3 from B3
Issuer: Covis Finco S.a r.l.
- BACKED Senior Secured Bank Credit Facility, Downgraded
to C from Caa2
- BACKED Senior Secured Bank Credit Facility, Downgraded
to Caa2 from B2
Outlook Actions:
Issuer: Covis Finco S.a r.l.
Outlook, Changed To Negative From Ratings Under Review
Issuer: Covis Midco 2 S.a r.l.
Outlook, Changed To Negative From Ratings Under Review
PRINCIPAL METHODOLOGY
The principal methodology used in these ratings was Pharmaceuticals
published in November 2021.
CORPORATE PROFILE
Covis, headquartered in Zug (Switzerland) and Luxembourg, markets
and distributes a portfolio of patent-protected and mature drugs in
the respiratory and critical care areas, with presence in over 50
countries. Founded in 2011, it was acquired by funds affiliated
with Apollo Global Management in March 2020. In the 12 months ended
September 30, 2022, Covis had annualised revenue and EBITDA
pre-exceptionals of around $460 million and $200 million
respectively, including certain assets acquired from AstraZeneca.
===========================
U N I T E D K I N G D O M
===========================
BRITISHVOLT: Greybull Capital Emerges as Potential Late Bidder
--------------------------------------------------------------
Peter Campbell, Sylvia Pfeifer and Harry Dempsey at The Financial
Times report that Greybull Capital, the private equity group
associated with the 2019 collapse of British Steel, has emerged as
a potential late bidder for Britishvolt.
Executives from the controversial buyout group met with the defunct
battery start-up's management on Jan. 30 to discuss proposals,
after being brought in recently as a possible saviour, the FT
relays, citing two people with direct knowledge of the process.
Britishvolt, which had ambitions to build the UK's largest battery
factory, collapsed into administration two weeks ago, after the
revenue-less venture ran out of cash and a last-minute rescue deal
was blocked by its creditors, the FT recounts.
Administrators at EY have asked bidders to submit firm offers by
5:00 p.m. on Wednesday, Feb. 1, and are pushing to close the deal
by the end of the week, according to the people, the FT notes.
Greybull is considering whether to submit a final bid, the people
added, the FT relates.
According to the FT, a handful of other possible buyers for
Britishvolt have been lined up, including Australian battery group
Recharge Industries, the Indonesia-linked fund DeaLab, and there is
a bid from a small group of Britishvolt shareholders.
The FT reported on Jan. 30 that Orral Nadjari, Britishvolt's
founder who was ousted as chief executive last summer, is also
preparing a bid for the business.
ELIOT DESIGN: Creditors Unlikely to Receive Payout
--------------------------------------------------
William Telford at PlymouthLive reports that a Plymouth
construction firm that built houses around the city is likely to
leave unpaid debts of almost GBP4 million after going bust.
According to PlymouthLive, liquidators dealing with the fallout
from the collapse of Eliot Design & Build Ltd have already received
claims totalling GBP3.34 million -- but are expecting many more.
The company, which was based at Stoke Damerel Business Centre, went
into liquidation in November 2020 leaving 14 staff out of work and
needing support from the Government's redundancy payment service,
PlymouthLive recounts. A report on the conduct of its directors
has been sent to the Government, PlymouthLive notes.
Documents newly filed at Companies House reveal liquidators were
able to sell the business's headquarters in Church Street, Stoke,
for GBP450,000, leaving GBP151,613 available after Redwood Bank, a
secured creditor mortgage holder, was paid, PlymouthLive states.
About GBP9,000 was also raised in insurance and utility refunds,
and preferential creditors, including the Government's redundancy
service, should receive their cash, PlymouthLive discloses.
But the company's own statement of affairs revealed 187 creditors
were owed GBP3,860,583, PlymouthLive states. So far, 89 claims
amounting to GBP3,342,917 have been received, PlymouthLive notes.
A new annual progress report by liquidators at Castle Hill
Insolvency Ltd said the amount claimed could be even higher than
originally thought as it didn't include claims from other house
builders, according to PlymouthLive.
"The total claims are expected to be significantly higher than
expected at the outset, mainly due to the claims made by other
housing developers. They were originally included in the statement
of affairs as GBP0 as the claims were unquantifiable
pre-liquidation," PlymouthLive quotes the report as saying.
And the liquidators predict none of the unsecured creditors will
receive a penny, PlymouthLive says.
The report, as cited by PlymouthLive., said: "Based on current
information, it is not expected that there will be a dividend
payment to unsecured creditors."
Documents filed at Companies House show banks and other lenders are
owed GBP496,706, including GBP50,000 owed to Barclays Bank,
GBP69,799 to Crowd2Fund and GBP185,000 to Funding Circle Ltd.,
PlymouthLive discloses. The taxman, HM Revenue and Customs, is
owed GBP81,474, and utilities are short of large sums too,
including the GBP101,721 claimed by South West Water, GBP30,615 by
Wales and West Utilities, and GBP38,702 by Western Power
Distribution, PlymouthLive notes.
