/raid1/www/Hosts/bankrupt/TCREUR_Public/240429.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
Monday, April 29, 2024, Vol. 25, No. 86
Headlines
D E N M A R K
SGL GROUP: Fitch Puts Final 'B+' Rating to EUR600M Sr. Sec. Bonds
F R A N C E
BANIJAY GROUP: Fitch Affirms 'B+' LongTerm IDR, Outlook Stable
GINKGO SALES 2022: DBRS Confirms BB Rating on Class E Notes
G E R M A N Y
IRIS HOLDCO: Moody's Affirms 'B3' CFR & Alters Outlook to Negative
REVOCAR 2021-1: DBRS Confirms BB Rating on Class D Notes
G R E E C E
INTRALOT SA: DBRS Gives B Issuer Rating, Trend Stable
I R E L A N D
BAIN CAPITAL 2024-1: S&P Assigns B- (sf) Rating to Class F Notes
MADISON PARK VIII: Moody's Hikes Rating on EUR11.5MM F Notes to B2
I T A L Y
NEOPHARMED GENTILI: S&P Assigns 'B' Long-Term ICR, Outlook Stable
N E T H E R L A N D S
JUBILEE PLACE 6: DBRS Gives Prov. BB Rating to Class E Notes
JUBILEE PLACE 6: S&P Assigns BB (sf) Rating to Class X1 Notes
R U S S I A
APEX LIFE: S&P Assigns 'B+' Fin'l. Strength Rating, Outlook Stable
S P A I N
CAIXABANK CONSUMO 5: DBRS Hikes Series B Notes Rating to BB(high)
S W I T Z E R L A N D
VERISURE MIDHOLDING: S&P Affirms 'B+' ICR on Proposed Refinancing
T U R K E Y
TURKIYE SISE: Fitch Hikes LongTerm IDR to BB-, Outlook Positive
U N I T E D K I N G D O M
ATLAS: Goes Into Administration After Worcester Takeover
BELLIS FINCO: Fitch Affirms B+ LongTerm IDR, Alters Outlook to Pos.
EDDY'S FOOD: CJ Lang Acquires Three Stores Following Collapse
EVEREST 2020: Enters Administration, 350 Jobs at Risk
FLAT CAP: Administrators Put Courthouse in Knutsford Up for Sale
JOHN BARNES: Ex-Footballer Faces Director Disqualification
LONDON CARDS 2: DBRS Gives Prov. CCC Rating to Class F Notes
MOLOSSUS BTL 2024-1: Fitch Assigns B-(EXP)sf Rating to Cl. X Notes
NEPTUNE ENERGY: S&P Withdraws 'BB+' Long-Term Issuer Credit Rating
NEWDAY FUNDING 2024-1: DBRS Finalizes BB Rating on Class E Notes
SELINA HOSPITALITY: Receives NASDAQ Delisting Notice, Seeks Hearing
THAMES WATER: Ofwat Mulls Break-up Under Project Telford
[*] UK: Company Insolvencies Down 2% in First Quarter 2024
X X X X X X X X
[*] BOND PRICING: For the Week April 22 to April 26, 2024
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D E N M A R K
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SGL GROUP: Fitch Puts Final 'B+' Rating to EUR600M Sr. Sec. Bonds
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Fitch Ratings has assigned SGL Group ApS's EUR600 million senior
secured callable floating rate bonds a final senior secured rating
of 'B+'/'RR3'. Fitch has also updated the waterfall output of the
existing senior secured bonds to 55% (in line with the new bonds),
which did not have an impact on their 'B+'/RR3 ratings.
The final rating reflects the issuance and settlement of the new
bonds in line with its expectations.
KEY RATING DRIVERS
NEW SENIOR SECURED BONDS
Senior Secured Rating: The 'B+'/RR3 senior secured rating is
aligned with the rating of the existing bonds, benefiting from a
one-notch uplift from the 'B' IDR. The higher debt amount is
mitigated by the additional EBITDA contribution from the two
near-term acquisitions, resulting in a broadly similar expected
waterfall output of 55% (53% before the transaction).
Broadly Similar Terms: The new bonds will be used to refinance
roughly EUR500 million of the outstanding senior secured floating
rate bonds and fund near-term acquisitions. The main terms are
broadly aligned with those of the existing notes and the issues
rank pari passu. The new issuance should marginally improve SGL's
debt maturity profile.
SGL
Unchanged Strategy: The debt-fueled inorganic growth is aligned
with its expectations and does not represent a deviation from SGL's
strategy, in its view. The company has a solid record of acquiring
and successfully integrating smaller companies and Fitch expects
this to continue. On top of the acquisitions of close to USD200
million expected for 2024, Fitch assumes further M&A of around
USD100 million per year from 2025, using conservative valuation
multiples.
Resilient Performance in 2023: SGL's EBITDA was around USD213
million in 2023, with a limited year-on-year reduction from a very
strong 2022. Even if cash interests absorb almost half the
company's EBITDA, the limited working capital needs and asset-light
nature of the business resulted in neutral free cash flow (FCF),
better than its expectations last year, which conservatively
included a sizeable absorption from working capital.
Slower Deleveraging: Fitch expects EBITDA leverage to remain
broadly flat in 2024-2026 at 4.6x (about 4x in 2023), slightly
higher than its previous forecasts, as Fitch expects EBITDA and
debt to gradually increase as a result of external growth. Fitch
conservatively assumes a reduction of like-for-like EBITDA
(excluding acquisitions), due to easing of transportation and
logistical constraints and general macroeconomic uncertainty. This
normalisation will be despite the short-term positive rate
developments related to route disruptions introduced by the attacks
on the Red Sea.
Lower Funding Costs: The new bond issue reduces SGL's funding
costs. Fitch forecasts EBITDA interest coverage to average 2.7x in
2024-2026, remaining within the rating sensitivities.
Red Sea Route Disruptions: Fitch does not expect the recent ocean
freight rates spike to be sustainable over the medium term. Despite
the significant disruption introduced by the attacks in the Red
Sea, Fitch believes there is more than sufficient capacity in the
industry to accommodate longer routes, as signaled by some of the
large carriers. Consequently, Fitch is not factoring in a higher
rates scenario in its forecasts, although Fitch acknowledges there
is some upside potential in the short term due to rate volatility.
Niche Operator: SGL is a small but fast-growing company in the
freight-forwarding market. It operates in all main modes of
transport. It focuses on forwarding complex transportation projects
and non-standardised goods in sectors including aid & relief, food
ingredients and additives, fashion and retail, specialty
automotive, and more recently, sovereign defence, with a focus on
quality of service rather than price. Its strategy reduces direct
competition with larger peers, but SGL remains exposed to the
highly competitive nature of the freight-forwarding sector.
Portfolio Diversification: Together with diversified logistics
solutions (by mode of transport and geography), SGL serves more
than 25,000 customers, with the 10 largest having an average tenure
of around nine years and no client accounting for more than 3% of
gross profit. In addition, SGL provides forwarding services to
non-governmental organisations through its ADP division, which
tends to be less cyclical than commercial segments.
Asset-light Balance Sheet: SGL's business model is asset-light and
capex needs are limited, which protect cash flows in case of large
declines in sales volumes. Its cost structure is rather flexible
with a high share of variable costs (mainly purchases of freight
capacity, which is effectively passed through to customers). Fitch
views freight forwarding as less volatile than shipping with some
margin resilience against economic downturns.
KEY ASSUMPTIONS
Fitch's Key Assumptions Within Its Rating Case for the Issuer:
- Gross profit increasing towards USD925 million by 2027, mostly
through acquisitions but supported by modest organic growth
- EBITDA gradually rising to almost USD250 million by 2027
- Acquisitions of around USD200 million in 2024, funded through new
debt
- Effective interest rate hovering around 8% over the forecast
horizon
- Modestly negative working capital as the impact from falling
rates is offset by increased volumes
- Capex averaging around USD24 million per year to 2027
- Yearly acquisitions of around USD100 million from 2025 at
enterprise value (EV)/EBITDA multiples around 5-6x
- No dividend distributions or equity injections
RECOVERY ANALYSIS
Fitch's going concern (GC) EBITDA of USD155 million assumes a sharp
downturn in the transportation industry. The assumed GC EBITDA
takes SGL's 2023 EBITDA as reference and also includes around USD22
million EBITDA contributions from acquisitions to be funded by the
new bonds. Fitch then applies a conservative 25% cut, reflecting
the issuer's exposure to the economic cycle and consequent trading
underperformance, with an increased debt burden. This haircut is
proportionately smaller than the previous haircut due to a more
normalised freight rate scenario.
Fitch applies a distressed enterprise value (EV)/EBITDA multiple of
5x to calculate a GC EV, which is in line with the median for 'B'
companies in the sector. This results in a GC EV of USD695 million,
after deducting administrative claims.
Considering the presence of super-senior debt including the DKK750
million super senior revolving credit facility and USD75 million
asset-backed loan facility totaling USD186 million, the expected
waterfall analysis output percentage on current metrics and
assumptions was 55%, which is commensurate with 'RR3', providing a
one notch uplift to the senior secured rating from the IDR.
RATING SENSITIVITIES
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade:
- Successful implementation of the growth strategy, resulting in
EBITDA leverage consistently below 4.5x
- EBITDA interest coverage consistently above 2.8x
- Consistently positive FCF generation
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade:
- EBITDA leverage consistently above 5.5x
- EBITDA interest coverage consistently below 2.3x
- Negative FCF through the economic cycle
LIQUIDITY AND DEBT STRUCTURE
SGL's liquidity reached around USD150 million end-2023, further
supported by the DKK750 million revolving credit facility and USD75
million asset-backed loan, both committed until 2027 and currently
undrawn. The company has no financing needs in the medium term,
despite negative FCF after acquisitions under Fitch's rating case.
SGL is exposed to refinancing risk only in 2028 when the
floating-rate notes mature.
ISSUER PROFILE
SGL is an asset-light freight forwarder and logistics provider with
a global footprint, particularly active in the Nordics, North
America and APAC.
ESG CONSIDERATIONS
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
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SGL Group ApS
senior secured LT B+ New Rating RR3 B+(EXP)
senior secured LT B+ Affirmed RR3 B+
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F R A N C E
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BANIJAY GROUP: Fitch Affirms 'B+' LongTerm IDR, Outlook Stable
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Fitch Ratings has affirmed Banijay Group SAS's Long-Term Issuer
Default Rating (IDR) at 'B+' with a Stable Outlook. Fitch has also
affirmed the company's senior secured notes at 'BB-'/'RR3' and
senior unsecured notes at 'B-'/'RR6'.
Banijay's 'B+' IDR reflects its analytical approach for a stronger
parent (FL Entertainment N.V.; FLE) and weaker subsidiary (Banijay)
where Fitch applies a bottom-up assessment with a single notch
uplift from Banijay's Standalone Credit Profile (SCP) of 'b'.
Banijay's ratings reflect its strong market position and higher
revenue and cash-flow visibility due to a high proportion of
short-term unscripted content production, which supports robust
operating cash flow. The rating is constrained by high leverage and
low coverage metrics.
The Stable Outlook reflects Fitch's view that Banijay's credit
metrics will remain consistent with a 'b' SCP in 2024-2026.
Interest cover metrics will be pressured by high interest costs,
but the maturity extension of the capital structure helps underpin
the company's financial flexibility.
KEY RATING DRIVERS
Robust Business Model: Banijay's 'b' SCP reflects a robust business
model with increasing scale and revenue stream diversification.
Fitch expects low single digit pro-forma revenue growth and a
Fitch-defined EBITDA margin around 11.5%, which reflects stable
overall demand for unscripted content and a higher contribution
from scripted production (to reach 27% of production and
distribution revenue in 2024). Fitch forecasts that earnings and
pre-dividend free cash flow (FCF) will remain resilient through the
economic cycle.
Leverage Aligned with 'b' SCP: A sound business risk profile is
balanced by leverage (gross and net) and interest cover metrics in
the 'b' category. Leverage rose to 5.6x in 2023 (5.2x in 2022) but
Fitch expects it to remain at around 5.6x, or decline slightly,
depending on opportunistic M&A and payment of earn-outs. The
Fitch-defined EBITDA margin fell to 12.1% in 2023 from 12.7%,
driven by flat production revenue growth but also reflecting the
contribution from Balich Wonder Studios, offset by outflows from
higher cash long-term incentive plan payments and higher cash
interest.
Maturities Extended, Weak Interest Cover: Refinancing of the bulk
of Banijay's debt during 2023 helped extend senior debt maturities
thus maintaining a manageable refinancing risk. However, EBITDA
interest cover fell to 2.3x in 2023 (3.5x in 2022) driven by higher
interest rates incurred, although Banijay managed to secure a rate
re-pricing in February 2024, potentially saving around EUR6 million
per year. Hedging arrangements should keep cash interest costs and
interest cover stable at around 2.4x over the next four years,
albeit weak for the rating.
Stable Operating Cash Flows, Dividends: Fitch believes Banijay's
stable EBITDA margin and low working capital outflows and capex
requirements should help absorb higher interest payments over the
short term. Banijay paid a EUR54.8 million dividend in 2023 and
Fitch expects a similar level of payments on a run-rate basis
resulting in Fitch-defined FCF margin after dividends averaging
0.5%. Fitch believes the company has some flexibility to reduce
dividends if needed, as FLE itself has no debt. However, there
could be rating pressure if FCF turns negative combined with weaker
interest cover.
Acquisitive Strategy: Banijay completed several acquisitions and
investments during 2023 spending EUR140 million including
earn-outs, reflecting its appetite to build scale, increase
scripted content and diversify into allied media segments. The
largest acquisition was for a majority stake in live entertainment
and events business, Balich, in September, which Fitch estimates
contributed around EUR240 million and EU30 million in revenue and
EBITDA, respectively, on an annualised pro-forma basis. Balich
performed weaker than Fitch expected when the deal closed due to
seasonality and postponements.
Banijay expects some revenue synergies from Balich, leveraging its
production and distribution expertise. However, visibility of
revenue and profitability is lower in this segment, with higher
seasonality and lower recurring revenues. Fitch expects Banijay to
remain opportunistic across all media verticals but with greater
focus on the acquisition of talent and intellectual property.
Underlying Secular OTT Growth: Banijay is well-positioned to grow
with streamers and digital platforms at broadcasters in the
over-the-top (OTT) niche, which currently represents around 19% of
its production and distribution revenues (from 13% in 2021). Its
focus on strong local content should benefit from demand from
streamers facing jurisdictional local content regulation in Europe.
This is supplemented by Banijay's cost-efficient non-scripted
content in times of weaker consumer purchasing power and
broadcasters' cost-cutting.
Continued global TV market growth will be driven by OTT growth at
streaming platforms, but also via digital platforms developed by
traditional broadcasters. Fitch expects extraordinary content spend
in 2020-2022, predominantly by streamers, to slow to around
compound annual growth of 2% 2023-27, due to fewer large budget
productions and economic pressure on consumer spend and
advertising.
PSL Approach: In applying its Parent-Subsidiary Linkage (PSL)
Criteria, Fitch assesses the legal and operational incentives for
FLE to support Banijay as 'Low' with no operational overlap between
the parent and subsidiary. There are no cross defaults or
guarantees between FLE and Banijay. Fitch views strategic
incentives to support as 'Medium', as Banijay represents around
two-thirds of FLE's consolidated EBITDA. This assessment leads to
an overall bottom-up approach where Banijay's 'B+' IDR is lifted
one notch above its 'b' SCP.
Stronger Parent/Weaker Subsidiary: Fitch views the consolidated
business profile of FLE as broadly corresponding at least to the
low 'bb' range. FLE's larger scale and business diversification is
partly constrained by material regulatory oversight in the online
gaming subsidiary, Betclic. However, the consolidated profile
benefits from a stronger financial structure and financial
flexibility, with estimated Fitch-defined EBITDA net leverage of
around 4.1x in 2023. In its view, deleveraging is sensitive to
FLE's dividend policy. FLE's financial policy is to be at below
3.0x group-defined net debt/EBITDA (3.1x at end-2023) in the medium
term.
DERIVATION SUMMARY
Banijay is the largest independent TV production firm globally. Its
peers include Lions Gate Entertainment Corp. (B-/Stable) and
All3Media as well as integrated media businesses ITV Studios, part
of ITV plc (BBB-/Stable) and Fremantle Limited (part of RTL
Group).
