/raid1/www/Hosts/bankrupt/TCREUR

/raid1/www/Hosts/bankrupt/TCREUR_Public/230824.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, August 24, 2023, Vol. 24, No. 170 Headlines C Y P R U S RONIN EUROPE: S&P Ups LT ICR to 'B+' on Conservative Risk Appetite F R A N C E CASINO GUICHARD: Egan-Jones Retains CCC+ Sr. Unsecured Ratings CONSTELLIUM SE: Moody's Affirms B1 CFR, Alters Outlook to Positive IMERYS SA: Egan-Jones Retains BB+ Senior Unsecured Ratings G E R M A N Y THYSSENKRUPP AG: Egan-Jones Retains BB- Senior Unsecured Ratings I R E L A N D AURIUM CLO III: Moody's Affirms B2 Rating on EUR10.5MM Cl. F Notes NASSAU EURO III: Fitch Gives 'B-sf' Final Rating to Class F Notes NASSAU EURO III: S&P Assigns 'B- (sf)' Class F Notes Rating L U X E M B O U R G ALTISOURCE PORTFOLIO: Egan-Jones Retains CCC+ Sr. Unsecured Ratings N E T H E R L A N D S KONINKLIJKE KPN: Egan-Jones Retains BB Senior Unsecured Ratings N O R W A Y NORWEGIAN AIR: Egan-Jones Retains C Senior Unsecured Ratings U N I T E D K I N G D O M 888 HOLDINGS: Fitch Affirms LongTerm IDR at 'BB-', Outlook Negative AC PLC: Set to Go Into Administration ELCOCK REISEN: Enters Administration, 32 Jobs Affected MONARCH AIRLINES: To Relaunch Six Years Following Collapse NORTH LANDS: Enters Liquidation, 6 Jobs Lost WILKO LTD: Fails to Find Buyer, 12,500 Jobs at Risk WORCESTER WARRIORS: To Remain in Administration as Sale Continues - - - - - =========== C Y P R U S =========== RONIN EUROPE: S&P Ups LT ICR to 'B+' on Conservative Risk Appetite ------------------------------------------------------------------ S&P Global Ratings raised its long-term issuer credit rating on Ronin Europe Ltd. (REL) to 'B+' from 'B'. The outlook is stable. At the same time, S&P affirmed its 'B' short-term issuer credit rating on the firm. S&P said, "We expect REL and the group will continue to manage the bond portfolio in a conservative manner. As interest rates increased over 2022, REL successfully reallocated its portfolio toward less-risky segments. At June 30, 2023, its weighted-average credit quality was about 'BBB+', while the weighted-average duration was about 3.5 years, a modest level compared with many rated peers. Similarly, the quality of the group's weighted-average bonds (excluding unrated Russian securities) stood at 'A-' with a duration of about 2.5 years. We do not expect REL to abruptly change its allocations and believe it will retain this risk appetite. "Client business is set to materially expand but will remain concentrated. We understand REL's customer assets are set to increase materially over 2023. This comes as the group attracts clientele in new regions, resulting in a sizeable projected increase in custody and brokerage fees. However, growth will remain concentrated on a handful of customers, with REL largely still a boutique institution. "We also believe that REL has somewhat reduced its exposure to Russian risks.Specifically, we note that REL terminated relationships with Russian citizens over 2022." It also divested from Russian bonds, which traditionally constituted a material portion of its portfolio, while parent Ronin Partners B.V. spun off the group's Russian operations and continues to reduce the legacy Russian portfolio. REL is the core operational subsidiary of Ronin Partners B.V.REL is the only client-facing business of Ronin Partners B.V. with other operating companies representing predominantly booking balance sheets. Although regulation protects REL from undue group interference, it remains a defining element of the group credit profile, which we consider to be 'b+'. The stable outlook reflects S&P's view that, over the next 12 months, REL's franchise will remain resilient to the volatile and uncertain operating environment stemming from the Russia-Ukraine conflict, sanctions on Russian businesses, and capital controls. S&P also expects that Ronin Partners' actions will remain supportive of REL's credit quality. S&P could lower the long-term rating on REL if: -- Operating conditions materially deteriorate and REL's profitability comes under more pressure, for example because it loses key clients; -- Its group risk appetite materially increases, for example through investments in riskier securities. A positive rating action on REL appears remote in the near term and would require us to take a more positive view of the group's creditworthiness in a peer context. This would involve the following conditions: -- S&P's view that geopolitical risks and spill-over effects from the Russia-Ukraine conflict, particularly risks of sanctions on customers and counterparties, have reduced. -- Ronin group reducing its current exposure to Russian risk or the issue of 'frozen' securities is otherwise resolved. -- REL demonstrating resilient performance, aided by stability of the client base and relationships with counterparties, which would support a rebound in revenue and net income closer to pre-conflict levels. =========== F R A N C E =========== CASINO GUICHARD: Egan-Jones Retains CCC+ Sr. Unsecured Ratings -------------------------------------------------------------- Egan-Jones Ratings Company on August 11, 2023, maintained its 'CCC+' foreign currency and local currency senior unsecured ratings on debt issued by Casino Guichard-Perrachon SA. EJR also withdraws the rating on commercial paper issued by the Company. Headquartered in Saint-Etienne, France, Casino Guichard-Perrachon SA operates a wide range of hypermarkets, supermarkets, and convenience stores. CONSTELLIUM SE: Moody's Affirms B1 CFR, Alters Outlook to Positive ------------------------------------------------------------------ Moody's Investors Service has changed the outlook to positive from stable on Constellium SE. Concurrently, Moody's has affirmed Constellium's B1 corporate family rating, its B1-PD probability of default rating, as well as the B1 rating of its backed senior unsecured notes. "The change of the outlook to positive from stable primarily reflects Constellium continuing to perform ahead of Moody's expectations in a difficult