Among the largest sums owed are those to several Plymouth
businesses, including construction consultancy Bailey Partnership,
short of GBP27,466; while GBP29,438 is owed to Gregory Plumbing and
Heating Ltd, GBP133,487 to K&D Gilbert Ltd, and GBP40,688 to LTC
Scaffolding, according to PlymouthLive. Plymouth City Council is
owed GBP12,814.
The largest sum on a list of creditors is for GBP878,395 -- claimed
by parent company Eliot Group Ltd, which is also now in
liquidation, PlymouthLive states. Documents newly filed by MB
Insolvency reveal the liquidation of this company has now been
concluded, according to PlymouthLive.
SNOWDROP INDEPENDENT: Enters Administration Due to Financial Woes
-----------------------------------------------------------------
Liane McIvor at THIIS reports that specialist mobility aids
retailer Snowdrop Independent Living has gone into administration.
The retailer has advised its staff not to turn up to work and it
has closed all seven of its stores, THIIS relates. Menzies LLP has
been appointed as its administrators, THIIS discloses.
Bethan Evans, business recovery partner at accountancy firm,
Menzies LLP, commented to THIIS: "Having suffered financial
difficulties and having sought advice from insolvency practitioners
at Menzies LLP, regrettably Snowdrop Independent Living Ltd has
ceased trading on Jan. 30.
"All 37 employees have been made redundant with immediate effect.
Regrettably, due to the challenging trading conditions, the
business was failing to hit its revenue forecasts. We will
continue to work with the directors to maximise value for
creditors."
VUE INT'L: Moody's Appends 'LD' Designation to 'Ca-PD' PDR
----------------------------------------------------------
Moody's Investors Service has appended a limited default (/LD)
designation to the Ca-PD probability of default rating of Vue
International Bidco plc, changing it to Ca-PD/LD from Ca-PD.
Moody's will remove the /LD designation from the company's PDR
after three business days.
The /LD designation follows the company's announcement on January
26, 2023 of the completion of its balance sheet restructuring, the
terms of which had originally been announced in July last year. The
transaction included (1) the equitisation of GBP225 million of
first lien debt, representing 28% of the pre-restructuring balance
of the senior debt; and (2) the write-off of all of the second lien
debt, which had totalled GBP245 million including accrued interest.
Following the restructure, Vue's borrowings comprise the EUR94.83
million super senior secured term loan maturing June 30, 2027, and
the reinstatement of the euro-equivalent EUR648.62 million senior
secured term loan maturing December 31, 2027, both of which are
borrowed by Vue Entertainment International Limited (VEIL).
In the process, the equitising first lien lenders received 100% of
the post-restructuring equity (pre-dilution for allocations to
management).
Moody's considers the transaction as a distressed exchange under
its definition of default, which is intended to capture events
whereby issuers fail to meet debt service obligations outlined in
their original debt agreements.
Moody's sees the restructuring as benefiting Vue's liquidity
position in the short term. However, the transaction is not
transformational for Vue's capital structure as leverage (measured
as Moody's-adjusted debt to EBITDA) and interest expense remain
high. Moody's expects Vue will continue to burn cash through the
next twelve months.
Vue is a leading international cinema operator, managing well-known
brands in major European markets, and is the second-largest
European cinema operator by the number of screens. In fiscal 2021,
the company recorded revenue of GBP386 million and EBITDA of GBP24
million.
PRINCIPAL METHODOLOGY
The principal methodology used in this rating was Business and
Consumer Services published in November 2021.
WORCESTER WARRIORS: Atlas Consortium Acquires Club
--------------------------------------------------
James Cohen at MailOnline reports that Worcester Warriors have been
purchased by Jim O'Toole and James Sandford's Atlas consortium.
According to MailOnline, the club confirmed in a statement that Mr.
O'Toole -- who was previously the chief executive of the club --
and Mr. Sanford's bid had been accepted by administrators Begbies
Traynor.
The club had been suspended and removed from the Premiership
earlier this season after entering administration and triggering a
financial crisis in English rugby, MailOnline relates.
"We can confirm that contracts have been exchanged with Atlas,"
MailOnline quotes Julie Palmer, partner at Begbies Traynor, as
saying.
"Following a complex process, we are now able to progress the sale
of Worcester Warriors and associated assets to Atlas Worcester
Warriors Rugby Football Club Limited."
Worcester collapsed into administration and were partially
liquidated this month with HM Customs and Revenue pursuing unpaid
tax in the region of GBP6 million, MailOnline recounts.
The club were relegated from the Gallagher Premiership and
suspended from the Premiership Rugby Cup for the remainder of the
2022-23 season on Oct. 6, MailOnline notes.
*********
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 2023. All rights reserved. ISSN 1529-2754.
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