Banijay benefits from geographic diversification and tailored local
content with a greater proportion of non-scripted content than its
peers, supporting lower operating volatility and stable cashflows.
The company has increased its scripted content towards 25% of
production and distribution revenue (public guidance to remain
around 25%). Its scale is commensurate with Lions Gate, a content
and streaming business, although Lions Gate has higher hit-driven
volatility from its film business and higher leverage. ITV has
weaker geographic diversification, it benefits from a strong market
position in a highly developed media market, as a public service
broadcaster and major advertiser. It also maintains stronger
financial flexibility and significantly lower leverage.
Fitch covers several other peers in the diversified media industry
such as Warner Bros. Discovery, Inc. (BBB-/Stable), Paramount
Global (BBB-/Negative), The Walt Disney Company (A-/Stable) and
Comcast Corp. (A-/Stable). These are much larger, more diversified
and have stronger competitive positions in the value chain than
Banijay, allowing for higher leverage thresholds at any given
rating.
Fitch views Banijay's business profile as stronger than
Spanish-based sports and media entertainment group Subcalidora 1
S.a.r.l. (Mediapro, B/Stable), owing to the latter's lower scale,
weaker FCF and high dependence on key accounts. Mediapro has lower
leverage than Banijay for the same SCP.
KEY ASSUMPTIONS
Key Assumptions In Its Rating Case for the Issuer:
- Revenue growth of 10% in 2024 (3% pro-forma Balich), followed by
around 2% in 2025-2027;
- Fitch-defined EBITDA margin around11.5% in 2024-2027 (Fitch
adjusts for leases and around EUR36 million of recurring outflows
related to staff incentive programmes and restructuring costs);
- Working-capital outflows below 1% of revenue in 2024-2027;
- Capex at around 2% of revenue 2024-2027;
- Common dividends of around EUR60 million per year from 2024;
- No further M&A is assumed due to lack of visibility.
RECOVERY ANALYSIS
Fitch assumes Banijay would be reorganised as a going concern in
distress or bankruptcy rather than liquidated.
Post-restructuring EBITDA estimated at EUR337 million (including
acquired EBITDA), in the event of weaker demand for non-scripted
formats and increasing price pressure from both broadcasters and
streaming platforms. A distressed enterprise value multiple of 5.5x
to calculate a post-restructuring valuation.
Fitch deducts 10% for administrative claims and allocates the
residual value according to the liability waterfall. Fitch first
deducts EUR148 million of value derived from EUR170 million of
factoring, after applying a haircut, and EUR135 million of local
facilities ranking prior to Banijay's senior secured debt. Fitch
expects its EUR170 million revolving credit facility (RCF) to be
fully drawn in a default, ranking equally with its senior secured
term loans and senior secured notes. Thereafter, Fitch deducts its
lowest-ranking EUR400 million senior unsecured notes.
Based on current metrics and assumptions, the waterfall analysis
generates a ranked recovery at 66% in the 'RR3' band for the senior
secured loans and notes, and 0% in 'RR6' for the senior unsecured
notes. These indicate a 'BB-' senior secured instrument rating for
the senior secured term loans and notes, and a 'B-' unsecured
instrument rating for the EUR400 million notes.
RATING SENSITIVITIES
Factors That Could, Individually Or Collectively, Lead To Positive
Rating Action/Upgrade
- EBITDA net leverage below 4.8x on a sustained basis, together
with visibility of the use of high cash balances (and less
divergence between gross and net leverage metrics), will be a key
consideration for an upgrade;
- Continued growth of EBITDA and FCF, with continued demand for
non-scripted and scripted content without significant increase in
competitive pressure;
- Stronger legal, strategic or operational incentives for
consolidated FLE to support Banijay's credit profile;
- EBITDA interest cover sustained above 3.3x.
Factors That Could, Individually Or Collectively, Lead To Negative
Rating Action/Downgrade
- Total EBITDA net leverage above 5.8x (or greater divergence
between gross and net leverage metrics) on a sustained basis;
- EBITDA interest coverage sustained below 2.8x;
- Deterioration of EBITDA because of failure to renew leading
shows, increase in competition or inability to control costs;
- Weaker linkages between FLE and Banijay, with reduced incentives
to support Banijay's SCP;
- An overall weaker consolidated credit profile of FLE, so that the
parent's consolidated credit profile is no longer stronger than
Banijay's SCP.
LIQUIDITY AND DEBT STRUCTURE
Satisfactory Liquidity: Banijay's cash equivalent was EUR369
million at end-2023. In addition, Banijay has access to a EUR170
million undrawn RCF. Fitch forecasts mildly positive FCF
post-dividends in 2024-2027, which combined with its cash position,
provides satisfactory liquidity for working-capital requirements,
earn-outs and growth M&A opportunities.
Manageable Refinancing Risks: The extended and upsized senior
secured term loans now mature in March 2028 while the senior
secured notes mature in May 2029. The unsecured EUR400 million
notes mature March 2026. Fitch expects refinancing to be
manageable, based on the leverage profile, FCF and interest cover
remaining at the 'b' level, adjusted for a higher interest-rate
environment.
ISSUER PROFILE
Banijay is the largest independent content producer and distributor
globally; home to over 130 production companies across 23
territories, and a multi-genre catalogue boasting over 185,000
hours of original standout programming.
ESG CONSIDERATIONS
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
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Banijay Entertainment
SAS
senior secured LT BB- Affirmed RR3 BB-
Banijay Group SAS LT IDR B+ Affirmed B+
senior unsecured LT B- Affirmed RR6 B-
Banijay Group US
Holding, Inc.
senior secured LT BB- Affirmed RR3 BB-
GINKGO SALES 2022: DBRS Confirms BB Rating on Class E Notes
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DBRS Ratings GmbH upgraded and confirmed its credit ratings on the
bonds issued by Ginkgo Sales Finance 2022 (the Issuer), as
follows:
-- Class A Notes confirmed at AAA (sf)
-- Class B Notes confirmed at AA (sf)
-- Class C Notes upgraded to A (high) (sf) from A (sf)
-- Class D Notes upgraded to BBB (high) (sf) from BBB (sf)
-- Class E Notes confirmed at BB (sf)
-- Class F Notes upgraded to B (sf) from B (low) (sf)
The credit ratings of the Class A and Class B Notes address the
timely payment of scheduled interest and the ultimate repayment of
principal by the legal final maturity date in November 2049. The
credit ratings of the Class C, Class D, Class E, and Class F Notes
address the ultimate payment of scheduled interest while the class
is subordinated and the timely payment of scheduled interest while
the senior-most class outstanding, and the ultimate repayment of
principal by the legal final maturity date.
The credit rating actions follow an annual review of the
transaction and are based on the following analytical
considerations:
-- Portfolio performance, in terms of delinquencies, defaults, and
losses as of the February 2024 payment date.
-- Probability of default (PD), loss given default (LGD), and
expected loss assumptions on the remaining receivables, and
-- Current available credit enhancement to the notes to cover the
expected losses at their respective credit rating levels.
The transaction is a securitization of fixed-rate, unsecured,
amortizing consumer loans granted to individuals domiciled in
France for the purchase of home equipment and recreational
vehicles, and the transaction is serviced by Credit Agricole
Consumer Finance SA (CACF).
PORTFOLIO PERFORMANCE
As of February 2024, loans two to three months in arrears
represented 0.3% of the outstanding portfolio balance, stable since
the last annual review one year ago. The 90-plus-day delinquency
ratio was 0.8%, slightly up from 0.6%, and the cumulative default
ratio increased to 0.8% from 0.2% in the same period.
PORTFOLIO ASSUMPTIONS AND KEY DRIVERS
Morningstar DBRS conducted a loan-by-loan analysis of the remaining
pool of receivables and maintained its base-case PD and LGD
assumptions at the B (low) (sf) credit rating level at 4.8% and
58.3%, respectively, based on the current portfolio composition.
CREDIT ENHANCEMENT
The credit enhancement to the rated notes consists of the
subordination of their respective junior class of notes. As of the
February 2024 payment date, credit enhancement to the Class A,
Class B, Class C, Class D, Class E, and Class F notes were 24.6%,
17.8%, 12.1%, 7.5%, 4.8%, and 3.7%, respectively, up from 18.8%,
13.6%, 9.2%, 5.6%, 3.6%, and 2.7%, respectively, one year ago.
The transaction includes Class A and Class B liquidity reserve
funds that are available to the Issuer in restricted scenarios
where the interest and principal collections are not sufficient to
cover the shortfalls in senior expenses, swap payments, and
interests on the Class A Notes (available from both the Class A and
Class B liquidity reserves) and the Class B Notes (only available
from the Class B liquidity reserve). The Class A and Class B
liquidity reserve funds were both at their target levels of EUR 2.7
million and EUR 5.6 million, respectively, as of the February 2024
payment date.
CACF acts as the account bank for the transaction. Based on
Morningstar DBRS' private credit rating on CACF, the downgrade
provisions outlined in the transaction documents, and other
mitigating factors inherent in the transaction structure,
Morningstar DBRS considers the risk arising from the exposure to
the account bank to be consistent with the AAA (sf) credit rating
on the Class A Notes, as described in Morningstar DBRS' "Legal
Criteria for European Structured Finance Transactions"
methodology.
CACF acts also as the swap counterparty for the transaction.
Morningstar DBRS' private credit rating on CACF is consistent with
the first rating threshold as described in Morningstar DBRS'
"Derivative Criteria for European Structured Finance Transactions"
methodology.
Morningstar DBRS' credit ratings on the notes address the credit
risk associated with the identified financial obligations in
accordance with the relevant transaction documents.
Morningstar DBRS' credit ratings do not address nonpayment risk
associated with contractual payment obligations contemplated in the
applicable transactions documents that are not financial
obligations.
Morningstar DBRS' long-term credit ratings provide opinions on risk
of default. Morningstar DBRS considers risk of defaults to be the
risk that an issuer will fail to satisfy the financial obligations
in accordance with the term under which a long-term obligation has
been issued.
Notes: All figures are in euros unless otherwise noted.
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G E R M A N Y
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IRIS HOLDCO: Moody's Affirms 'B3' CFR & Alters Outlook to Negative
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Moody's Ratings has affirmed the B3 long-term corporate family
rating and the B3-PD probability of default rating of Iris HoldCo
GmbH (Rodenstock), the parent company of German-based producer and
distributor of ophthalmic lenses Rodenstock. Concurrently, Moody's
has affirmed the B3 rating of the EUR810 million backed senior
secured term-loan B (TLB) maturing in 2028 and the EUR125 million
backed senior secured revolving credit facility (RCF) maturing in
2027, borrowed by Rodenstock Group GmbH. The outlook on both
entities has been changed to negative from stable.
"The outlook change to negative reflects Rodenstock's very high
leverage and weak interest coverage metrics for the B3 rating
category, owing to the weaker than expected performance in 2023,
especially due to a larger impact of the GrandVision phase-out,"
says Michel Bove, a Moody's AVP-Analyst and lead analyst for
Rodenstock.
"While the affirmation of Rodenstock's ratings reflects Moody's
expectation of progressive improvements in its earnings, leverage
and free cash flow generation over the next 2 years, there is no
headroom for deviation in terms of operating performance relative
to Moody's expectations," adds Mr. Bove.
RATINGS RATIONALE
The outlook change to negative from stable reflects Moody's view
that the company's credit metrics will remain weaker than
previously expected at least over the next 2 years. Despite
anticipation of a turnaround in 2023, overall revenue growth was
limited to mid-single digit growth largely due to significant
impact of the GrandVision phase out. This impact overshadowed the
company's sales performance in lenses which was supported by
relatively solid volume growth and, to a lesser extent, pricing.
Despite implementing and realizing cost-efficiency measures in
2023, the company's Moody's-Adjusted EBITDA margin deteriorated
slightly, as cost savings were offset by other cost items such as
increased wages. The company's Free Cash Flow (FCF), before pension
payments, remained positive but marginal at EUR2 million.
Consequently, the company's Moody's-adjusted gross leverage
remained stable at 10.7x, a very high level for the current B3
rating, weakly positioning the rating. Additionally, EBIT coverage
of interest expense was very low at 0.4x.
Moody's now anticipates that Rodenstock's revenue will grow by
mid-single digits in the next 12-18 months. This forecast factors
in the phase-out of GrandVision in 2024, which will reduce
revenues, partially offset by growth in other key accounts and
independent opticians. Additionally, challenging consumer sentiment
will result in lower organic growth in the lenses segment, further
compounded by pricing power headwinds.
The agency's forecasts a gradual improvement in Moody's-adjusted
EBITDA margin: cost-efficiency measures, such as the relocation and
centralisation of its production to low-cost countries will drive
this improvement, which will be partially offset by inflationary
effects in the cost structure. However, these efficiency measures
come, as usual, with a degree of execution risk. Should these risks
materialize, they could slow down the recovery of the company's
credit metrics. Finally, Moody's forecasts that FCF, before pension
payments, will remain positive in 2024 at around EUR25 million.
While Moody's anticipates a gradual improvement in the company's
credit metrics, the negative outlook indicates limited room for
deviation, given the company's weak position in the B3 rating
category due to its high leverage.
Rodenstock's rating continues to factor in (1) its established
market position as the world's fourth-largest ophthalmic lens
producer and its strong position in core European markets; (2) its
comprehensive offering in both branded and private-label corrective
lenses with a focus on high-end progressive biometric lenses,
complemented by the sale of equipment and services for opticians;
(3) favourable fundamental demand drivers for lenses, supported by
the increasing average age of lens wearers in the main European
markets and growing population in emerging markets; (4)
expectations of gradual operational improvement in the next 12-18
months, aided by cost-saving initiatives resulting in positive FCF;
and (5) the company's still adequate, albeit weakening, liquidity.
Concurrently, Rodenstock's ratings continues to be constrained by
(1) the company's very high leverage and weak interest coverage
metrics; (2) its smaller size than that of its direct peers; (3)
the risk that further consolidation of distribution channels and
the emergence of discounters might strain margins over time; (4)
its weaker than expected operating performance owing to the phase
out of the GrandVision contract; and (5) its aggressive financial
policy.
LIQUIDITY
Rodenstock's liquidity remains adequate, albeit it has weakened.
Despite the reduction of available cash to EUR38 million as of
December 2023, the EUR78 million availability under its EUR125
million RCF and long-dated maturity profile of its Term Loan B due
in 2028 supports the company's liquidity. Moody's expects the
liquidity sources to be sufficient to cover the company's needs
over the next 18 months, including seasonal working capital needs
during the first half of 2024 (although Moody's expect that the
company will need to temporarily further draw its RCF for these);
ordinary capital spending of about EUR30 million; and obligations
to service pension liabilities of EUR12 million per year.
The RCF has a maximum net leverage springing covenant of 9.5x, to
be tested only if the RCF is drawn by at least 40%. Moody's expect
Rodenstock to have ample capacity under this covenant.
STRUCTURAL CONSIDERATIONS
The B3 rating on the EUR810 million Term Loan B (including the
add-on for the Indo Optical acquisition) and the EUR125 million RCF
borrowed by Rodenstock Group GmbH are at the same level as the
group's CFR and indicate that the senior secured facilities
represent most of the group's liabilities and rank pari passu among
themselves. The facilities are secured only by pledges on shares,
bank accounts and intercompany receivables of material subsidiaries
and guarantees by group companies representing a minimum of 80% of
the group's EBITDA.
Moody's has assumed a 50% family recovery rate, as it is standard
for capital structures that include bank debt with a springing
covenant only.
RATIONALE FOR NEGATIVE OUTLOOK
The negative outlook indicates a possible downgrade over this
period if Rodenstock performs below Moody's expectations, fails to
strengthen its credit metrics in 2024 or its liquidity weakens.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
An upgrade is unlikely over the next 12-18 months given the
negative outlook. While ratings remain constrained by the very high
leverage, the ratings could be upgraded if Rodenstock's
Moody's-adjusted gross debt/EBITDA falls towards 6.0x on a
sustained basis and the company demonstrates a continued track
record of sustained profit growth and positive FCF, while
maintaining solid liquidity.