operating environment with persistent inflation, while maintaining financial discipline.", says Martin Fujerik, a Moody's Vice President - Senior Credit Officer and lead analyst on Constellium. "The likelihood has increased that the company will further improve its credit metrics to levels consistent with a higher rating over the next 12-18 months.", adds Mr. Fujerik. RATINGS RATIONALE Constellium has continued to deliver stronger operational results with higher earnings during 2023 than Moody's expected. The company has coped well with lower shipments in some of its key markets and persistent inflation of some input costs, including labour and energy. Strong momentum in the aerospace market - Constellium's most profitable end market - has been the main driver of this better-than-expected performance. Furthermore, the company has maintained discipline in capital allocation and even reduced gross debt during the year. Constellium remains committed to a continued reduction of its reported net leverage to 2.5x, keeping it between 1.5x and 2.5x afterwards. The ratio declined to 2.7x for 12 months to June 2023, a multi-year low, from 2.8x in 2022, while Moody's expected a modest increase. The positive outlook reflects an increasing likelihood that over the next 12-18 months the company will be able to further expand its EBITDA, thus reaching credit metrics that would be commensurate with a higher rating, such as Moody's adjusted gross debt/EBITDA below 4.0x (4.1x for 12 months to June 2023, excluding metals price lag) and Moody's-adjusted (cash flow from operations [CFO]-dividends)/debt at around 20% (17.3%). However, there are uncertainties to this forecast. The macroeconomic environment remains challenging, with a risk of a continued sluggish growth in several of Constellium's end markets, including packaging. Although the rating agency expects volumes in the aerospace market to continue growing, as the market keeps recovering from its pandemic-induced downturn, the exceptionally high EBITDA per ton that Constellium generated in its Aerospace and Transportation segment during H1 2023 might not be sustained. Furthermore, there are still some uncertainties about Constellium's capital allocation priorities once it reaches its 1.5x-2.5x net leverage target range; particularly with regards to shareholder remuneration that it is now likely to start considering. The company also modestly improved its liquidity during H1 2023, which Moody's views as adequate. The rating agency's expectation that Constellium will maintain solid free cash flow (FCF) generation over the next 12-18 months, despite a relatively high level of growth investments, supports this assessment. At the end of June 2023, the company reported around EUR180 million cash and cash equivalents, with around EUR570 million available under its committed lending facilities and factoring arrangements, facing relatively limited and manageable debt maturities until 2026. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS Further upward pressure on the ratings would build, if Constellium's (1) Moody's-adjusted debt/EBITDA reduced sustainably below 4.0x; (2) Moody's-adjusted (CFO - dividends)/debt improved to at least 20%; and (3) Moody's-adjusted FCF remained consistently positive. Negative rating pressure could develop, if Constellium's (1) Moody's-adjusted debt/EBITDA consistently exceeded 5.0x; (2) Moody's-adjusted (CFO - dividends)/debt fell sustainably below 15%; (3) Moody's-adjusted FCF turned sustainably negative; or (4) liquidity deteriorated. PRINCIPAL METHODOLOGY The principal methodology used in these ratings was Steel published in November 2021. COMPANY PROFILE Headquartered in Paris, France, Constellium is a leading producer of a broad range of specialty rolled and extruded aluminium products for several end markets. In 2022, it shipped close to 1.6 million tons of products, generating revenue of around EUR8.1 billion. IMERYS SA: Egan-Jones Retains BB+ Senior Unsecured Ratings ---------------------------------------------------------- Egan-Jones Ratings Company on August 11, 2023, maintained its 'BB+' foreign currency and local currency senior unsecured ratings on debt issued by Imerys. EJR also withdraws the rating on commercial paper issued by the Company. Headquartered in Paris, France, Imerys produces and distributes chemicals, pigments, and additives. ============= G E R M A N Y ============= THYSSENKRUPP AG: Egan-Jones Retains BB- Senior Unsecured Ratings ---------------------------------------------------------------- Egan-Jones Ratings Company on August 3, 2023, maintained its 'BB-' foreign currency and local currency senior unsecured ratings on debt issued by thyssenkrupp AG. EJR also withdraws the rating on commercial paper issued by the Company. Headquartered in Essen, Germany, thyssenkrupp develops and manages real estates, as well as designs and constructs factories. ============= I R E L A N D ============= AURIUM CLO III: Moody's Affirms B2 Rating on EUR10.5MM Cl. F Notes ------------------------------------------------------------------ Moody's Investors Service has upgraded the ratings on the following notes issued by Aurium CLO III Designated Activity Company: EUR41,500,000 Class B-1 Senior Secured Floating Rate Notes due 2030, Upgraded to Aaa (sf); previously on Feb 7, 2022 Affirmed Aa1 (sf) EUR10,000,000 Class B-2 Senior Secured Fixed Rate Notes due 2030, Upgraded to Aaa (sf); previously on Feb 7, 2022 Affirmed Aa1 (sf) Moody's has also affirmed the ratings on the following notes: EUR220,000,000 (Current outstanding amount EUR218,008,489) Class A Senior Secured Floating Rate Notes due 2030, Affirmed Aaa (sf); previously on Feb 7, 2022 Affirmed Aaa (sf) EUR25,500,000 Class C Senior Secured Deferrable Floating Rate Notes due 2030, Affirmed A1 (sf); previously on Feb 7, 2022 Upgraded to A1 (sf) EUR18,000,000 Class D Senior Secured Deferrable Floating Rate Notes due 2030, Affirmed Baa1 (sf); previously on Feb 7, 2022 Upgraded to Baa1 (sf) EUR22,500,000 Class E Senior Secured Deferrable Floating Rate Notes due 2030, Affirmed Ba2 (sf); previously on Feb 7, 2022 Affirmed Ba2 (sf) EUR10,500,000 Class F Senior Secured Deferrable Floating Rate Notes due 2030, Affirmed B2 (sf); previously on Feb 7, 2022 Affirmed B2 (sf) Aurium CLO III Designated Activity Company, issued in May 2017 and refinanced in October 2019, is a collateralised loan obligation (CLO) backed by a portfolio of mostly high-yield senior secured European loans. The portfolio is managed by Spire Management Limited. The transaction's reinvestment period ended in April 2021. RATINGS RATIONALE The rating upgrades on the Class B-1 and B-2 notes are primarily a result of a shorter weighted average life of the portfolio which reduces the time the rated notes are exposed to the credit risk of the underlying portfolio. 