The ratings could be downgraded if the company's operating
performance does not improve in line with expectations, its
Moody's-adjusted gross debt/EBITDA remains above 7.5x on a
sustained basis, FCF turns negative for a prolonged period and
liquidity deteriorates, including a potential reduction in the
capacity under financial covenants.
PRINCIPAL METHODOLOGY
The principal methodology used in these ratings was Consumer
Durables published in September 2021.
COMPANY PROFILE
Iris HoldCo GmbH (Rodenstock) is the parent company of Rodenstock,
an ophthalmic lens producer focusing primarily on the progressive
lenses segment. It has leading positions in its domestic German
market and other Western European markets, and a growing
international presence in emerging markets, mainly in Latin
America. In 2023, Rodenstock generated sales of EUR506 million and
company-reported EBITDA before one-off items of EUR122 million.
Since 2021, the company is controlled by private equity sponsor
Apax Partners.
REVOCAR 2021-1: DBRS Confirms BB Rating on Class D Notes
--------------------------------------------------------
DBRS Ratings GmbH confirmed its credit ratings on the notes (the
rated notes) issued by RevoCar 2021-1 UG (haftungsbeschrankt) (the
Issuer) as follows:
-- Class A Notes at AAA (sf)
-- Class B Notes at A (sf)
-- Class C Notes at BBB (sf)
-- Class D Notes at BB (sf)
The credit rating on the Class A Notes addresses the timely payment
of interest and the ultimate payment of principal on or before the
legal final maturity date in May 2038. The credit rating on the
Class B Notes addresses the timely payment of interest while the
senior-most class outstanding, otherwise the ultimate payment of
interest and principal on or before the legal final maturity date;
the credit ratings on the Class C and Class D Notes address the
ultimate payment of interest and principal on or before the legal
final maturity date.
CREDIT RATING RATIONALE
The confirmations follow an annual review of the transaction and
are based on the following analytical considerations:
-- Portfolio performance, in terms of delinquencies, defaults, and
losses, as of the March 2024 payment date;
-- Updated probability of default (PD), loss given default (LGD),
and expected loss assumptions for the aggregate collateral pool;
-- Current available credit enhancement to the rated notes to
cover the expected losses at their respective credit rating levels;
and
-- No revolving period termination event have occurred to date.
The transaction is a securitization of German auto loan receivables
originated and serviced by Bank11 fur Privatkunden und Handel GmbH
(Bank11) and granted primarily to private clients for the purchase
of both new and used vehicles. The transaction closed in May 2021
with an initial portfolio of EUR 700.0 million and includes a
48-month revolving period, scheduled to end on the May 2025 payment
date.
PORTFOLIO PERFORMANCE
As of the March 2024 payment date, loans that were one to two
months and two to three months in arrears represented 0.3% and 0.1%
of the outstanding portfolio balance, respectively, while loans
that were more than three months in arrears represented 0.4%. Gross
cumulative defaults amounted to 0.5% of the aggregate initial
collateral balance, with cumulative recoveries of 46.2% to date.
PORTFOLIO ASSUMPTIONS AND KEY DRIVERS
Morningstar DBRS received updated historical vintage data from the
originator and conducted a loan-by-loan analysis of the remaining
pool of receivables. Morningstar DBRS updated its base case PD and
LGD assumptions to 1.9% and 54.8%, respectively. Due to the
revolving period, Morningstar DBRS' assumptions continue to be
based on the potential portfolio migration and the replenishment
criteria set forth in the transaction legal documents.
CREDIT ENHANCEMENT
The subordination of the respective junior obligations provides
credit enhancement to the rated notes.
As of the March 2024 payment date, credit enhancement to the rated
notes remained unchanged at 8.2% for the Class A Notes, 3.5% for
the Class B Notes, 2.3% for the Class C Notes, and 1.3% for the
Class D Notes since closing due to the revolving period.
The transaction benefits from a liquidity reserve, which will only
become available upon a servicer termination event, with a target
balance equal to 0.25% of the outstanding collateral balance. The
reserve would be available to cover senior fees and expenses, and
interest payments on the Class A Notes only. As of the March 2024
payment date, the reserve was at its target balance of EUR 1.75
million.
Additionally, the transaction benefits from a commingling reserve
funded by Bank11 at closing to EUR 1.65 million. The reserve is
maintained at a balance equal to 15.0% of the scheduled collections
amount for the next collection period minus the commingling reserve
reduction amount. As of the March 2024 payment date, the reserve
was at its target balance of EUR 2.64 million.
The Bank of New York Mellon - Frankfurt Branch (BNYM-Frankfurt)
acts as the account bank for the transaction. Based on Morningstar
DBRS' private rating on BNYM-Frankfurt, the downgrade provisions
outlined in the transaction documents, and structural mitigants
inherent in the transaction structure, Morningstar DBRS considers
the risk arising from the exposure to the account bank to be
consistent with the credit ratings assigned to the notes, as
described in Morningstar DBRS' "Legal Criteria for European
Structured Finance Transactions" methodology.
Morningstar DBRS' credit ratings on the rated notes address the
credit risk associated with the identified financial obligations in
accordance with the relevant transaction documents.
Morningstar DBRS' credit ratings do not address nonpayment risk
associated with contractual payment obligations contemplated in the
applicable transaction documents that are not financial
obligations.
Morningstar DBRS' long-term credit ratings provide opinions on risk
of default. Morningstar DBRS considers risk of default to be the
risk that an issuer will fail to satisfy the financial obligations
in accordance with the terms under which a long-term obligation has
been issued.
Notes: All figures are in euros unless otherwise noted.
===========
G R E E C E
===========
INTRALOT SA: DBRS Gives B Issuer Rating, Trend Stable
-----------------------------------------------------
DBRS Ratings GmbH assigned an Issuer Rating of B to Intralot S.A.
with a Stable Trend. Incorporated in Greece, Intralot S.A. is the
parent company of the Intralot Group (the Group). The Group has
about 50 active contracts in which it supports the operations of
licensed gaming and lottery organizations, through the provision of
integrated gaming systems and services supported by its proprietary
technology solutions and management services.
KEY CREDIT RATING CONSIDERATIONS
The assigned credit rating reflects the Group's credit strengths,
which include (i) over 30 years of operating experience in a
regulated industry benefitting from high barriers to entry; (ii) a
proven ability to win long-term contracts from incumbent market
players and retain clients; (iii) a suite of proprietary technology
solutions, supported by 191 patents; and (iv) an increasing
proportion of revenue and earnings in developed markets from a
largely institutional client base. Conversely, the analysis also
considers certain rating constraints, including (i) the Group's
relatively small size in comparison to larger market players and
the concentration risk arising from a limited number of contracts;
(ii) a long sales cycle indicative of the industry, requiring
upfront investment to support growth; (iii) potential execution
risk and timing uncertainties resulting from the Group' growth
strategy; and (iv) foreign exchange risk exposure due to the
Group's global operations without a formal hedging policy,
particularly in respect to its 50.01% stake in its partnership
subsidiaries in Turkey and Argentina.
The Group has recently completed a significant refinancing and
financial restructuring exercise, which included a partial debt
prepayment following a EUR 135 million share capital increase
completed in November 2023. Subsequent to the application of these
proceeds, the Group's credit metrics as at December 31, 2023
(F2023) strengthened from historical levels with adjusted
cash-flow-to-debt of 19%, debt-to-proportionate EBITDA of 4.1 times
(x), and proportionate EBITDA-to-interest of 2.7x (proportionate
EBITDA equals Morningstar DBRS-adjusted EBITDA net of EBITDA
attributable to noncontrolling interests of non-wholly owned
subsidiaries). The Stable trend reflects Morningstar DBRS'
expectation that the Group's key credit metrics will remain within
a range supportive of the rating assignment.
The assigned credit rating also considers the material secured
indebtedness of the Group's U.S. operating subsidiary group (the
U.S. subgroup) which accounted for about 49% of the Group's F2023
consolidated EBITDA and around 45% of its consolidated financial
debt. Morningstar DBRS assesses that the current and future debt
obligations of Intralot S.A. are structurally subordinate to the
debt of the U.S. subgroup because of the stand-alone nature of the
U.S. facilities and the absence of an upstream guarantee from the
U.S. subgroup to Intralot S.A. Further, it is noted that while a
limited flow of dividends is permitted from the U.S. subgroup,
subject to certain covenant requirements, Morningstar DBRS expects
the majority of cash flow from U.S. operations to be maintained in
the U.S. subgroup to service debt obligations and fund growth
capex, which may place a degree of pressure on the cash flow
available to service to debt obligations of Intralot S.A.
CREDIT RATING DRIVERS
Morningstar DBRS may consider a positive rating action if, all else
being equal, there is sustainable improvement in the Group's
business profile such as a noted reduction in its contract/customer
concentration risk, along with continued expansion of profitability
margins and ongoing debt repayments, which support improvement of
key financial metrics from current levels, including
debt-to-proportionate EBITDA of less than 4x on a sustainable
basis. Morningstar DBRS may consider a negative rating action if,
all else being equal, the Group's credit metrics deteriorate below
the forecast assumptions, such as adjusted cash flow-to-debt
trending below 10% and/or debt-to-proportionate EBITDA trending
above 5x. Morningstar DBRS may also consider a negative rating
action should the Group take on incremental debt and/or should
there be negative events affecting the Intralot Group's business
risk profile such as the loss of a major customer contract or other
adverse business developments.
EARNINGS OUTLOOK
The Morningstar DBRS forecast assumes that the Group will maintain
its steady track record of renewing its expiring contracts, though
provides limited benefit to new business wins due to the lead time
involved in the onboarding process. The forecast also considers a
number of contract renewal dates in F2024 as well as the Group's
targeted focus on higher margin contracts. Morningstar DBRS expects
a revenue contraction in F2024 by a low-single-digit percentage,
followed by low-single-digit growth in F2025, with revenue
(including rental income) trending towards EUR 390 million by F2025
(F2023: EUR 385 million). Notwithstanding, Morningstar DBRS
forecasts that the Group will benefit from increased consolidated
EBITDA margins, which will trend toward 33% in the forecast period
(as compared with circa 31% in F2023), which will support modest
year-over-year growth in consolidated EBITDA. The forecast
estimates that the portion of EBITDA attributable to noncontrolling
interests will increase to about 15% of consolidated EBITDA (F2023:
approximately 11%) due to anticipated growth in the Turkish
non-wholly owned subsidiary, while reported growth in Argentina
will be limited by the unfavorable foreign exchange conversion.
FINANCIAL OUTLOOK
Morningstar DBRS expects the Group's cash flow from operations (net
of dividends paid to noncontrolling interests) to trend down due to
increased distributions to noncontrolling interests of its Turkish
subsidiary, offset by some positive impact from lower overall
borrowing costs due to its lower debt balances following the share
capital increase. Morningstar DBRS expects the Group's adjusted
cash flow from operations to reduce from EUR 85 million in F2023 to
annual levels of about EUR 70 to 75 million in the forecast period.
Free cash flow (after capital expenditures and working capital) is
anticipated to be moderately positive, and thus the Group may
potentially require the use of its available liquidity reserves to
assist in servicing principal debt repayments. The Intralot Group's
foreign exchange exposure may also result in potential negative
cash translation impacts. Overall, for the period to F2025,
Morningstar DBRS expects the Intralot Group's credit metrics to
continue to support the assigned credit rating, including adjusted
cash flow-to-debt greater than 15%, debt-to-proportionate EBITDA
less than 4.5x, and proportionate EBITDA-to-interest of at least
2.7x.
CREDIT RATING RATIONALE
The Intralot Group is exposed to a degree of concentration risk
arising from its limited number of contracts; however its
operations are moderately diversified by geography including the
United States and Canada (49% of F2023 EBITDA), Europe (15%),
Turkey (14%), Oceania (13%), South America (6%), and others (3%).
As a proportion of F2023 revenue, the Intralot Group estimates that
approximately 35% was generated through multi-year contracts or
renewable licenses that extend to 2028 (excluding extension
options), and 47% with consideration of extension options. Due to
the Group's limited number of contracts and the maturities over the
near-to-medium term, the continuation of its track record in
renewing these agreements with similar terms is critical to
maintaining its current levels of revenue and earnings,
particularly with consideration of the lead time required for new
business to become operational due to the technologically
integrated nature of the Group's services with its customers'
systems.
The Intralot Group has recently completed a significant refinancing
and financial restructuring transaction, which resulted in the
paydown and refinance of the outstanding Facility B Senior Notes
issued by Intralot Capital Luxembourg SA (a subsidiary of Intralot
S.A.), which were due to mature 15 September 2024. The repayment
and refinancing of these notes were executed by way of financial
instruments issued by Intralot S.A., which included (i) a share
capital increase of EUR 135 million completed in November 2023;
(ii) the Issuance of a EUR 130 million in common bonds in February
2024; and (iii) a EUR 100 million syndicated loan agreement with
five Greek banks, which funded on 28 March 2024. The Group fully
repaid the remaining balance of the Facility B Notes of EUR 99.6
million on 9 April 2024. This refinancing exercise extended and
distributed the Group's debt maturities, as the EUR 100 million
syndicated loan will mature 30 June 2025, while the EUR 130 million
in common bonds were issued with a five-year term maturing in
February 2029.
In March 2024, the Group announced that it has also extended the
existing debt of the U.S. subgroup by one year to 27 July 2026 with
no change to the existing lending terms. As of F2023, the U.S.
subgroup's debt included an amortizing term loan with an
outstanding balance of about EUR 194 million equivalent and an
undrawn USD 50 million revolving credit facility (RCF) limit.
The share capital increase and the refinancing activities have been
beneficial in terms of reducing the Group's total debt and
diversifying its financing sources and associated maturities.
However, there remains two significant loan maturities within the
next two to three years, which will continue to pose refinancing
risks, albeit to a lesser degree than prior to this most recent
refinancing initiative. The Intralot Group's ability to maintain
its portfolio of contracts and execute its growth strategy remain
imperative to securing future financing as its respective debt
maturities approach.
The Group's available liquidity as at F2023 was approximately EUR
158 million, inclusive of EUR 112 million of consolidated cash and
cash equivalents, and circa EUR 46 million equivalent available
under the U.S. subgroup's undrawn RCF. Morningstar DBRS notes that
reported F2023 consolidated cash balances are inclusive of circa
EUR 35 million equivalent held in the U.S. subgroup and about EUR
14 million equivalent held in 50.01% owned partnership
subsidiaries.
The Intralot Group's consolidated results include the full
contribution of its 50.01% stakes in partnership subsidiaries in
Turkey and Argentina, which together represented 22% of the Group's
consolidated F2023 EBITDA. Due to the materiality of these
non-wholly owned subsidiaries, Morningstar DBRS calculates the
Group's key credit metrics using a proportionate approach to better
reflect this economic relationship. Within the key credit metrics,
adjusted proportionate EBITDA is net of EBITDA attributable
noncontrolling interests of non-wholly owned subsidiaries, while
adjusted cash flow from operations is net of dividends paid to
non-controlling interests of non-wholly owned subsidiaries.
BUSINESS RISK ASSESSMENT (BRA) AND FINANCIAL RISK ASSESSMENT (FRA)
(A) Weighting of BRA Factors
In the analysis of Intralot S.A., the relative weighting of the BRA
factors was approximately equal.
(B) Weighting of FRA Factors
In the analysis of Intralot S.A., the relative weighting of the FRA
factors was approximately equal.
(C) Weighting of the BRA and the FRA
In the analysis of Intralot S.A., the BRA and the FRA carry
approximately equal weight.
Notes: All figures are in Euros unless otherwise noted.
=============
I R E L A N D
=============
BAIN CAPITAL 2024-1: S&P Assigns B- (sf) Rating to Class F Notes
----------------------------------------------------------------
S&P Global Ratings assigned its credit ratings to Bain Capital Euro
CLO 2024-1 DAC's class X, B-1, B-2, C, D, E, and F notes. At
closing, the issuer also issued unrated subordinated notes.
The ratings assigned to Bain Capital Euro CLO 2024-1's notes
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.
-- The issuer's legal structure, which is bankruptcy remote.
-- The transaction's counterparty risks, which are in line with
S&P's counterparty rating framework.