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 at the last review in November 2022. Key model inputs: 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: EUR370.6m Defaulted Securities: EUR2.9m Diversity Score: 48 Weighted Average Rating Factor (WARF): 2649 Weighted Average Life (WAL): 3.67 years Weighted Average Spread (WAS) (before accounting for Euribor floors): 3.75% Weighted Average Coupon (WAC): 3.87% Weighted Average Recovery Rate (WARR): 44.07% 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 provider, 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. The collateral manager's investment decisions and management of the transaction will also affect the notes' performance. 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. -- Recovery of defaulted assets: Market value fluctuations in trustee-reported defaulted assets and those Moody's assumes have defaulted can result in volatility in the deal's over-collateralisation levels. Further, the timing of recoveries and the manager's decision whether to work out or sell defaulted assets can also result in additional uncertainty. Moody's analysed defaulted recoveries assuming the lower of the market price or the recovery rate to account for potential volatility in market prices. Recoveries higher than Moody's expectations would have a positive impact on the notes' ratings. 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. NASSAU EURO III: Fitch Gives 'B-sf' Final Rating to Class F Notes ----------------------------------------------------------------- Fitch Ratings has assigned Nassau Euro CLO III DAC final ratings as detailed below. Entity/Debt Rating Prior ----------- ------ ----- Nassau Euro CLO III DAC Class A XS2649197386 LT AAAsf New Rating AAA(EXP)sf Class B XS2649197543 LT AAsf New Rating AA(EXP)sf Class C XS2649197899 LT Asf New Rating A(EXP)sf Class D XS2649198194 LT BBB-sf New Rating BBB-(EXP)sf Class E XS2649198350 LT BB-sf New Rating BB-(EXP)sf Class F XS2649198517 LT B-sf New Rating B-(EXP)sf Subordinated Notes XS2649198780 LT NRsf New Rating NR(EXP)sf TRANSACTION SUMMARY Nassau Euro CLO III DAC is a securitisation of mainly senior secured obligations with a component of senior unsecured, mezzanine, second-lien loans and high-yield bonds. Note proceeds were used to purchase a portfolio with a target par of EUR370 million. The portfolio is actively managed by Nassau Group Credit (UK) LLP (Nassau). The collateralised loan obligation (CLO) has a four-and-a-half-year reinvestment period and a seven-year weighted average life (WAL) test. KEY RATING DRIVERS Average Portfolio Credit Quality (Neutral): Fitch assesses the average credit quality of obligors in the 'B' category. The Fitch weighted average rating factor (WARF) of the identified portfolio is 24.1. High Recovery Expectations (Positive): At least 90% of the portfolio will comprise senior secured obligations. Fitch views the recovery prospects for these assets as more favourable than for second-lien, unsecured and mezzanine assets. The Fitch weighted average recovery rate (WARR) of the identified portfolio is 63.6%. Diversified Portfolio (Positive): The transaction has one matrix at closing, corresponding to a fixed-rate limit of 10% and a top 10 obligor concentration limit at 25%. The transaction also includes various other concentration limits, including the maximum exposure to the three largest Fitch-defined industries in the portfolio at 40%. These covenants ensure that the asset portfolio will not be exposed to excessive concentration. Portfolio Management (Neutral): The transaction has a 4.5-year reinvestment period and includes reinvestment criteria similar to those of other European transactions. Fitch's analysis is based on a stressed-case portfolio with the aim of testing the robustness of the transaction structure against its covenants and portfolio guidelines. Cash Flow Modelling (Positive): The WAL has been reduced to six from seven to model the transaction's stressed portfolio and matrix. This is to account for the strict reinvestment conditions envisaged by the transaction after its reinvestment period. These include, among others, passing both the coverage tests and the Fitch 'CCC' test post reinvestment as well a WAL covenant that progressively steps down over time, both before and after the end of the reinvestment period. Fitch believes these conditions would reduce the effective risk horizon of the portfolio during the stress period. Class F Delayed Issuance (Neutral): The issuer has subscribed to the class F notes at par for a zero net cash price. Post the issue date, the issuer may be required to sell the class F notes at the direction of the subordinated noteholders. In Fitch's view, the issue of the class F notes would reduce available excess spread by the class F interest amount to cure the reinvestment over-collateralisation test. Consequently, Fitch has modelled the deal assuming the tranche is issued on the issue date to reflect the maximum stress the transaction could withstand if that occurs. RATING SENSITIVITIES Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade A 25% increase of the mean default rate (RDR) across all ratings and a 25% decrease of the recovery rate (RRR) across all ratings of the identified portfolio would have no impact on the class A and C notes and would lead to downgrades of no more than one notch for the class B, D and E notes and to below 'B-sf' for the class F notes . Downgrades, which are based on the identified portfolio, may occur if the loss expectation is larger than initially assumed, due to unexpectedly high levels of defaults and portfolio deterioration. Due to the better metrics and shorter life of the identified portfolio than the Fitch-stressed portfolio, the class B, D, E and F notes display a rating cushion of two notches and class C a rating cushion of one notch. Should the cushion between the identified portfolio and the Fitch-stressed portfolio be eroded either due to manager trading or negative portfolio credit migration, a 25% increase of the mean RDR across all ratings and a 25% decrease of the RRR across all ratings of the stressed portfolio would lead to downgrades of up to three notches for the class A to D notes and to below 'B-sf' for the class E and F notes. Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade A 25% reduction of the mean RDR across all ratings and a 25% increase in the RRR across all ratings of the Fitch-stressed portfolio would lead to upgrades of up to three notches for the rated notes, except for the 'AAAsf' notes. During the reinvestment period, upgrades, which are based on the Fitch-stressed portfolio, may occur on better-than-expected portfolio credit quality and a shorter remaining WAL test, leading to the ability of the notes to withstand larger-than-expected losses for the remaining life of the transaction. After the end of the reinvestment period, upgrades may occur on stable portfolio credit quality and deleveraging, leading to higher credit enhancement and excess spread available to cover losses in the remaining portfolio. DATA ADEQUACY The majority of the underlying assets or risk-presenting entities have ratings or credit opinions from Fitch and/or other nationally recognised statistical rating organisations and/or European securities and markets authority-registered rating agencies. Fitch has relied on the practices of the relevant groups within Fitch and/or other rating agencies to assess the asset portfolio information or information on the risk-presenting entities. Overall, and together with any assumptions referred to above, Fitch's assessment of the information relied upon for the agency's rating analysis according to its applicable rating methodologies indicates that it is adequately reliable. NASSAU EURO III: S&P Assigns 'B- (sf)' Class F Notes Rating ------------------------------------------------------------ S&P Global Ratings assigned its credit ratings to Nassau Euro CLO III DAC's class A to F notes. At closing, the issuer also issued unrated subordinated notes. Under the transaction documents, the rated notes pay quarterly interest unless there is a frequency switch event. Following this, the notes will switch to semiannual payment. The transaction has a two-year non-call period and the portfolio's reinvestment period will end approximately 4.5 years after closing. The ratings reflect S&P's assessment of: -- The diversified collateral pool, which primarily comprises broadly syndicated speculative-grade senior secured term loans and bonds that are governed by collateral quality tests. -- The credit enhancement provided through the subordination of cash flows, excess spread, and overcollateralization. -- The collateral manager's experienced team, which can affect the performance of the rated notes through collateral selection, ongoing portfolio management, and trading. Portfolio benchmarks CURRENT S&P Global Ratings weighted-average rating factor 2,744.97 Default rate dispersion 431.57 Weighted-average life (years) 4.61 Obligor diversity measure 125.82 Industry diversity measure 23.24 Regional diversity measure 1.24 Transaction key metrics CURRENT Total par amount (mil. EUR) 370.00 Defaulted assets (mil. EUR) 0 Number of performing obligors 148 Portfolio weighted-average rating derived from its CDO evaluator B 'CCC' category rated assets (%) 0.00 Covenanted 'AAA' weighted-average recovery (%) 36.71 Covenanted weighted-average spread (%) 4.10 Covenanted weighted-average coupon (%) 5.40 Rating rationale S&P said, "Our ratings reflect our assessment of the collateral portfolio's credit quality, which has a weighted-average rating of 'B'. The portfolio is well-diversified, primarily comprising broadly syndicated speculative-grade senior secured term loans and senior secured bonds. Therefore, we conducted our credit and cash flow analysis by applying our criteria for corporate cash flow CDOs. "In our cash flow analysis, we used the EUR370 million par amount, the covenanted weighted-average spread of 4.10%, and the covenanted weighted-average recovery rate at the 'AAA' rating level and the actual weighted-average recovery rate at all other rating levels. We applied various cash flow stress scenarios, using four different default patterns, in conjunction with different interest rate stress scenarios for each liability rating category. "The transaction's documented counterparty replacement and remedy mechanisms adequately mitigate its exposure to counterparty risk under our current counterparty criteria. "Following the application of our structured finance sovereign risk criteria, we consider the transaction's exposure to country risk to be limited at the assigned ratings, as the exposure to individual sovereigns does not exceed the diversification thresholds outlined in our criteria. "We consider that the transaction's legal structure is bankruptcy remote, in line with our legal criteria. "Our credit and cash flow analysis indicate that the available credit enhancement for the class B to E notes could withstand stresses commensurate with higher rating levels than those we have assigned. However, as the CLO is still in its reinvestment phase, during which the transaction's credit risk profile could deteriorate, we have capped our assigned ratings on the