Portfolio benchmarks
CURRENT
S&P Global Ratings' weighted-average rating factor 2,769.09
Default rate dispersion 570.92
Weighted-average life (years) 4.38
Obligor diversity measure 152.32
Industry diversity measure 22.92
Regional diversity measure 1.23
Weighted-average life (years) extended
to cover the length of the reinvestment period 4.50
Transaction key metrics
CURRENT
Portfolio weighted-average rating
derived from S&P's CDO evaluator B
'CCC' category rated assets (%) 2.02
Actual 'AAA' weighted-average recovery (%) 37.48
Actual 'AA' weighted-average recovery (%) 47.21
Actual weighted-average coupon (%) 5.06
Actual weighted-average spread (net of floors; %) 4.09
Under the transaction documents, the rated notes will pay quarterly
interest unless there is a frequency switch event. Following this,
the notes will permanently switch to semiannual payment.
The portfolio's reinvestment period will end approximately 4.5
years after closing, while the non-call period will be 1.5 year
after closing.
In the interest waterfall, after the reinvestment period the
coverage tests are calculated by applying all available principal
proceeds, on each payment date, to amortize the most senior
outstanding class, so less interest proceeds will be used to cure
the tests.
S&P said, "On the effective date, we expect that the portfolio will
be well-diversified, primarily comprising broadly syndicated
speculative-grade senior secured term loans and senior secured
bonds. Therefore, we have conducted our credit and cash flow
analysis by applying our criteria for corporate cash flow CDOs. As
such, we have not applied any additional scenario and sensitivity
analysis when assigning ratings to any classes of notes in this
transaction.
"In our cash flow analysis, we used the EUR400.00 million target
par, a covenanted weighted-average spread (4.05%), a covenanted
weighted-average coupon (4.90%), and the actual weighted-average
recovery rates. 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.
"Our credit and cash flow analysis indicates that the available
credit enhancement for the class B-1 to F notes could withstand
stresses commensurate with higher ratings than those we have
assigned. However, as the CLO will be in its reinvestment phase
starting from closing, during which the transaction's credit risk
profile could deteriorate, we have capped our ratings assigned to
the notes.
"Under our structured finance ratings above the sovereign criteria,
we consider that the transaction's exposure to country risk is
sufficiently mitigated at the assigned rating levels.
"The transaction's documented counterparty replacement and remedy
mechanisms adequately mitigate the exposure to counterparty risk
under our current counterparty criteria.
"The issuer's legal structure is bankruptcy remote, in line with
our legal criteria.
"Following our analysis of the credit, cash flow, counterparty,
operational, and legal risks, we believe our ratings are
commensurate with the available credit enhancement for the class
B-1 to F notes.
"In addition to our standard analysis, to provide an indication of
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 X and B-1 to E
notes, based on four hypothetical scenarios.
"As our ratings analysis makes additional considerations before
assigning ratings in the 'CCC' category, and we would assign a 'B-'
rating if the criteria for assigning a 'CCC' category rating are
not met, we have not included the above scenario analysis results
for the class F notes."
Environmental, social, and governance
S&P said, "We regard the exposure to environmental, social, and
governance (ESG) credit factors in the transaction as being broadly
in line with our 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 (non-exhaustive list): coal, banned
wastes, weapons or firearms, palm oil, opioid, predatory lending
activities, gambling, pornography, prostitution, civilian weapons
or firearms, nuclear weapons, thermal coal, controversial weapons,
endangered or protected wildlife, activities adversely affecting
animal welfare, speculative transactions of soft commodities,
hazardous chemicals, tobacco, and illegal drugs and narcotics
including marijuana. Accordingly, since the exclusion of assets
from these industries does not result in material differences
between the transaction and our ESG benchmark for the sector, we
have not made any specific adjustments in our rating analysis to
account for any ESG-related risks or opportunities."
Bain Capital Euro CLO 2024-1 is a European cash flow CLO
securitization of a revolving pool, comprising euro-denominated
senior secured loans and bonds issued mainly by speculative-grade
borrowers. Bain Capital Credit U.S. CLO Manager II LP manages the
transaction.
Ratings
AMOUNT CREDIT
CLASS RATING* (MIL. EUR) ENHANCEMENT (%) INTEREST RATE§
X AAA (sf) 2.00 N/A Three/six-month EURIBOR
plus 0.50%
A NR 248.00 38.00 Three/six-month EURIBOR
plus 1.48%
B-1 AA (sf) 34.00 27.00 Three/six-month EURIBOR
plus 2.25%
B-2 AA (sf) 10.00 27.00 5.85%
C A (sf) 23.00 21.25 Three/six-month EURIBOR
plus 2.90%
D BBB- (sf) 27.00 14.50 Three/six month EURIBOR
plus 4.50%
E BB- (sf) 18.00 10.00 Three/six-month EURIBOR
plus 6.98%
F B- (sf) 12.00 7.00 Three/six-month EURIBOR
plus 8.30%
M NR 0.50 N/A N/A
Sub NR 25.80 N/A N/A
*The ratings assigned to the class X, B-1, and B-2 notes address
timely interest and ultimate principal payments. The ratings
assigned to the class C to 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.
NR--Not rated.
N/A--Not applicable.
EURIBOR--Euro Interbank Offered Rate.
MADISON PARK VIII: Moody's Hikes Rating on EUR11.5MM F Notes to B2
------------------------------------------------------------------
Moody's Ratings has upgraded the ratings on the following notes
issued by Madison Park Euro Funding VIII DAC:
EUR48,300,000 Class B Senior Secured Floating Rate Notes due 2032,
Upgraded to Aa1 (sf); previously on Feb 3, 2022 Affirmed Aa2 (sf)
EUR27,600,000 Class C-R Senior Secured Deferrable Floating Rate
Notes due 2032, Upgraded to A1 (sf); previously on Feb 3, 2022
Definitive Rating Assigned A2 (sf)
EUR11,500,000 (current outstanding amount EUR6,102,067.36) Class F
Senior Secured Deferrable Floating Rate Notes due 2032, Upgraded to
B2 (sf); previously on Feb 3, 2022 Affirmed B3 (sf)
Moody's has also affirmed the ratings on the following notes:
EUR287,500,000 Class A-R Senior Secured Floating Rate Notes due
2032, Affirmed Aaa (sf); previously on Feb 3, 2022 Definitive
Rating Assigned Aaa (sf)
EUR29,900,000 Class D-R Senior Secured Deferrable Floating Rate
Notes due 2032, Affirmed Baa3 (sf); previously on Feb 3, 2022
Definitive Rating Assigned Baa3 (sf)
EUR23,000,000 Class E Senior Secured Deferrable Floating Rate
Notes due 2032, Affirmed Ba3 (sf); previously on Feb 3, 2022
Affirmed Ba3 (sf)
Madison Park Euro Funding VIII DAC, issued in December 2016 and
refinanced in February 2022, is a collateralised loan obligation
(CLO) backed by a portfolio of mostly high-yield senior secured
European loans. The portfolio is managed by Credit Suisse Asset
Management Limited. The transaction's reinvestment period ended in
April 2024.
RATINGS RATIONALE
The rating upgrades on the Class B, C-R and F notes are primarily a
result of the benefit of the transaction having reached the end of
the reinvestment period in April 2024.
The affirmations on the ratings on the Class A-R, D-R and E notes
are primarily a result of the expected losses on the notes
remaining consistent with their current rating levels, after taking
into account the CLO's latest portfolio, its relevant structural
features and its actual over-collateralisation 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.
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: EUR451m
Defaulted Securities: EUR11.6m
Diversity Score: 66
Weighted Average Rating Factor (WARF): 2872
Weighted Average Life (WAL): 4.42 years
Weighted Average Spread (WAS) (before accounting for Euribor
floors): 4.05%
Weighted Average Coupon (WAC): 4.73%
Weighted Average Recovery Rate (WARR): 43.5%
Par haircut in OC tests and interest diversion test: 0%
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.
Moody's notes that the April 2024 trustee report was published at
the time it was completing its analysis of the March 2024 data. Key
portfolio metrics such as WARF, diversity score, weighted average
spread and life, and OC ratios exhibit little or no change between
these dates.
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, using the
methodology "Moody's Approach to Assessing Counterparty Risks in
Structured Finance methodology" published in October 2023. 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.
=========
I T A L Y
=========
NEOPHARMED GENTILI: S&P Assigns 'B' Long-Term ICR, Outlook Stable
-----------------------------------------------------------------
S&P Global Ratings assigned its 'B' long-term issuer credit rating
to Italy-based pharmaceutical company Neopharmed Gentili SpA
(Neopharmed), the parent company of the group and the debt's
issuer. S&P assigned its 'B' issue rating to Neopharmed's EUR750
million senior secured notes, due in 2030. The recovery rating is
'4' (recovery range: 30%-50%; rounded estimate: 40%).
S&P does not rate the super senior RCF.
S&P said, "The outlook is stable because we expect Neopharmed's
EBITDA growth will continue thanks to solid organic top-line
growth, profitability improvements, and lower restructuring costs
from 2024, which will help deleveraging, with our adjusted debt to
EBITDA at about 6.5x-7.0x in 2024 and 6.0x-6.5x in 2025 and the
EBITDA interest coverage ratio improving to 1.8x-2.0x in 2024 and
remaining above 2.0x thereafter.
"Neopharmed benefits from a large, diversified portfolio of branded
off-patent products, with a leading market position in Italy. In
our view, Neopharmed has adequate diversification by therapeutic
area, with cardiovascular accounting for 40% of total sales in
2023, neurology representing 22%, allergo-respiratory 15%, and
musculoskeletal and others 23%. We positively note that the
company's portfolio of 124 products does not show any significant
concentration, and there is no significant dependency on any single
drug. Specifically, the top-selling product accounts for 8% of
sales and the top three products combined represent 23% of sales.
Most products are proprietary, accounting for 81% of total sales in
2023, with the remaining 19% being licensed.
"Overall, 94% of products are prescribed. We view this as a
significant advantage for the company, considering the historical
preference in Italy for branded products over generics and the high
conversion of prescriptions into customer purchases. Most of
Neopharmed's products have been on the market for over 25 years,
with proven long-term effectiveness. About 74% of Neopharmed's
revenue is generated by products with top three leading market
positions. We also acknowledge that Neopharmed's portfolio is 100%
off-patent, which ensures no exclusivity expiration risk. Overall,
we view Neopharmed strategy as de-risked and consistent with the
enterprise's capabilities.
"We believe that the large network of agents and representatives is
a key competitive advantage for Neopharmed. Neopharmed benefits
from a large scientific information network, with over 400
pharmaceutical agents and representatives dedicated to the active
promotion of brands to general practitioners and specialists across
Italy. In our view, the experienced workforce provides good
barriers to entry, somewhat mitigating competition risk, and is key
to identifying the right prescribers. This is crucial to increase
sales volumes, which is the main topline driver according to our
base-case scenario."
Neopharmed does not have any significant supplier or customer
concentration. The company outsources the manufacturing of drugs to
over 60 contract manufacturing organizations (CMOs) as well as to
50 active pharmaceutical ingredient (API) suppliers, with the top
five suppliers contributing about 40% of 2023 total procurement.
S&P said, "Moreover, we note that Neopharmed reduces supply chain
risk thanks to dual-sourcing initiatives for top products, and runs
in-house quality assessment and control of manufacturing and
distribution. We believe that Neopharmed has an efficient
distribution network, thanks to several wholesalers that distribute
Neopharmed's products to pharmacies, accounting for 97% of sales
(exposure to hospitals is only 3%)."
S&P's view of the business is constrained by Neopharmed's modest
scale of operations and high geographical concentration in Italy,
which exposes the company to competition and regulatory risks. With
revenue of about EUR266 million in 2023, Neopharmed has
significantly smaller scale than other players in the industry,
including rated peers such as Cheplapharm or Recordati. Moreover,
the company lacks geographical diversification, given that it
generates almost 100% of its revenue in Italy, which significantly
exposes the company to competition and regulatory risks.
Specifically, Neopharmed faces competition from other
pharmaceutical companies active in primary care that have higher
scale, larger financial resources, and vertical integration that
could allow them to develop their product portfolios more quickly,
leading to better product diversification, and they would have
higher resources to expand their promotional network by engaging
more representatives and agents than Neopharmed.
Moreover, the company does not engage in R&D and could therefore
face competition from new drugs launched by other players,
potentially challenging Neopharmed's market share. Moreover, while
the Italian regulatory framework has been rather stable over the
past several years, with stable healthcare spending at about 9% of
total GDP on average, unanticipated changes in laws and regulations
could harm the company's performance, which depends on the
macroeconomic and political conditions in Italy and related
uncertainties and volatility.
S&P said, "We believe that Neopharmed has limited potential for
international expansion, considering that the current strategy is
tailored to the Italian market. Neopharmed's business model has
proven resilient even during challenging market conditions, such as
the COVID-19 pandemic, mostly thanks to its focus on the niche
Italian market that benefits from the historically demonstrated
preference for branded drugs versus generic options. The same
preference is not present in several European markets, where
generic penetration is higher and different customer preferences
could challenge Neopharmed's business model. We believe that
Neopharmed can generate solid organic top-line growth without
significant mergers and acquisitions. While we do not factor any
acquisitions into our base case, due to the uncertainty on timing
and targets, we believe that Neopharmed could make international
investments and acquisitions in the pharmaceutical industry, which
could carry integration as well as execution risks.
"We expect that Neopharmed will continue to show above-average
market growth, thanks to its focus on chronic diseases and a strong
prescription rate among doctors. According to Euromonitor, the
retail pharmaceutical market in Italy is expected to grow at about
0%-1% between 2023 and 2027. Nevertheless, we project that
Neopharmed will largely exceed this growth rate in our forecast,
achieving top-line growth of about 3.5%-4.5% in 2024 and 2025. This
will be mostly thanks to new launches and organic growth supported
by its business model. The model focuses on a wide network of
pharmaceutical representatives combined with its portfolio of
branded established medicines that have a long prescription
history.
"We note as positive that Neopharmed is mostly active in
therapeutic areas, such as cardiovascular, neurology, and
allergo-respiratory, that target chronic diseases, ensuring
sustainability of long-term demand. Although Neopharmed faces
competition in the Italian market from peers, we believe that
overall competition from generic drugs is somewhat limited,
considering the limited price difference between the two types of
product and the population's strong preference for branded
products, which represent almost 80% of the pharmaceutical market
in Italy.
"Neopharmed's asset-light business model translates into high
EBITDA margins that we forecast at about 40%-42% in 2024-2025. We
project that Neopharmed's profitability will improve, with the S&P
Global Ratings-adjusted EBITDA margin reaching 40%-42% in 2024 and
2025, from 38% in 2023, mostly thanks to better operating leverage,
lower restructuring costs, synergies from recent acquisitions, and
better price negotiations with suppliers. We think that the group
can sustain this level of margin because it outsources all
manufacturing activities; the business is very scalable with low
fixed costs; and it can leverage its existing salesforce following
acquisitions."
Moreover, Neopharmed does not engage in R&D and applies an
efficient distribution strategy. This business models aids the
flexibility of the group's cost structure. At the same time,
outsourcing of manufacturing activities reduces control and could
result in unexpected supply disruption, although this risk is
mitigated by dual sourcing. S&P understands that the company
manages this risk through an internal team dedicated to supply
chain and quality organization, its wide network of contract
manufacturing partners, and an efficient approach to stock
management.
S&P said, "We forecast that Neopharmed will generate solid FOCF of
EUR35 million-EUR40 million in 2024, improving to above EUR50
million from 2025, thanks to its capital expenditure (capex)-light
business model and limited working capital requirements. We project
that Neopharmed's FOCF will significantly improve in 2024 from
2023, when the company's FOCF generation was impaired by
restructuring costs of about EUR17 million, a one-off working
capital outflow of about EUR15 million related to the Valeas
acquisition, and high cash interest expenses of about EUR71
million. From 2024, we expect that reduced restructuring costs of
about EUR3 million-EUR5 million, limited capex of about EUR1
million-EUR2 million, normalized working capital, and a lower cost
of debt of about EUR50 million–EUR60 million following the
refinancing will support cash flow generation, with FOCF standing
at about EUR35 million-EUR40 million. We expect that FOCF will
further improve in 2025, to about EUR50 million-EUR55 million,
mostly due to higher absolute EBITDA. Moreover, we project that
adjusted EBITDA interest coverage will improve to 1.8x-2.0x in 2024
and above 2.0x in 2025, from 1.4x in 2023. We believe that if
adjusted EBITDA interest coverage falls below 2.0x, the cost of
debt would become difficult to sustain. As such, rating headroom is
currently limited.