notes. The class A notes can withstand stresses commensurate with the assigned rating. Our ratings on the class A and B notes address timely payment of interest and ultimate payment of principal, while our ratings on the class C, D, E, and F notes address the payment of ultimate interest and principal. "Following our analysis of the credit, cash flow, counterparty, operational, and legal risks, we believe that our ratings are commensurate with the available credit enhancement for the class A, B, C, D, E, and F notes. "In addition to our standard analysis, to indicate how rising pressures among speculative-grade corporates could affect our ratings on European CLO transactions, we have also included the sensitivity of the ratings on the class A to E notes based on four hypothetical scenarios." Environmental, social, and governance (ESG) credit factors S&P regards the exposure to ESG credit factors in the transaction as broadly in line with its benchmark for the sector. Primarily due to the diversity of the assets within CLOs, the exposure to environmental credit factors is viewed as below average, social credit factors are below average, and governance credit factors are average. For this transaction, the documents prohibit assets from being related to the following industries: -- Involved in activities that violate the UNGC; -- Obligors identified as being involved in manufacture (or manufacture of components for) of biological or chemical weapons; -- Weapons manufacturing; -- More than 10% of revenue from manufacture of civilian firearms; -- More than 5% of revenue from tobacco production; -- More than 5% of revenue from thermal coal extraction; -- More than 5% of revenue from oil sands extraction; -- Any oil and gas producer deriving less than 40% of revenues from natural gas or renewables; -- Any electricity utility generating more than 1% of electricity from thermals coal, 10% from liquid fuels, 50% from natural gas, or 0% from nuclear generation; -- Any involvement in payday lending; -- More than 50% of revenues from opioids or ozone-depleting substances; -- More than 5% of revenue from the extraction of fossil fuels from unconventional sources; -- Any revenues from pornography or prostitution; -- Any trade in endangered wildlife; or -- Any revenue derived from the production or trade in illegal narcotics (including marijuana). Ratings CLASS RATING* AMOUNT SUB (%) INTEREST RATE§ (MIL. EUR) A AAA (sf) 222.00 40.00 Three-month EURIBOR plus 1.95% B AA (sf) 44.40 28.00 Three-month EURIBOR plus 3.25% C A (sf) 20.40 22.49 Three-month EURIBOR plus 4.25% D BBB- (sf) 24.60 15.84 Three-month EURIBOR plus 6.10% E BB- (sf) 17.00 11.24 Three-month EURIBOR plus 7.46% F† B- (sf) 12.00 8.00 Three-month EURIBOR plus 9.00% Sub notes NR 39.00 N/A N/A *The ratings assigned to the class A and B notes address timely interest and ultimate principal payments. The ratings assigned to the class C, D, E, and F notes address ultimate interest and principal payments. §The payment frequency switches to semiannual and the index switches to six-month EURIBOR when a frequency switch event occurs. †The class F notes is a delayed drawdown tranche, which is not issued at closing. EURIBOR--Euro Interbank Offered Rate. NR--Not rated. N/A—-Not applicable. =================== L U X E M B O U R G =================== ALTISOURCE PORTFOLIO: Egan-Jones Retains CCC+ Sr. Unsecured Ratings ------------------------------------------------------------------- Egan-Jones Ratings Company on August 9, 2023, maintained its 'CCC+' foreign currency and local currency senior unsecured ratings on debt issued by Altisource Portfolio Solutions S.A. EJR also withdraws the rating on commercial paper issued by the Company. Headquartered in Luxembourg, Altisource Portfolio Solutions S.A. provides real estate and mortgage services. ===================== N E T H E R L A N D S ===================== KONINKLIJKE KPN: Egan-Jones Retains BB Senior Unsecured Ratings --------------------------------------------------------------- Egan-Jones Ratings Company on August 2, 2023, maintained its 'BB' foreign currency and local currency senior unsecured ratings on debt issued by Koninklijke KPN N.V. EJR also withdraws the rating on commercial paper issued by the Company. Headquartered in Rotterdam, Netherlands, Koninklijke KPN N.V. is a telecommunications and IT provider in the Netherlands, serving both consumer and business customers with its fixed and mobile networks for telephony, broadband and television. =========== N O R W A Y =========== NORWEGIAN AIR: Egan-Jones Retains C Senior Unsecured Ratings ------------------------------------------------------------ Egan-Jones Ratings Company on August 9, 2023, maintained its 'C' foreign currency and local currency senior unsecured ratings on debt issued by Norwegian Air Shuttle ASA. EJR also withdraws the rating on commercial paper issued by the Company. Headquartered in Baerum, Norway, Norwegian Air Shuttle ASA provides airline services. =========================== U N I T E D K I N G D O M =========================== 888 HOLDINGS: Fitch Affirms LongTerm IDR at 'BB-', Outlook Negative ------------------------------------------------------------------- Fitch Ratings has affirmed 888 Holdings PLC's (888) Long-Term Issuer Default Rating (IDR) at 'BB-'. The Outlook on the IDR remains Negative. Fitch has also affirmed senior secured ratings of debt issued by companies of 888 Group at 'BB+' with a Recovery Rating at RR2'. The Negative Outlook reflects continuing uncertainty over the potential impact on its credit profile from the regulation overhaul in 888's core market. A delay in the UK Gambling Act review reduces visibility on online gaming revenues in the UK. Worse-than-expected regulatory challenges could put pressure on the ratings. Delivery of identified synergies and strict budget discipline remain critical for the rating trajectory. The 'BB-' IDR continues to reflect the strong combined business profile of 888 and William Hill International (WHI) after the WHI acquisition in 2022, with a widely recognised online and retail brand portfolio, as well as a weak, albeit improving, combined financial profile. KEY RATING DRIVERS Profitability Improvement Contingent on Synergies: 888 has realised GBP66 million synergies at an accelerated pace in 1H23, materially exceeding Fitch's forecasts. Fitch now expects an EBITDAR margin of 19.2% in 2023, 350bp higher than in its rating case in August 2022, as higher profitability offsets lower-than-previously forecast revenues. Nevertheless Fitch does not yet have full visibility of the annualised impact on 888's reported results, and see some execution risk regarding the remaining synergies. Smoother Deleveraging Pace: Higher profitability and a focus on deleveraging have resulted in a smoother deleveraging pace compared with its previous rating case. Fitch now expects 888's EBITDAR net leverage at only slightly above its negative rating sensitivity of 6.0x in 2023, compared with its previous forecast of 6.7x. By end-2026, ahead of large maturities in 2027-2028 Fitch expects 888 to deleverage to 4.4x, a comfortable level for the 'BB' category. Regulatory Impact Anticipated: Similar to its peers, 888 has been rolling out responsible gaming and customer safety measures since 2021 in anticipation of regulation change in the UK. This continues to affect revenues generated in UK online markets, with 2Q23 online revenues down 10% YoY, and 33% compared with 1Q21. However, it also led to an increase of recreational players to over 80% in 2Q23 versus less than 60% in 1Q21. Some implemented measures such as online stake limits at GBP5-GBP10 are quite low and comparable to retail spin limit of GBP2-GBP5. Fitch does not exclude more strict restrictions and forecast low single-digit revenue decline in UK online for 888 in 2024 and 2025, in contrast to management's expectations of no incremental financial impact from the UK Gambling Act review. Low Fixed Charge Cover: Despite an increase in forecast EBITDA, 888's fixed charge cover will likely remain around the negative sensitivity of 1.8x, at least until 2025. High debt quantum and high interest cost will continue to erode EBITDA cash conversion. However, interest on 70% of its debt remains hedged, which reduces the downside for further fixed charge cover deterioration. Corporate Governance Record: Know Your Client procedure failures that led to a VIP accounts freeze in January 2023, unanticipated top management changes and minority shareholder suitability concerns from the UK regulator, underline 888's weak recent record of corporate governance. High regulatory scrutiny on the gaming business means corporate governance issues could lead to higher regulatory risks. At the same time, Fitch acknowledges 888's cooperation with regulators and the self-reported nature of some of incidents in its international markets, and view license-suspension risks as very limited. Share of Less Regulated Markets: Despite receiving 95% of revenue from locally regulated or taxed markets as of 2Q23, 888 continues to actively develop its growth and pipeline markets, some of which are not fully regulated. Their higher profitability may provide a boost to margins and improve brand perception in case these markets become regulated. However, they also have higher volatility of revenues and profits over the medium term, including extreme cases of part or full market closures or legal challenges and claims. Strong Brand Portfolio: Both WHI and 888 enjoy strong brand recognition in the UK market. Fitch’s view established brands as less vulnerable to possible regulatory restrictions on advertising in gaming. Its forecast assumes that 888 and WHI will maintain their strong market positions, supported by marketing synergies and combined technological and business expertise. DERIVATION SUMMARY 888's post-acquisition business profile can be compared with Flutter Entertainment Plc's (Flutter, BBB-/Stable) and Entain Plc's (Entain, BB/Stable), given their similar portfolio of strong brands, but smaller scale and slightly weaker geographical and product diversification. However, Fitch expects 888 to have higher leverage and lower profitability over the first two to three years post the WHI acquisition, which translate into its rating differential with Flutter and Entain. All three entities have high exposure to the UK market and are vulnerable to regulatory risk, which is factored into their current ratings. Of these three, 888 has the highest exposure to the UK and highest share of gaming revenues, making it more vulnerable to potential adverse regulations. Post-acquisition, 888 has a similar scale to but is more leveraged than Allwyn International a.s. (BB-/Stable). Its organic growth potential of online gaming and betting is offset by higher regulatory risk than Allwyn's lottery business. Allwyn's strong free cash flow (FCF) generation is mitigated by high acquisitive growth (including using cash flows to increase stakes in existing businesses), shareholder-friendly financial policy and a more complex group structure. The resulting credit profiles are broadly comparable, resulting in the same rating. KEY ASSUMPTIONS Fitch's Key Assumptions Within Its Rating Case for the Issuer: - Annual revenue growth of around 1% in 2024-2025 - Synergies of around GBP85 million in 2023, growing to GBP120 million in 2024 and by GBP5 million p.a. in the following two years - EBITDAR margin of 19% in 2023 and around 21% in 2024, driven by synergies - Non-recurring expenses averaging around GBP60 million p.a. in 2023-2025 - Capex at around 4% of revenues to 2026 - No dividends in 2023-2026 RATING SENSITIVITIES Factors That Could, Individually or Collectively, Lead to Upgrade: - Evidence of EBITDAR margin being maintained above 15% following successful integration of the WHI business - Sustained low single-digit FCF margins after dividends - Evidence of adjusted net debt/EBITDAR trending lower towards 5.0x - EBITDAR fixed charge cover above 2.5x on a sustained basis Factors That Could Individually or Collectively, Lead