"We view Neopharmed's capital structure as highly leveraged after
the refinancing, with adjusted debt to EBITDA at about 6.5x-7.0x in
2024 before deleveraging to 6.0x-6.5x in 2025. Following the
refinancing in April 2024, S&P Global Ratings-adjusted debt
included the senior secured notes of EUR750 million, which were
used to refinance the existing EUR700 million unitranche and pay
for transaction fees and expenses. The EUR130 million RCF was fully
undrawn at the transaction's close, and we expect it will remain
undrawn during our forecast period. We note that the company does
not have any significant pension or leasing liabilities and does
not make use of factoring.
"We expect that leverage will decline to 6.5x-7.0x in 2024 from
7.2x in 2023, with higher absolute EBITDA more than compensating
for higher financial debt. We project that continued profitability
improvements and solid top-line growth will drive leverage down in
2025, with S&P Global Ratings-adjusted debt standing at 6.0x-6.5x.
Given the private equity ownership by NB Renaissance and Ardian, we
believe that Neopharmed's appetite for deleveraging is low, and we
assume that self-generated cash flow will fund external development
opportunities rather than debt reduction. Therefore, we do not
deduct cash balances from our calculation of adjusted debt.
"The stable outlook reflects our expectation that Neopharmed will
continue to generate solid organic growth, also supported by the
stable regulatory environment and by the favorable market dynamics
in Italy, achieving an S&P Global Ratings-adjusted EBITDA margin in
the 40%-42% range and FOCF to debt of 4%-5% in the next 12 months.
We expect that the adjusted debt-to-EBITDA ratio will stand at
about 6.5x-7.0x in 2024, improving to 6.0x-6.5x in 2025, and that
the EBITDA interest coverage ratio will improve above 2.0x over the
next 12-18 months.
"We could lower the rating if Neopharmed's operating performance
deviates materially from our base case, for instance due to higher
competition or unfavorable changes in the Italian regulatory
framework, so that adjusted EBITDA interest coverage fails to
improve to 2.0x for a protracted period. We could also lower the
rating if FOCF turned negative due to higher-than-expected cash
interest payments, or due to higher restructuring costs or working
capital outflows following acquisitions, or if the financial
sponsor engaged in higher shareholder remuneration.
"We could raise the rating if we were convinced that the financial
sponsor would consistently support the group's deleveraging
trajectory such that adjusted debt to EBITDA could remain
comfortably below 5x, supported by sustained FOCF generation and a
commitment to maintain leverage in line with a higher rating. We
also could consider a positive rating action if the company
markedly increased the scale and diversity of its product
offerings, but we do not expect this in the near term.
"Governance factors are a moderately negative consideration in our
credit rating analysis of Neopharmed, because of its controlling
ownership. We view financial sponsor-owned companies with
aggressive or highly leveraged financial risk profiles as
demonstrating corporate decision-making that prioritizes the
interests of the controlling owners. This also reflects the
generally finite holding periods and a focus on maximizing
shareholder returns."
=====================
N E T H E R L A N D S
=====================
JUBILEE PLACE 6: DBRS Gives Prov. BB Rating to Class E Notes
------------------------------------------------------------
DBRS Ratings GmbH assigned provisional credit ratings to the
residential mortgage-backed notes to be issued by Jubilee Place 6
B.V. (the Issuer) as follows:
-- Class A notes at AAA (sf)
-- Class B notes at AA (low) (sf)
-- Class C notes at A (high) (sf)
-- Class D notes at BBB (high) (sf)
-- Class E notes at BB (sf)
-- Class X1 notes at BBB (sf)
The provisional credit rating on the Class A notes addresses the
timely payment of interest and the ultimate repayment of principal
by the legal final maturity date in September 2060. The provisional
credit rating on the Class B notes addresses the timely payment of
interest when most senior and the ultimate payment of principal by
the legal final maturity date. The provisional credit ratings on
the Class C, Class D, and Class X1 notes address the ultimate
payment of interest and principal by the legal final maturity date.
The provisional credit rating on the Class E notes addresses the
ultimate payment of principal by the legal final maturity date.
Morningstar DBRS does not rate the Class S1, Class S2, Class X2, or
Class R notes also expected to be issued in this transaction.
CREDIT RATING RATIONALE
Jubilee Place 6 B.V. will be a bankruptcy-remote special-purpose
vehicle incorporated in the Netherlands. The Issuer will use the
proceeds from the issued notes to fund the purchase of Dutch
mortgage receivables originated by Dutch Mortgage Services B.V.,
DNL 1 B.V., and Community Hypotheken B.V. (the originators), which
will be acquired from Citibank, N.A., London Branch (the seller).
The originators are specialized residential buy-to-let (BTL) real
estate lenders operating in the Netherlands and started their
lending businesses in 2019. They operate under the mandate of
Citibank, which defines most of the underwriting criteria and
policies.
As of 29 February 2024, the provisional portfolio consisted of 818
loans with a total portfolio balance of approximately EUR 299.1
million. The weighted-average (WA) seasoning of the portfolio is
1.2 years with a WA remaining term of 32.3 years. The WA current
loan-to-value ratio, at 68.7%, is in line with that of other Dutch
BTL RMBS transactions. The loan parts in the portfolio are either
interest-only loans (92.8%) or annuity mortgage loans (7.2%). A
significant portion of the loans were granted for the purpose of
equity release (49.0%). All of the loans in the portfolio are fixed
with a compulsory future switch to floating. The notes pay a
floating rate. To address this interest rate mismatch, the
transaction is structured with a fixed-to-floating interest rate
swap where the Issuer pays a fixed rate and receives three-month
Euribor over a notional, which is a defined amortization schedule.
There are no loans in arrears in the portfolio.
Morningstar DBRS calculated the credit enhancement for the Class A
notes at 10.65%, which is provided by the subordination of the
Class B to Class E notes and the liquidity reserve fund. Credit
enhancement for the Class B notes will be 4.75% and will be
provided by the subordination of the Class C to Class E notes and
the liquidity reserve fund. Credit enhancement for the Class C
notes will be 2.25% and will be provided by the subordination of
the Class D to Class E notes and the liquidity reserve fund. Credit
enhancement for the Class D notes will be 0.50% and will be
provided by the subordination of the Class E notes and the
liquidity reserve fund. Credit enhancement for the Class E notes
will be 0.25% and will be provided by the liquidity reserve fund.
The transaction benefits from an amortizing liquidity reserve fund
(LRF) that can be used to cover shortfalls on senior expenses and
interest payments on the Class A notes and Class B notes once most
senior. The LRF will be partially funded at closing at 0.25% of
(100/95) of the initial balance of the Class A and Class B notes
and will build up until it reaches its target of 1.10% (100/95) of
the outstanding balance of the Class A and Class B notes. The LRF
is floored at 0.75% (100/95) of the initial balance of the Class A
and Class B notes until the first optional redemption date. The LRF
indirectly provides credit enhancement for all classes of notes, as
released amounts will be part of the principal available funds.
Additionally, the notes will be provided with liquidity support
from principal receipts, which can be used to cover senior expenses
and interest shortfalls on the Class A notes or the most-senior
class of notes outstanding once the Class A notes have been fully
amortized.
The Issuer will enter into a fixed-to-floating swap with Citibank
Europe plc (rated AA (low) with a Stable trend by Morningstar DBRS)
to mitigate the fixed interest rate risk from the mortgage loans
and the three-month Euribor payable on the loan and the notes. The
notional of the swap is a pre-defined amortization schedule of the
assets. The Issuer will pay a fixed swap rate and receive
three-month Euribor in return. The swap documents are in line with
Morningstar DBRS' "Derivative Criteria for European Structured
Finance Transactions" methodology.
The Issuer Account Bank is Citibank Europe plc, Netherlands Branch.
Based on Morningstar DBRS' private credit rating on the account
bank, the downgrade provisions outlined in the transaction
documents, and structural mitigants inherent in the transaction
structure, Morningstar DBRS considers the risk arising from the
exposure to the account bank to be consistent with the credit
ratings assigned to the notes, as described in Morningstar DBRS'
"Legal Criteria for European Structured Finance Transactions"
methodology.
Morningstar DBRS based its credit ratings primarily on the
following considerations:
-- The transaction capital structure, including the form and
sufficiency of available credit enhancement and liquidity
provisions.
-- The credit quality of the mortgage loan portfolio and the
ability of the servicer to perform collection activities.
Morningstar DBRS calculated portfolio default rates (PDs), loss
given default (LGD), and expected loss (EL) outputs on the mortgage
loan portfolio.
-- The ability of the transaction to withstand stressed cash flow
assumptions and repay the notes according to the terms of the
transaction documents. Morningstar DBRS analyzed the transaction
cash flows using the PD and LGD outputs provided by Morningstar
DBRS' European RMBS Insight Model. Morningstar DBRS analyzed
transaction cash flows using Intex DealMaker.
-- The structural mitigants in place to avoid potential payment
disruptions caused by operational risk, such as
a downgrade and replacement language in the transaction documents.
-- The consistency of the transaction's legal structure with
Morningstar DBRS' "Legal Criteria for European Structured Finance
Transactions" methodology and the presence of legal opinions
addressing the assignment of the assets to the Issuer.
Morningstar DBRS' credit ratings on the Class A to Class X1 notes
address the credit risk associated with the identified financial
obligations in accordance with the relevant transaction documents.
The associated financial obligations are the related Interest
Payment Amounts and the related Class Balances.
Morningstar DBRS' credit rating does not address nonpayment risk
associated with contractual payment obligations contemplated in the
applicable transaction documents that are not financial
obligations.
Morningstar DBRS' long-term credit ratings provide opinions on risk
of default. Morningstar DBRS considers risk of default to be the
risk that an issuer will fail to satisfy the financial obligations
in accordance with the terms under which a long-term obligation has
been issued.
Notes: All figures are in euros unless otherwise noted.
JUBILEE PLACE 6: S&P Assigns BB (sf) Rating to Class X1 Notes
-------------------------------------------------------------
S&P Global Ratings has assigned credit ratings to Jubilee Place 6
B.V.'s class A, E, and X1 notes and class B-Dfrd to D-Dfrd interest
deferrable notes. At closing, the issuer also issued unrated S1 and
S2 notes and unrated class X2 and class R notes.
Jubilee Place 6 is an RMBS transaction that securitizes a portfolio
of buy-to-let (BTL) mortgage loans secured on properties located in
the Netherlands. This is the sixth Jubilee Place transaction,
following Jubilee Place 2020-1, 2021-1, 3, 4, and 5, which were
also rated by S&P Global Ratings.
The loans in the pool were originated by DNL 1 B.V. (18.49%;
trading as Tulp), Dutch Mortgage Services B.V. (57.14%; trading as
Nestr), and Community Hypotheken B.V. (24.36%; trading as
Casarion).
All three originators are experienced lenders in the Dutch BTL
market. The key characteristics and performance to date of their
mortgage books are similar with peers. Moreover, Citibank N.A.,
London Branch (Citi) maintains significant oversight in operations,
and due diligence is conducted by an external company, Fortrum,
which completes an underwriting audit of all the loans for each
lender before a binding mortgage offer can be issued.
At closing, the issuer used the issuance proceeds to purchase the
full beneficial interest in the mortgage loans from the seller. The
issuer grants security over all its assets in favor of the security
trustee.
Citi retains an economic interest in the transaction in the form of
a vertical risk retention loan note accounting for 5% of the pool
balance at closing. The remaining 95% of the pool will be funded
through the proceeds of the mortgage-backed rated notes.
S&P considers the collateral to be prime, based on the originators'
prudent lending criteria, and the absence of loans in arrears in
the securitized pool.
Credit enhancement for the rated notes consists of subordination
from the closing date and the liquidity reserve fund, with any
excess amount over the target being released to the principal
priority of payment.
The class A and B-Dfrd notes benefit from liquidity support in the
form of a liquidity reserve (the latter notes only when they become
the most senior), and the class A through D-Dfrd notes benefit from
the ability of principal to be used to pay interest, provided that,
in the case of the class B-Dfrd to D-Dfrd notes, they are the most
senior class outstanding.
S&P said, "There are no rating constraints in the transaction under
our counterparty, operational risk, or structured finance sovereign
risk criteria. We consider the issuer to be bankruptcy remote and
the legal framework to be compliant with our legal criteria."
Ratings
CLASS RATING* CLASS SIZE (%)
A AAA (sf) 89.60
B-Dfrd AA- (sf) 5.90
C-Dfrd A (sf) 2.50
D-Dfrd BBB+ (sf) 1.75
E BBB (sf) 0.25
X1 BB (sf) 1.50
X2 NR 0.89
S1 NR N/A
S2 NR N/A
R NR N/A
*S&P said, "Our ratings address timely receipt of interest and
ultimate repayment of principal on the class A notes, the ultimate
payment of interest and principal on the class B-Dfrd to D-Dfrd
notes and the class X1 notes, and the payment of principal on the
class E notes. Our ratings also address the timely receipt of
interest on the rated notes when they become most senior
outstanding."
NR--Not rated.
N/A--Not applicable.
===========
R U S S I A
===========
APEX LIFE: S&P Assigns 'B+' Fin'l. Strength Rating, Outlook Stable
------------------------------------------------------------------
S&P Global Ratings assigned its 'B+' financial strength rating to
Uzbekistan-based Apex Life Insurance JSC (Apex Life). The outlook
is stable.
The rating on Apex Life mainly reflects the company's high
integration into the Apex Insurance group, the related reputational
factors, and the life insurer's high importance for the group's
business development strategy for 2024-2026. S&P said, "We expect
that Apex Life will benefit from support from the parent if needed
in any foreseeable circumstances. As a result, we equalize our
long-term rating on Apex Life with the 'b+' group credit profile of
Apex Insurance."
Apex Life was created in May 2019 as a 100% subsidiary of Apex
Insurance, one of the largest property/casualty insurers in
Uzbekistan with a market share of about 26% by net premium written
in 2023 in the domestic insurance sector. Since its inception, Apex
Life has been providing term life insurance, endowment insurance,
and accident and health insurance (including voluntary and
obligatory insurance). Despite the life insurer being only a small
part of Apex Insurance as measured by assets (4%) and capital
(12%), it is integral to Apex Insurance's growth strategy and a
core component of the group's development of joint cross-selling.
This means a significant increase in the quality of customer
service, as well as contribution to the group's diversification and
growth by offering life products to retail clientele.
Apex Life is closely integrated with Apex Insurance--operationally,
strategically, and financially. Apex Life shares the same
underwriting and claims controls as the parent and receives board
oversight from Apex Insurance on investment policy and risk
management practices. Apex Insurance uses it as a platform to sell
policies to retail clientele. Apex Life also utilizes the group's
name and is therefore closely linked to the reputation of Apex
Insurance--supporting our view of Apex Life's core group status.
S&P said, "We believe that the parent would likely provide
financial support if needed. Apex Life received an additional
capital support of Uzbekistani sum (UZS) 14 billion in 2023 and
UZS11 billion in 2022 to support the growth of the business and
realization of the strategy. Although it does not meet our
guarantee criteria requirement, we also think that the letter of
guarantee issued by Apex Insurance that unconditionally guarantees
fulfilment of all obligations issued by Apex Life in case of the
life company being in distress, indicates this commitment to
support.
"Our stable outlook on Apex Life mirrors that on Apex Insurance and
reflects our view that its importance to the parent will remain
broadly unchanged over the next 12 months. The rating on Apex Life
will move in tandem with that on Apex Insurance, unless we revise
our view of Apex Life's group status.
"We could take a negative rating action in the next 12 months on
Apex Life if we see pressure on the rating on Apex Insurance.
Although not expected, we could also take a negative rating action
on Apex Life if we saw diminishing support from Apex Insurance to
its subsidiary, particularly in respect of capital support. This
could weaken our view of the company's group status.
"We could take a positive rating action on Apex Life over the next
12 months if we take a positive rating action on Apex Insurance."