to the Outlook Being Revised to Stable: - Increased visibility over regulation in the UK - Successful integration of the WHI business with delivery of identified synergies - Neutral to positive FCF after dividends - Visibility that management is adhering to a more conservative financial policy, with adjusted net debt/EBITDAR trending below 6.0x on a sustained basis Factors That Could, Individually or Collectively, Lead to Downgrade: - EBITDAR margin below 12% due to increased regulatory pressure or failure to effectively integrate the WHI business - Negative FCF after dividends - Adjusted net debt/EBITDAR above 6.0x on a sustained basis - EBITDAR fixed charge cover maintained below 1.8x LIQUIDITY AND DEBT STRUCTURE Solid Liquidity, Concentrated Maturities: As of 30 June 2023, 888 had solid liquidity with Fitch-calculated readily available cash of GBP88 million (excluding GBP130.3 million customer balances and GBP100 million adjustment for working-capital swings) and a fully undrawn GBP150 million revolving credit facility (RCF). At the same time, virtually all debt except for GBP11 million of legacy WHI bonds, matures in 2027-2028. Fitch expects FCF margin to turn positive from 2024, but not sufficiently for full debt repayment at maturity. Fitch therefore expects 888 will aim to refinance a majority of its outstanding debt well ahead of maturities. ISSUER PROFILE Gibraltar-based gaming operator 888 is a global online gaming and sports betting operator focused on casino and poker, with retail operations in the UK. ESG CONSIDERATIONS 888 has an ESG Relevance Score of '4' for Customer Welfare - Fair Messaging, Privacy & Data Security due to increasing regulatory scrutiny of the sector, particularly in the UK, greater awareness around social implications of gaming addiction and an increasing focus on responsible gaming. Although Fitch has factored into its rating case of its conservative assumptions on UK online sales and profitability, ahead of the UK Online Gambling Review, more punitive legislation than envisaged could put the ratings under pressure, given 888's high leverage profile. 888 has an ESG Relevance Score of '4' for Corporate Governance - Board Independence and Effectiveness, Ownership Concentration due to recent unanticipated top management rotations, and regulator's concerns over suitability of one of its minority shareholders. The highest level of ESG credit relevance is a score of '3', unless otherwise disclosed in this section. A score of '3' 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. Fitch's ESG Relevance Scores are not inputs in the rating process; they are an observation on the relevance and materiality of ESG factors in the rating decision. Entity/Debt Rating Recovery Prior ----------- ------ -------- ----- 888 Acquisitions Limited senior secured LT BB+ Affirmed RR2 BB+ 888 Holdings PLC LT IDR BB- Affirmed BB- 888 Acquisitions LLC senior secured LT BB+ Affirmed RR2 BB+ AC PLC: Set to Go Into Administration ------------------------------------- Grant Prior at Construction Enquirer reports that data centre construction specialist AC Plc has filed a notice of intention to appoint an administrator. The notice was lodged with the courts on Aug. 18, Construction Enquirer relates. Latest results for the year to March 31, 2022, show AC made a pre-tax profit of GBP946,000 from a turnover of GBP49.1 million, Construction Enquirer discloses. During the year, the company employed 193 staff, Construction Enquirer notes. Bedfordshire based AC specialises in all aspects of data centre construction across the UK and Europe including the manufacturing and installation of cladding, roofing and curtain walling. ELCOCK REISEN: Enters Administration, 32 Jobs Affected ------------------------------------------------------ Caroline Gall and Rob Trigg at BBC News report that a Shropshire coach firm operating for almost 100 years has gone into administration with all future bookings cancelled. Elcock Reisen, in Telford, made the announcement on social media and said its offices would close on Aug. 18, BBC relates. According to BBC, the firm said it was contacting customers as quickly as possible, but said there was no guarantee they would get their money back. Thirty-two staff members were expected to be affected by its closure, BBC discloses. The firm, as cited by BBC, said administration was a result of a takeover falling through after it ran in to financial difficulties due to rising prices and wages. It said it had also seen a fall in securing contracts, especially with Shropshire Council, BBC notes. Director Nick Prince said administrators would be in touch with current customers in the coming days who could also call the firm's head office before 16:00 BST today, Aug. 24, BBC discloses. Councils and other clients have also been informed, he said, notes the report. According to BBC, in a statement, Shropshire Council said it was made aware on Aug. 23 that the firm would unfortunately cease trading before the beginning of the school term in September. "Following the announcement, we will now work with other bus and coach companies to cover the [15] school transport contracts that Elcocks has been operating," it said, notes the report. "We will ensure details of the new providers are confirmed before the beginning of the new school term, to provide reassurance to pupils and parents." MONARCH AIRLINES: To Relaunch Six Years Following Collapse ---------------------------------------------------------- Rachael McMenemy at BBC News reports that Monarch Airlines is preparing to relaunch six years after collapsing. According to BBC, the company, which operated out of London Luton Airport, confirmed its new headquarters would be in the Bedfordshire town. The airline collapsed in 2017, with more than 1,800 workers made redundant and the flights and holidays for about 860,000 people being cancelled, BBC recounts. Monarch has announced that the airline and the holiday company have been transferred to new ownership, BBC discloses. According to Companies