Environmental, Social, And Governance
S&P said, "Governance factors are a negative consideration in our
credit rating analysis of Apex Life and other rated insurers in
Uzbekistan. This is mainly driven by our assessment of Uzbekistan's
governance practices. In particular, the institutional framework is
evolving but lags some emerging and most developed markets, while
the quality and level of disclosures remain limited. In our view,
these risks reduce insurers' predictability of performance in
Uzbekistan."
=========
S P A I N
=========
CAIXABANK CONSUMO 5: DBRS Hikes Series B Notes Rating to BB(high)
-----------------------------------------------------------------
DBRS Ratings GmbH upgraded its credit ratings on the Series A Notes
and Series B Notes (together, the Notes) issued by Caixabank
Consumo 5 F.T. (the Issuer) as follows:
-- Series A Notes upgraded to AAA (sf) from AA (high) (sf)
-- Series B Notes upgraded to BB (high) (sf) from B (high) (sf)
The credit rating on the Series A Notes addresses the timely
payment of interest and the ultimate payment of principal on or
before the legal final maturity date in October 2054. The credit
rating on the Series B Notes addresses the ultimate payment of
interest and principal on or before the legal final maturity date.
The upgrades follow an annual review of the transaction and are
based on the following analytical considerations:
-- Portfolio performance, in terms of delinquencies, defaults, and
losses, as of the January 2024 payment date;
-- Probability of default (PD), loss given default (LGD), and
expected loss assumptions on the remaining receivables; and
-- Current available credit enhancement to the Notes to cover the
expected losses at their respective credit rating levels.
The transaction is a securitization of unsecured consumer loans
granted to individuals residing in Spain by CaixaBank, S.A.
(CaixaBank), which also services the portfolio and acts as the
Issuer account bank. The transaction closed in June 2020. At
closing, the static EUR 3.6 billion collateral portfolio consisted
of loans granted primarily to borrowers in Catalonia (31.5% of the
initial portfolio balance), Andalusia (17.6%), and Madrid (10.5%).
As of the January 2024 payment date, the outstanding collateral
portfolio stood at EUR 474.8 million.
PORTFOLIO PERFORMANCE
As of the January 2024 payment date, loans that were 0 to 30 days,
30 to 60 days, and 60 to 90 days delinquent represented 0.5%, 0.3%,
and 0.03% of the outstanding portfolio balance, respectively, while
loans more than 90 days delinquent represented 4.1%. Gross
cumulative defaults amounted to 4.7% of the aggregate original
portfolio balance, with cumulative recoveries of 14.5% to date.
PORTFOLIO ASSUMPTIONS AND KEY DRIVERS
Morningstar DBRS conducted a loan-by-loan analysis of the remaining
pool of receivables and updated its base case PD and LGD
assumptions to 6.0% and 71.4%, respectively.
CREDIT ENHANCEMENT
The subordination of the Series B Notes and the cash reserve
provides credit enhancement to the Series A Notes while the cash
reserve provides credit enhancement to the Series B Notes only
following the full repayment of the Series A Notes. As of the
January 2024 payment date, credit enhancement to the Series A Notes
increased to 73.4% from 38.3% at the time of the last annual review
while credit enhancement to the Series B Notes increased to 6.1%
from 5.9%. The significant amortization of the Series A Notes and
increased credit enhancement prompted the upgrades on the Notes.
The transaction benefits from an amortizing cash reserve available
to cover senior expenses and all payments due on the senior-most
class of notes outstanding at the time. The reserve was funded to
EUR 177.5 million at closing through a subordinated loan granted by
CaixaBank and, as long as the reserve has been replenished to its
target level on the previous payment date, it will amortize to its
target level of 5.0% of the outstanding principal balance of the
Notes. As of the January 2024 payment date, the reserve was at its
target amount of EUR 29.0 million.
CaixaBank acts as the account bank for the transaction. Based on
the account bank reference rating of A (high) on CaixaBank (which
is one notch below its Morningstar DBRS Long Term Critical
Obligations Rating of AA (low)), the downgrade provisions outlined
in the transaction documents, and other mitigating factors inherent
in the transaction structure, Morningstar DBRS considers the risk
arising from the exposure to the account bank to be consistent with
the credit ratings assigned to the Notes, as described in
Morningstar DBRS' "Legal Criteria for European Structured Finance
Transactions" methodology.
Morningstar DBRS' credit ratings on the rated notes address the
credit risk associated with the identified financial obligations in
accordance with the relevant transaction documents.
Morningstar DBRS' credit ratings do not address nonpayment risk
associated with contractual payment obligations contemplated in the
applicable transaction documents that are not financial
obligations.
Morningstar DBRS' long-term credit ratings provide opinions on risk
of default. Morningstar DBRS considers risk of defaults to be the
risk that an issuer will fail to satisfy the financial obligations
in accordance with the term under which a long-term obligation has
been issued.
Notes: All figures are in euros unless otherwise noted.
=====================
S W I T Z E R L A N D
=====================
VERISURE MIDHOLDING: S&P Affirms 'B+' ICR on Proposed Refinancing
-----------------------------------------------------------------
S&P Global Ratings affirmed its 'B+' long-term issuer credit rating
on monitored alarm service provider Verisure Midholding AB
(Verisure). S&P also affirmed its 'B+' issue ratings on its senior
secured debt and its 'B-' issue ratings on its senior unsecured
debt.
S&P assigned its 'B+' issue rating to Verisure's proposed senior
secured debt.
The stable outlook reflects that S&P expects Verisure to achieve an
annual net subscriber and revenue growth of about 10%, while
keeping attrition and customer acquisition costs similar to 2023
levels. This will lead to an EBITDA margin of above 40%, about
breakeven FOCF, and debt to EBITDA declining towards 5x.
Verisure has launched a refinancing transaction to address 2026
debt maturities. On April 24, 2024, Verisure launched a EUR1
billion refinancing transaction whereby the company will issue an
additional term loan under the 2021 senior facility agreement and
additional senior secured debt, the proceeds will be used to
refinance its existing EUR800 million term loan maturing in 2026
and EUR200 million of drawings on its RCF. The transaction is
expected to improve the maturity profile of the capital structure
as the additional facility is anticipated to have a 2030 maturity.
We expect the transaction to be leverage neutral because all
proceeds will be used for debt repayment (and issuance fees).
Scale benefits that lead to less cash burn for new customers are
offset by a higher interest burden and investments in equipment
upgrades, leading to breakeven FOCF 2024-2025. S&P said, "In our
view, Verisure has ample growth opportunities, as the company
benefits from its strong market position (No. 1 in 13 of its 17
markets) in a still underpenetrated market for the residential
monitoring market in Europe (about 5%) and Latin America, compared
with more mature markets like the U.S. (about 20%). Therefore, we
forecast that Verisure will invest its entire cash flow to grow its
subscriber base. We expect that cost per acquisition (CPA) will
remain at about EUR1,420-EUR1,460 in 2024-2025 (EUR1,415 in 2023),
as we estimate that cost increases stemming from inflationary
pressure on labor and hardware will be balanced by benefits from
economies of scale."
S&P said, "We expect attrition to gradually come down to 7.0% from
a peak of 7.6% in 2023, and as a result we expect a net subscriber
(and revenue) growth of about 10.0%. The continued high subscriber
acquisition costs to support customer growth will translate to
annual capital expenditures (capex) of EUR600-EUR700 million in
2024-2025. In addition, we expect capex of about EUR300-EUR400
million annually (a gradual increase from about EUR250 million in
2022) to support investments in IT, new innovations, and equipment
upgrades to support the transition from 2G and 3G to 4G and 5G
networks. As a result, we expect a total annual capex of about EUR1
billion, which--in combination with a step up in annual interest
costs from about EUR300 in 2022 to EUR450 in 2024-2025 due to the
higher interest rate environment--will lead to an S&P Global
Ratings-adjusted FOCF of about breakeven in 2024-2025.
"We expect deleveraging to about 5.0x, which stems from an
expanding EBITDA and is supported by the new conservative financial
policy targeting leverage below 4.5x. In our view, the 10% net
subscriber growth should lead to an annual EBITDA growth of about
12%-15% and provides room for deleveraging even with a constant
level of debt. Given the financial policy of a leverage target of
below 4.5x (S&P Global Ratings-adjusted 5.0x) announced in February
2024 we regard any increase in debt as unlikely. As a result, we
assess that Verisure has the capacity and willingness to deleverage
toward 4.7x by year-end 2025, from about 5.7x in 2023.
"The stable outlook reflects that we expect Verisure to achieve an
annual net subscriber and revenue growth of about 10%, while
keeping attrition and customer acquisition costs similar to 2023
levels, leading to the EBITDA margin remaining above 40%, about
breakeven FOCF, and debt to EBITDA approaching 5.0x.
"Although unlikely in the coming 12 months, we could lower the
rating if the leverage exceeded 7.0x for a prolonged period while
FOCF remained negative. This could occur if Verisure increased debt
for large dividends or acquisitions or if its operating performance
deteriorated, for example due to higher attrition or loss of market
share stemming from increased competition or unfavorable
technological shifts."
S&P could raise the rating if S&P Global Ratings-adjusted leverage
declined and remained sustainably below 5.0x, supported by a
maintenance of the new financial policy, combined with FOCF turning
positive (at least EUR100 million on a sustainable basis), and
posting healthy growth.
===========
T U R K E Y
===========
TURKIYE SISE: Fitch Hikes LongTerm IDR to BB-, Outlook Positive
---------------------------------------------------------------
Fitch Ratings has upgraded glass manufacturer Turkiye Sise ve Cam
Fabrikalari AS's (Sisecam) Long-Term Foreign-Currency (FC) Issuer
Default Rating (IDR) to 'BB-', from 'B+'. The Outlook is Positive.
Fitch has also upgraded the senior unsecured ratings to 'BB-', from
'B+', with a Recovery Rating of 'RR4'.
Fitch has assigned an expected rating of 'BB-(EXP)' with Recovery
Rating of 'RR4' to the company's proposed benchmark notes to be
issued by Sisecam UK Plc and guaranteed by Sisecam. The final
rating is subject to the completion of refinancing and final
documentation confirming information already received. Fitch has
also assigned a Long-Term Local-Currency (LC) IDR of 'BB-' with a
Positive Outlook.
The Long-Term LC IDR benefits from Sisecam's diversified business
profile with strong profit margins and moderate through-the-cycle
leverage, which are offset by capex-driven negative free cash flow
(FCF), continued dependence on short-term funding and FX risks.
The Long-Term FC IDR upgrade reflects the company's credit
enhancements, such as the recently established offshore
hard-currency (HC) liquidity and growing offshore EBITDA
generation, that allow a notch uplift above Turkiye's 'B+' Country
Ceiling (CC) under its Country Ceiling Criteria.
The Positive Outlook reflects Turkiye's sovereign rating outlook as
well as Sisecam's credit metrics that could support a rating
upgrade in the next 12 to 18 months.
KEY RATING DRIVERS
Credit Enhancements Support FC Rating: Fitch estimates that the
company has credit enhancements in place, including offshore
operating EBITDA, Turkish export EBITDA (adjusted down by 50%) and
readily available liquidity offshore, sufficient to meet HC debt
service cover of above 1x over the forecast period. This allows
Sisecam's FC IDR to be one notch above Turkiye's CC.
Fitch estimates the US and EU-originated EBITDA to largely cover
the (post-refinancing) interest expense born from euro- and
US-dollar denominated borrowings.
Strong Revenue Growth: Fitch expects Sisecam to maintain
double-digit revenue growth (in LC) of 22% in 2024 and 24% in 2025,
supported by strong international sales of architectural glass,
glassware, glass packaging and chemicals. The company generated 40%
of revenue from its international businesses in 2023, while 60% of
revenue came from exports from Turkiye and domestic businesses.
Diversified Business Profile: Sisecam's diversified business
profile includes both cyclical and defensive sectors. Chemicals and
architectural glass were the top contributors to revenue and EBITDA
in 2023, at 40% and 20%, respectively, although the company saw
robust volume and sales growth across all segments, producing 5.2
million tons of glass despite inflationary pressure. Its 45
production facilities across 14 countries help diversify its
distribution network and maintain a competitive edge among regional
peers.
The company expanded its footprint via investments in soda
chemicals in the US and industrial glass in Hungary. The chemicals
segment, which produces soda ash and other raw materials used in
glass production, help Sisecam control costs along the glass
production value chain.
Resilient EBITDA Margin: Fitch expects the EBITDA margin to remain
resilient at above 20% through to 2027, despite pressure on energy
and raw material costs, as Sisecam should be able to pass on higher
costs to end-customers. Architectural glass, glassware, glass
packaging and chemicals are the highest contributors to energy
costs. The company produced its own electricity in 2023 through
licensed plants; these produced 30% of its total energy needs
globally and 62% in Turkiye.
Negative FCF: Fitch forecasts the capex intensity ratio to spike
towards 20% of sales in 2024-2025, from 14% in 2023, as the company
drives its investment cycle in architectural glass, glass packaging
and chemicals. This is likely to keep FCF negative till 2027,
although Sisecam's liquidity position should be supported by a
conservative dividend payout policy and conservative leverage
thresholds.
Fitch estimates that 25% of upcoming capex will be geared towards
maintenance of furnaces and cold repairs, while 75% will be for
expansion. Sisecam's multi-tier international investment plan,
which aims to maintain desired product quality and retain its
cross-sector market share, amounts to USD250 million.
Refinancing Supports Financial Profile: The proposed US-dollar bond
issue will be used to partially refinance Sisecam's existing bond
and short-term debt as well as to boost HC cash balance. The
issuance should improve the diversification of funding, reduce the
average cost of debt and reduce reliance on short-term borrowings
which nevertheless remains a constraint. The company expects to
boost its offshore HC denominated cash for future HC debt service.
Fitch expects the terms of the notes to include leverage covenants
that may support its view of insulated legal ring-fencing around
Sisecam. Fitch also views access and control factors, including
partial public listing of Sisecam and its independent external
funding as porous. Sisecam is 51% owned by Turkiye Is Bankasi A.S.
(B/Positive) and its current assessment of the Parent and
Subsidiary Links (PSL) allows Sisecam's ratings two notches above
the parent.
Conservative Capital Structure: Fitch expects Sisecam's credit
metrics to remain strong for its rating, namely average EBITDA net
leverage of 2.1x over the medium term, which could support an
upgrade, especially once Fitch assesses that FCF is turning
positive. EBITDA interest coverage and FX risk exposure are likely
to remain rating constraints.
DERIVATION SUMMARY
Sisecam has a strong financial profile, which is comparable with
that of higher-rated peers, such as Owens Corning (BBB/Stable), and
is significantly better than that of lower-rated peers, such as
Hestiafloor 2 (B/Stable). Fitch expects Sisecam FFO net leverage to
reach 2.4x in 2024 and 2.2x in 2025 and forecast net EBITDA
leverage of 2.7x and 2.3x, respectively. This compares well with
its forecast for Owen Corning's FFO net leverage of 2.5x and 2.0x
and net EBITDA leverage of 2.1x and 1.7x.
Sisecam has an above-peer FFO margin due to its low cost base and
leading position in its core markets. It recorded an FFO margin of
15% in 2023, which was slightly lower than Owen Corning's 18%, but
significantly higher than its estimate of Arcelik A.S.'s
(BB/Positive) FFO margin of 11% at end-2023. Fitch believes Sisecam
has healthy geographical diversification and exposure to several
industries, including construction, auto and healthcare, but it
remains smaller than Owen Corning, Arcelik and Ardagh Group S.A.
(B-/Negative).
KEY ASSUMPTIONS
- Double-digit revenue growth for the next four years across
Turkiye and overseas, supported by added capacity, repricing,
improving market conditions and a favourable FC impact on sales
- Successful eurobond issue of USD1 billion and partial repayment
of existing bonds and short-term loans
- A stronger EBITDA margin from 2024 amid dynamic repricing,
improved product mix and lower energy prices
- Higher capex for greenfield and brownfield projects
- Dividend distribution to increase with profitability
RATING SENSITIVITIES
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade:
- Sustained net EBITDA leverage below 3.0x, FFO net leverage below
3.5x, EBITDA interest coverage above 5.0x and positive FCF margin
would support LC IDR upgrade assuming no PSL constraint from the
parent
- FC IDR would follow the LC IDR upgrade if Turkiye's CC is also
upgraded or Sisecam's credit enhancements strengthen
Factors that Could, Individually or Collectively, Lead to
Downgrade:
- Net EBITDA leverage above 4.0x, FFO net leverage above 4.5x and
EBITDA interest coverage below 4.0x
- Substantial deterioration in liquidity and a consistently
negative FCF margin
- Weakening in the business profile along with loss of market share
and pricing power
- Tighter links with the parent or (for FC IDR) weaker credit
enhancements
LIQUIDITY AND DEBT STRUCTURE
Tight Liquidity: Fitch expects Sisecam's liquidity score to remain
below 1x after the proposed bond transaction. The proposed issuance
should improve the company's debt maturity profile and reduce
reliance on short-term borrowings, which comprise around 46% of
total debt. Fitch expects the continued roll-out of short-term bank
funding. Around 82% of debt is denominated in HC. Fitch believes
uncommitted bank lines of approximately USD500 million with Turkish
banks would remain available in a stress scenario, particularly as
Sisecam is a multinational conglomerate with strong banking
relationships.
ISSUER PROFILE
Sisecam is a Turkish-based multinational industrial corporation
with manufacturing operations in 14 countries. It is one of the
world's top-two glassware producers and among the top-five
producers in glass packaging and flat glass. It is also the
second-largest soda ash producer and a world leader in chromium
chemicals.
PUBLIC RATINGS WITH CREDIT LINKAGE TO OTHER RATINGS
The ratings on Sisecam are linked to the Country Ceiling on
Turkiye.
ESG CONSIDERATIONS
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
----------- ------ -------- -----
Turkiye Sise
ve Cam
Fabrikalari AS LT IDR BB- Upgrade B+
LC LT IDR BB- New Rating
senior
unsecured LT BB- Upgrade RR4 B+
Sisecam UK plc
senior
unsecured LT BB-(EXP)Expected Rating RR4
===========================
U N I T E D K I N G D O M
===========================
ATLAS: Goes Into Administration After Worcester Takeover
--------------------------------------------------------
Anna Cooper at TheBusinessDesk.com reports that Worcester Warriors'
new owners have fallen into administration, just over a year after
the firm took over the rugby club.
Jim O'Toole and James Sandford's Atlas consortium were appointed as
Warrior's new owners in February 2023 by administrators at Begbies
Traynor, TheBusinessDesk.com relates. The pair have since departed
as Wasp's owner Chris Holland became a majority shareholder in
Atlas last September, TheBusinessDesk.com notes.
Mr. Holland and his company Loxwood Holdings is reportedly a 97%
shareholder in Atlas as well as owning Wasps which he was a
director at before it also fell into administration,
TheBusinessDesk.com states.
TheBusinessDesk.com can reveal that administrators have been
appointed at Atlas and understand that an announcement will be made
regarding the fate of the company and club.
According to TheBusinessDesk.com, Atlas still owed GBP1.2 million
to administrators at Begbies Traynor last November, as part of its
deferred consideration for the club.
Worcester Warriors' Sixways stadium and the surrounding land were
sold to Atlas for GBP2.05 million in February 2023,
TheBusinessDesk.com recounts. A non-refundable deposit of
GBP500,000 was paid on February 1 and the consortium then agreed to
pay a deferred consideration of GBP1 million over a two-year
period, TheBusinessDesk.com relays.
Instead, the date was brought forward to Oct. 9, but Atlas missed
this deadline, TheBusinessDesk.com states.
The 43-page progress report also revealed that the club owed GBP24
million to unsecured creditors when it went under,
TheBusinessDesk.com notes.
Begbies Traynor, as cited by TheBusinessDesk.com, said there was a
lack of funds available to repay these unsecured creditors, which
include the likes of banks, ticket and season ticket holders, trade
creditors and directors.
BELLIS FINCO: Fitch Affirms B+ LongTerm IDR, Alters Outlook to Pos.
-------------------------------------------------------------------
Fitch Ratings has revised the Outlook on Bellis Finco plc's (ASDA)
Long-Term Issuer Default Rating (IDR) to Positive from Stable and
affirmed the IDR at 'B+'. Fitch has also assigned Bellis
Acquisition Company Plc's new planned senior secured debt an
expected rating of 'BB(EXP)'/'RR2', which is aligned with its
existing senior secured debt. Final ratings are subject to
completion and documentation.
The revision of the Outlook to Positive reflects ASDA's progress in
improving its non-fuel gross profit margin and effectively
controlling operating costs in 2023, which combined with profits
added from the inclusion of the acquired EG operations, support
good prospective cash flow generation over the rating horizon and
means there is a good likelihood of deleveraging below 5.0x by
2025. Fitch also assumes a smooth refinancing of the majority of
senior secured debt maturing in February 2026 12-15 months before
its maturity. Fitch continues to view the company's credit profile
in the context of execution risk on achieving profit growth in a
competitive environment, integrating acquired businesses and
delivering synergies, but believe this is more manageable.
The planned new term loans B (TLB) will rank pari passu with ASDA's
existing senior secured debt. Fitch expects all proceeds to be
applied to repay existing debt, in addition to around GBP340
million repayment from cash on balance sheet. Debt reduction from
cash on its own improves EBITDAR leverage in 2024, but the positive
impact is offset by its review of the treatment of the Walmart
instrument as debt because its redemption date in 2028 will be
ahead of the maturity date for new refinanced debt.
KEY RATING DRIVERS
Progress Addressing Refinancing Risk: The proposed transaction aims
to raise GBP900 million equivalent of seven-year TLB to part
refinance GBP3.66 billion existing term debt mostly maturing in
February 2026. The planned GBP340 million debt reduction from cash
(net of GBP75 million transaction costs) has a positive impact on
leverage metrics but is offset by its changed treatment of the
Walmart instrument. After raising TLB, extending TLA and debt
repayment from cash, this will leave GBP2,250 million senior
secured notes due in 2026, majority of which Fitch expects to be
refinanced 12-15 months ahead of their February 2026 maturities.
Fitch models rising interest costs of near GBP390 million in 2025.
The transaction also envisages an extension to 2028 for the term
loan A (TLA; GBP166 million currently outstanding), which is
subject to the remaining unrefinanced debt due in 2026 not
exceeding GBP500 million upon closing of the whole refinancing
(including refinancing of remaining senior secured notes).
New TLB Mature After Second-lien: The proposed new TLB will mature
in 2031, after the second-lien debt (GBP500 million 4% notes) due
in February 2027 and the GBP684 million private placement with
Apollo (due in October 2029). ASDA could repay the second-lien debt
from cash, but the 2028 Walmart instrument, in its view, may imply
the need to refinance the whole capital structure in 2027.
A GBP667 million revolving credit facility (RCF), to be extended to
October 2028, benefits from springing maturity ahead of the
existing second-lien notes if more than GBP350 million is still
outstanding in October 2026. Its maturity also springs ahead of the
current senior secured notes and TLB if there is more than GBP500
million outstanding by October 2025.
Slightly Revised Forecast: Its overall EBITDA (post rents) forecast
in 2024 is around GBP80 million higher at GBP1.25 billion than
previously projected. This incorporates slightly lower growth with
a higher gross margin for ASDA's standalone non-fuel business and
continuously well-controlled operating costs, along with higher
fuel margins across the whole group than assumed previously. Fitch
continues assuming a yoy lower fuel margin for acquired businesses
that remains above ASDA's standalone non-fuel business. Tweaks to
the forecast follow ASDA reporting progress on improving non-fuel
gross profit margin and well controlled operating costs in 2023.
Profit Growth Execution Risk: Fitch sees some remaining execution
risk in achieving continued sales growth, given some loss of
customers to competitors in 2023 and the UK food retail market
remaining competitive. Fitch assumes profit growth from improving
gross profit margin in ASDA standalone business along with
controlled operating cost base and delivery of GBP90 million
synergies. Its forecast incorporates near GBP300 million EBITDA
uplift (on proforma basis) between 2023 and 2025 which supports
deleveraging to below 5.0x EBITDAR in 2025.
Walmart Instrument Treated as Debt: Fitch now treats the original
GBP500 million Walmart PIK instrument as debt because its maturity
will be ahead of the senior secured debt under the new capital
structure. Fitch previously treated Walmart PIK instrument as
equity because this instrument is deeply subordinated and has an
effective redemption date in February 2028 after the debt
maturities under existing capital structure. Walmart's senior
shares accrue payment in kind interest.
Deleveraging Potential: Fitch believes ASDA has the potential to
deleverage due to its cash generation capabilities, although there
has been limited gross debt reduction since the LBO in 2021. ASDA
envisages reducing its debt by GBP340 million from cash as part of
the refinancing exercise. This follows limited TLA amortisation and
repayment of GBP200 million bridge facility (used to fund its
acquisition of Co-Op stores). Fitch expects deleveraging towards
5.0x by 2024 to come from EBITDA growth rather than further
voluntary debt repayments.
Positive FCF; Improving from 2025: Fitch expects free cash flow
(FCF) generation to remain positive over the rating horizon but
suppressed in 2024 due to the final costs associated with IT
restructuring linked to Project Future. At around GBP290 million,
these are now around GBP130m higher than previously expected. As
this project completes, Fitch expects stronger cash generation that
will be partly absorbed by higher interest cost, taxes and capex,
with the margin reverting to slightly above 1% of sales from 2025.
ASDA delivered stronger than expected FCF in 2023 due to better
funds from operations (FFO), lower capex and stronger working
capital management, which remains management's focus. Fitch
reflects this in its expectation of overall GBP400 million inflow
over 2024-2026 (vs. GBP150 million previously) from working capital
movements.
Larger Business Scale: ASDA has grown to be a larger-scale and more
diversified business following the acquisitions. Fitch forecasts
2025 EBITDAR will exceed GBP1.7 billion, which maps to a 'bbb'
category score for scale under its Food Retail Navigator.
Resilient Food Retail Demand: ASDA has a strong business model in a
resilient but competitive UK food retail sector. It has a good
brand and has stabilised its market share due to its focus on value
and investment in price. ASDA holds the number-two position in
online grocery sales in the UK, accounting for around 18% of its
grocery sales in 2023.
DERIVATION SUMMARY
Fitch rates ASDA using its global Food Retail Navigator. The
acquisition of EG Group's UK and Ireland operations increased
ASDA's scale, broadened its diversification and improved its market
position, although it is still weaker than that of other large food
retailers in Europe, such as Tesco plc (BBB-/Stable) and Ahold
Delhaize NV.
Fitch views ASDA's and Market Holdco 3 Limited's (Morrisons;
B/Positive) business profiles as broadly comparable. However, the
EG business acquisition enhanced ASDA's scale, increased
diversification and recent lfl sales growth puts its business
profile slightly ahead of Morrisons. Both Morrisons and ASDA's
operations remain focused in the UK.
ASDA has larger scale, stronger diversification and a larger market
share than Morrisons, but the latter has stronger vertical
integration that supports profitability and a higher portion of
freehold assets. ASDA's recovery in lfl sales underlined some
competitive advantage when consumers trade down, while the market
remains very competitive and ASDA lost market share in 2023, albeit
its market share has been more stable since May 2023. The growing
convenience channel presents execution risk for both companies.
ASDA benefits from a stronger online market share than Morrisons.
Fitch expects around 1.0x difference in EBITDAR leverage between
ASDA (5.0x) and Morrisons (6.0x) by 2025. This is meaningfully
higher than Tesco's (around 3.5x excluding Tesco Bank), while more
comparable with its projection for smaller-scale WD FF Limited's
(B/Stable) leverage at slightly above 6.0x by end March 2026.
KEY ASSUMPTIONS
Fitch's Key Assumptions within its Rating Case for the Issuer
- ASDA's standalone revenue to be slightly lower in 2024; driven by
growth in ex-petrol revenue (+2%) that is more than offset by a
decline in petrol revenue (-14% decline in volume vs 2023). Revenue
to grow on average around 2% onwards driven by ex-petrol revenue
growth that is partly offset by incrementally slowly declining fuel
volumes.
- Acquired ex EG Group UK standalone revenue estimated at around
GBP2.7 billion (2024) to grow slightly (average +1.5% p.a.) during
2025-2026. Fitch expects growth in grocery revenues due to
completed store conversions to the "ASDA Express" format and in the
foodservice segment. Fitch expects growth in fuel volumes as prices
are slightly lowered in 2024, followed by incremental slow decline
in fuel volumes. At the gross profit level this is compensated by
incremental increase in the pence per litre margin.
- Arthur revenues estimated at near GBP900 million per year over
the forecast horizon driven by grocery sales from store conversions
to "ASDA Express", offset by a decline in fuel revenue due to
gradual volume decline and a reduction in petrol retail prices post
acquisition. Fitch expects pump prices and gross profit margin at
ex EG sites and Arthur sites to remain above ASDA legacy sites.
- Combined revenue to grow on average by nearly 2% in 2025-2026
from GBP27.6 billion in 2024
- EBITDA margin to improve from 3.7% in 2023 to 5.3% in 2026,
mainly driven by growth of core business, non-fuel gross profit
margin improvement for core ASDA business, while maintaining well
controlled SG&A base, along with delivery of around GBP80 million
synergies.
- Annual working-capital inflow of about GBP200 million in 2024 and
GB100 million per year in 2025-2026, driven by focus on working
capital management with improvement to come mainly from payable day
improvements and due to better inventory management
- Average capex of about GBP540 million per year in 2024-2026, on
the back of notably larger operation, larger growth capex and capex
to drive synergies.
- Exceptional costs of around GBP300 million in 2024; GBP270
million in 2024 relate to separating ASDA's IT systems (Project
Future) from its previous owner Walmart with completion by
end-2024.
- Fitch has assumed net repayment of debt of GBP360 million in
2024, driven by the refinancing of GBP3.675 billion of 2025 and
2026 maturities (TLA, TLB, and senior secured notes).
- Fitch treats Walmart PIK instrument (GBP500 million original
amount), as debt under the new capital structure
- No dividends or major M&A activities over the next four years.
RECOVERY ANALYSIS
Fitch's Key Recovery Rating Assumptions:
Under its bespoke recovery analysis, higher recoveries would be
realised through reorganisation as a going-concern in bankruptcy
rather than liquidation. Fitch has assumed a 10% administrative
claim.
The going-concern EBITDA estimate of GBP825 million reflects
Fitch's view of the a sustainable, post-reorganisation EBITDA, upon
which Fitch bases the enterprise valuation (EV). The assumption
also reflects corrective measures taken in the reorganisation to
offset the adverse conditions that trigger its default, such as
cost-cutting efforts or a material business repositioning.
Fitch applies an EV multiple of 6.0x to the going-concern EBITDA to
calculate a post-reorganisation EV. This multiple is aligned with
Morrisons.
Asda's GBP667 million RCF is assumed to be fully drawn upon
default. The RCF ranks pari-passu with the company's GBP4,340
million senior secured debt (currently), comprising of term loans,
senior secured notes and private placement, in the debt waterfall.
However, Fitch has treated as super senior the ground rent of
GBP400 million, which is secured by specific fixed assets and is
not available to the company's cash-flow backed lenders in debt
recovery.
Its waterfall analysis generated a ranked recovery for the senior
secured notes, term loans and private placement facility in the
'RR2' band, indicating a 'BB' instrument rating, two notches higher
than the IDR. The waterfall analysis output percentage on current
metrics and assumptions is 81% (unchanged). The senior secured
second lien debt (GBP500 million) is rated in the 'RR6' band with
an instrument rating of 'B-', two notches below the IDR with a zero
output percentage.
Under the new structure, the ranked recovery for the senior secured
debt remains in the 'RR2' band, indicating a 'BB(EXP)' instrument
rating for the new TLB, two notches above the IDR. The waterfall
analysis output percentage on expected metrics and assumptions is
higher at 87% thanks to reduction in senior secured debt from cash
as part of refinancing. The second-lien debt is rated in the 'RR6'
band with an instrument rating of 'B-', two notches below the IDR
with a zero-output percentage (and this would be unchanged). The
Walmart instrument is subordinated and therefore does not impact
the senior secured instrument recoveries.