House, the new incarnation of the firm was founded in January. A new website and social media accounts have also been launched, BBC states. "On the 18th of August we completed the critical first step in our mission to relaunch a much-loved name in UK travel when Monarch Airlines and Monarch Holidays were passed into new ownership," BBC quotes a spokesperson for the company saying. "We're now building a brand new Monarch and can't wait to share more with the travelling public in the very near future." When the company ceased trading in October 2017 the Civil Aviation Authority had to help 110,000 holidaymakers return home, BBC relays. NORTH LANDS: Enters Liquidation, 6 Jobs Lost -------------------------------------------- Craig Meighan at STV News reports that six people have lost their jobs after a glass-making business in the Highlands went into liquidation. North Lands Creative Glass, based in Lybster in Caithness, was started in 1995 to "stimulate the growing interest in the possibilities of glass as an art form and provide cultural activities to the community of Caithness and across Scotland". But the firm, which has been operating at a loss for several years, said it was increasingly battling soaring costs alongside a difficulty in recruiting workers in the area, STV News relates. On Aug. 22, Blair Nimmo and Geoff Jacobs from Interpath Advisory were called in as joint liquidators, STV News discloses. "Our focus will now be on supporting the employees affected and securing and realising the business and assets of the company, which include freehold property, artwork, furnaces and other equipment," STV News quotes Mr. Jacobs, managing director at Interpath Advisory, as saying. "Clearly it would be great to see the business continue in some manner and therefore, if any party is interested in acquiring the business and/or its assets, they should contact the joint liquidators as soon as possible." WILKO LTD: Fails to Find Buyer, 12,500 Jobs at Risk --------------------------------------------------- Noor Nanji at BBC News reports that the administrators of Wilko said jobs are set to go and stores will close after it failed to find a buyer for the whole business. However, PwC said parts of the group could still be bought, BBC relates. Wilko announced earlier this month that it was going into administration, putting 12,500 jobs and its 400 stores at risk, BBC recounts. PwC was tasked with trying to look for a buyer for all or part of the business, BBC discloses. According to BBC, in a statement, PwC said: "While discussions continue with those interested in buying parts of the business, it's clear that the nature of this interest is not focused on the whole group." PwC, as cited by BBC, said it understood the news would further add to uncertainty felt by workers and said it would be supporting staff. It said that in the immediate term, all stores remain open and continue to trade, and that staff would continue to be paid, BBC notes. It also said there were "currently no plans to close any stores next week". Earlier the union representing workers at Wilko said the majority of stores are to close "within weeks" after a purchase fell through, BBC recounts. The GMB said that some stores might be bought, but "significant job losses" are now expected, according to BBC. After the collapse of Woolworths in 2008, Wilko -- which is still family run -- stepped up to fill the gaps left on High Streets, BBC relays. But it has been struggling with sharp losses and a cash shortage, BBC discloses. WORCESTER WARRIORS: To Remain in Administration as Sale Continues ----------------------------------------------------------------- Rachel Covill at TheBusinessDesk.com reports that Worcester Warriors is to remain in administration as the drawn out sale of the club to new owners Atlas continues. Worcester Warriors were sold to new owners Atlas for GBP2.05 million, according to a report released earlier this month by the club's administrators Begbies Traynor, which also confirmed that the takeover is yet to complete in full, TheBusinessDesk.com relates. According to TheBusinessDesk.com, the 38-page report into the progress being made by the administrators reported that Atlas Worcester Warriors -- co-owned by Jim O'Toole and James Sandford -- paid GBP2.05 million for the Sixways stadium and the surrounding land. But there is still a remaining GBP1 million to be paid to complete the transaction and Begbies told Atlas that the fee must be received by Oct. 9, TheBusinessDesk.com states. Begbies were appointed at Warriors following the club being placed into administration in September 2022, TheBusinessDesk.com recounts. Now, Begbies Traynor have said in a letter to creditors that the "period of administration has been extended", TheBusinessDesk.com notes. They must remain "in office" to receive the further payment and "subsequently make a distribution to the preferential creditor" who has given consent for the administration period to continue, according to TheBusinessDesk.com. The letter confirmed that investigations into Worcester's affairs was continuing and that work was needed to complete accounts for the first year of administration, which began in September 2022, to ensure that corporation tax "does not rank as an expense" of it, TheBusinessDesk.com relays. Begbies Traynor sold the club's P-share back to the Premiership for GBP9.8 million, TheBusinessDesk.com recounts. ********* 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- published by Bankruptcy Creditors' Service, Inc., Fairless Hills, Pennsylvania, USA, and Beard Group, Inc., Washington, D.C., USA. 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. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. The TCR Europe subscription rate is US$775 per half-year, delivered via e-mail. Additional e-mail subscriptions for members of the same firm for the term of the initial subscription or balance thereof are US$25 each. For subscription information, contact Peter Chapman at 215-945-7000. * * * End of Transmission * * *