RATING SENSITIVITIES
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade:
- Continued lfl sales growth along with improvement in gross
margin, successful integration of acquired businesses and delivery
of synergies, plus cost savings to offset operational cost
inflation, leading to growth in EBITDAR and FCF (over 1%)
- EBITDAR gross leverage below 5.0x on a sustained basis
- EBITDAR fixed charge cover above 2.0x on a sustained basis
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade:
- Fitch could revise the Outlook to Stable if there was a lack of
progress in growing earnings and improving FCF, with EBITDAR gross
leverage not approaching 5.0x in 2024 as a result and there was a
lack of progress in refinancing.
- Lfl sales decline exceeding other big competitors, inability to
grow profits, failure to integrate and generate synergies from
acquired businesses, Project Future cost overruns leading to
low-to-neutral FCF, and reduced deleveraging capacity
- EBITDAR gross leverage remaining above 6.0x on a sustained basis
- EBITDAR fixed charge cover below 1.7x on a sustained basis
- Failure to address upcoming debt maturities 12-15 months in
advance
LIQUIDITY AND DEBT STRUCTURE
Adequate Liquidity: Liquidity is adequate with around GBP850
million cash on balance sheet (after GBP190 million adjustment for
working-capital seasonality by Fitch) and undrawn RCF of GBP667
million as of December 2023. ASDA repaid the GBP200 million bridge
loan related to the acquisition of Co-Op stores in 4Q23.
With the refinancing transaction, Fitch expects there to be some
reduction in cash in 2024 due to debt repayment from cash, slightly
offset by inflows of working capital. Fitch projects ASDA's cash
balances to then build up over the rating horizon due to positive
FCF generation, more so once significant payments related to IT
separation one-off costs (Project Future) end in 2024. This would
permit debt reduction from cash if the company chooses to do so.
ISSUER PROFILE
ASDA is the third-largest supermarket chain in the UK, with around
a 14% market share operating around 1,200 stores.
ESG CONSIDERATIONS
Bellis Finco plc has an ESG Relevance Score of '4' for Group
Structure due to the complexity of the group structure with a
number of related-party transactions. This has a negative impact on
the credit profile, and is relevant to the rating[s] in conjunction
with other factors.
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
----------- ------ -------- -----
Bellis Finco plc LT IDR B+ Affirmed B+
Senior Secured
2nd Lien LT B- Affirmed RR6 B-
Bellis Acquisition
Company Plc
senior secured LT BB(EXP)Expected Rating RR2
senior secured LT BB Affirmed RR2 BB
EDDY'S FOOD: CJ Lang Acquires Three Stores Following Collapse
-------------------------------------------------------------
Alice Leader at The Grocer reports that CJ Lang has bought three
stores from Eddy's Food Station after the business collapsed into
administration.
Located in Larbert, Greenock and Leuchars, the Scottish Spar
wholesaler revealed it completed the acquisition of the three
stores on April 26, The Grocer relates.
According to The Grocer, the transfer will start immediately, with
existing staff set to be retained, ensuring a "seamless transition
for both employees and customers".
Eddy's Food Station owner Stephen Thompson returned to the sector
after almost 20 years in May 2022.
The convenience chain consisted of four stores, using supply deals
with Costcutter and Iceland, The Grocer discloses.
The Grocer understands, however, that Iceland pulled the plug on
its supply deal with Eddy's Food Station earlier this year, with
the arrangement officially ending in March.
Eddy's Food Station Buckhaven store, which has not been purchased
by CJ Lang, has been marked as "permanently closed" on Google, The
Grocer notes.
EVEREST 2020: Enters Administration, 350 Jobs at Risk
-----------------------------------------------------
Business Sale reports that Everest, one of the largest providers of
double-glazing in the UK, has fallen into administration.
The company, which is owned by Better Capital, has appointed
professional services firm ReSolve as administrator, Business Sale
relates.
The company's collapse comes four years after it was placed into
administration by Better Capital during the COVID-19 pandemic,
having become loss-making, Business Sale notes. The firm was
subsequently saved in a pre-pack deal via a new company called
Everest 2020 Limited, which acquired its operations and order book,
Business Sale recounts.
Everest 2020 Limited has now also fallen into administration,
putting around 350 jobs at risk, Business Sale discloses. ReSolve,
Business Sale says, is now reportedly engaged in efforts to find a
buyer for the company in order to secure its future, with potential
bidders expected to include both industry players and turnaround
investors.
The administration comes with Better Capital owner John Moulton in
the process of winding down his company, Business Sale states.
Everest is one of the company's last remaining assets.
In its most recent accounts at Companies House, for the year ending
May 31, 2022, Everest 2020 Limited reported turnover of GBP51.1
million, compared to GBP46.7 million in its previous accounting
period, but fell to a pre-tax loss of more than GBP1.6 million,
Business Sale relates.
At the time, the company's fixed assets were valued at GBP1.4
million and current assets at GBP14.7 million, Business Sale
states. However, the significant debts that the company owed to
creditors at the time left it with total liabilities of close to
GBP4.8 million, according to Business Sale.
FLAT CAP: Administrators Put Courthouse in Knutsford Up for Sale
----------------------------------------------------------------
Sophie Witts at The Caterer reports that the third hotel in the
Flat Cap hotels portfolio has been put up for sale after the
company fell into administration.
Savills is marketing the freehold of the Courthouse in Knutsford,
Cheshire, for an undisclosed sum, The Caterer notes.
Flat Cap opened the hotel and wedding venue in the Grade II-listed
former Crown Court building in 2017.
However, it closed in January following the appointment of
administrators, The Caterer relates.
The hotel features nine bedrooms spread over three floors, a bar
and restaurant with private dining options, a banquet hall with
capacity for 300 people, and two meeting rooms which can be
converted into double bedrooms, The Caterer discloses.
The site has planning permission to add a further 42 bedrooms and
construct of a rooftop bar, The Caterer states.
According to The Caterer, Tom Cunningham, UK regional director,
hotel capital markets, at Savills Manchester, said: "With current
planning permissions to further enhance its offering, we expect a
good amount of interest moving forward."
When the Courthouse closed in January, a spokesperson for
administrators Begbies Traynor, as cited by The Caterer, said:
"Like many others in the hospitality sector, despite having an
excellent reputation and a strong brand, the business has been
impacted by a combination of factors, including the pandemic,
inflation and the challenging economic environment for consumers."
Flat Cap's two other hotels continue to trade under management of
Condor Hotels while being marketed by administrators, The Caterer
discloses.
JOHN BARNES: Ex-Footballer Faces Director Disqualification
----------------------------------------------------------
The Insolvency Service on April 24 disclosed that former England
and Liverpool footballer John Barnes has been banned as a director
after his company failed to pay tens of thousands of pounds in tax.
Investigations by the Insolvency Service revealed that between 2018
and 2020, the 60-year-old's company, John Barnes Media Limited,
failed to pay more than GBP190,000 in corporation tax and VAT, with
HM Revenue and Customs its only known creditor when it ceased
trading.
Mr. Barnes, whose business address is Park Court, Pyrford Road,
West Byfleet, Surrey, has signed a disqualification undertaking
banning him from being a company director for the next
three-and-a-half years.
Mike Smith, Chief Investigator at the Insolvency Service, said:
"Individuals and businesses not paying the tax they should deprives
the government of the funding it needs to provide vital public
services and investment in areas such as schools, hospitals and
roads.
"John Barnes had a legal duty to ensure his company paid the
correct amount of corporation tax and VAT. Instead, it paid no tax
whatsoever between November 2018 and October 2020, despite
receiving earnings of well over GBP400,000.
"This disqualification should serve as a deterrent to other
directors that if you do not pay your taxes while directing money
elsewhere, you are at risk of being banned."
Mr. Barnes, who earned 79 England caps during a professional
playing career spanning almost two decades, formed John Barnes
Media Limited in September 2012.
The company, of which Barnes was the sole director, described
itself as offering media representation services.
Between November 2018 and October 2020, John Barnes Media's
turnover was GBP441,798.
Nothing was paid to HM Revenue and Customs in tax during that
period, despite the company filing returns showing what the VAT
payments should have been.
The Insolvency Service's investigation showed that John Barnes
Media failed to pay GBP78,839 in corporation tax between August
2018 and January 2020, when the company ceased trading. The
company also failed to pay GBP115,272 in VAT between February 2019
and 2020.
Insolvency Service investigations into Mr. Barnes' conduct as a
director began in September 2023.
The Secretary of State for Business and Trade accepted a
disqualification undertaking from Barnes, and his ban started on
Wednesday, April 24.
It prevents him from being involved in the promotion, formation or
management of a company, without the permission of the court.
John Barnes Media Limited's business address is Park Court, Pyrford
Road, West Byfleet, Surrey. His date of birth is November 7,
1963.
John Barnes Media Limited (company number 08201455)
LONDON CARDS 2: DBRS Gives Prov. CCC Rating to Class F Notes
------------------------------------------------------------
DBRS Ratings Limited assigned provisional credit ratings to the
following classes of notes to be issued by London Cards No. 2 plc
(the Issuer):
-- Class A Notes at AAA (sf)
-- Class B Notes at AA (sf)
-- Class C Notes at A (low) (sf)
-- Class D Notes at BBB (low) (sf)
-- Class E Notes at BB (low) (sf)
-- Class F Notes at CCC (sf)
-- Class X Notes at BB (high) (sf)
Morningstar DBRS does not rate the Class G or the Class Z VFN Notes
also expected to be issued in this transaction.
The Class A, Class B, Class C, Class D, Class E, Class F, Class G,
and Class X Notes are collectively referred to as the Notes.
CREDIT RATING RATIONALE
The Notes (excluding the Class X Notes) are backed by a portfolio
of principal receivables under credit card agreements granted by
New Wave Capital Limited, trading as Capital on Tap (CoT or the
originator) to small and medium-size enterprises (SMEs) domiciled
in the United Kingdom of Great Britain and Northern Ireland (UK).
CoT is also the initial servicer with Equiniti Gateway Limited
expected to be in place as the backup servicer at the time of
closing.
The provisional credit ratings are based on a review of the
following analytical considerations:
-- The transaction's capital structure, including form and
sufficiency of available credit enhancement to withstand stressed
cash flow assumptions and repay the Issuer's financial obligations
according to the terms under which the Notes are issued.
-- The credit quality of CoT's portfolio, the characteristics of
the collateral, its historical performance, and Morningstar DBRS'
expectation of charge-offs, monthly principal payment rate (MPPR),
and yield rates under various stress scenarios.
-- CoT's capabilities with respect to originations, underwriting,
and servicing.
-- An operational risk review of CoT, which Morningstar DBRS deems
to be an acceptable servicer.
-- The transaction parties' financial strength regarding their
respective roles.
-- The sovereign rating on the United Kingdom of Great Britain and
Northern Ireland, currently rated AA with a Stable trend by
Morningstar DBRS.
-- The expected consistency of the transaction's legal structure
with Morningstar DBRS' "Legal Criteria for European Structured
Finance Transactions" methodology.
TRANSACTION STRUCTURE
Morningstar DBRS understands that this transaction will be the only
note series intended out of the Issuer, as there are covenants and
restrictions limiting further financial indebtedness such as any
future issuance.
The transaction includes a scheduled [36]-month revolving period.
During this period, additional receivables may be purchased and
transferred to the securitized pool, provided that the eligibility
criteria set out in the transaction documents are satisfied. The
revolving period may end earlier than scheduled if certain events
occur, such as the breach of a performance trigger or servicer
termination. The servicer may extend the scheduled revolving period
by up to 12 months. If the Notes (excluding the Class X Notes) are
not fully redeemed at the end of the scheduled revolving period,
the transaction will enter into an amortization period where the
Notes (except the Class X Notes) will be redeemed sequentially.
The transaction also includes a liquidity reserve that will be
funded by the issuance proceeds of the Class X Notes and will be
replenished to the target amount of 1% of the outstanding Notes
amount (excluding the Class X and Class Z VFN Notes) in the
transaction's interest waterfalls. The reserve is available to the
Issuer to cover the shortfalls in senior expenses; interest
payments on the Class A, Class B, and Class C Notes; and Class A
and Class B loss makeup, and would amortize to the target amount
without a floor.
As the rated Notes carry floating-rate coupons based on the daily
compounded Sterling Overnight Index Average (Sonia), there is an
interest rate mismatch between the fixed-rate collateral and the
Sonia-based floating-rate rated Notes. While the potential risk is
to a certain degree mitigated by the excess spread and the
servicer's ability to increase the credit card contractual rates
during the revolving period, the transaction is exposed to the risk
of further interest rate hikes. Morningstar DBRS considered such
risk and sensitivity to further rapid interest rate hikes in its
analysis.
COUNTERPARTIES
Barclays Bank PLC (Barclays) is the account bank for the
transaction. Based on Morningstar DBRS' Long Term Issuer Rating of
'A' on Barclays and the downgrade provisions outlined in the
transaction documentation, Morningstar DBRS considers the risk
arising from the exposure to the account bank to be commensurate
with the credit ratings assigned.
PORTFOLIO ASSUMPTIONS
The average MPPRs initially started at around 40% in 2017 with a
gradual decline to around 30% until April 2020. Since then, MPPRs
have been increasing quickly reaching a record high of more than
70% in November 2023. A more detailed analysis of borrower payment
behavior indicates an increasing percentage of customers that pay
off the balances in full each month (transactors) since April 2020.
This is consistent with the originator's strategy to focus on the
transactors and the SME nature of this portfolio where the
borrowers tend to pay off the balances more frequently to have the
credit limit available for working capital.
While recent MPPRs continue to be higher than the historical
levels, it remains to be seen if these levels are sustainable in
the current challenging macroeconomic environment of persistent
inflationary pressures and higher interest rates. After considering
historical data and trends, Morningstar DBRS elected to maintain
the expected MPPR at 28% after removing the interest collections
based on the expected transactor and revolver compositions and
respective MPPRs (100% for the transactors).
Portfolio yield includes interest income, fees, and interchange.
Given the corporate nature of the borrowers, the interest rate
charged on the cards varies substantially based on the perceived
credit risk and there is no regulatory constraint in respect of the
maximum rate or interchange on the cards. While the total yield
rates have been relatively stable between 35% and 40%, the
composition of interchange has been increasing due to the pivot on
transactors with a corresponding decline in finance charge yields.
Recognizing the trend and the historical percentages of transactors
and revolvers, Morningstar DBRS maintained the expected portfolio
yield at 35.5% based on the expected transactor and revolver
compositions and respective yields.
The reported charge-offs averaged around 15% until early 2020
before plummeting during the initial COVID-19 pandemic outbreak.
They have since gradually increased but remain below the
pre-pandemic levels in part because of the continued increasing
percentage of transactors in the portfolio. Based on the analysis
of historical trends and percentages of transactors and revolvers,
Morningstar DBRS maintained the expected portfolio charge-off rate
at 14.5% based on the expected transactor and revolver compositions
and respective charge-offs (nil for the transactors).
Morningstar DBRS elected to stress the asset performance
deterioration over a longer period for below investment grade
levels in accordance with the "Rating European Consumer and
Commercial Asset-Backed Securitizations" methodology.
Morningstar DBRS' credit ratings on the Notes addresses the credit
risk associated with the identified financial obligations in
accordance with the relevant transaction documents. The associated
financial obligations are the related interest payment amounts and
the class balances.
Morningstar DBRS' credit rating on the notes also addresses the
credit risk associated with the increased rate of interest
applicable to the notes if the notes are not redeemed on the
initial scheduled redemption date as defined in and in accordance
with the applicable transaction documents.
Morningstar DBRS' credit rating does not address nonpayment risk
associated with contractual payment obligations contemplated in the
applicable transaction document(s) that are not financial
obligations.
Morningstar DBRS' long-term credit ratings provide opinions on risk
of default. Morningstar DBRS considers risk of default to be the
risk that an issuer will fail to satisfy the financial obligations
in accordance with the terms under which a long-term obligation has
been issued.
Notes: All figures are in British pound sterling unless otherwise
noted.
MOLOSSUS BTL 2024-1: Fitch Assigns B-(EXP)sf Rating to Cl. X Notes
------------------------------------------------------------------
Fitch Ratings has assigned Molossus BTL 2024-1 PLC (Molo 2024-1)
expected ratings. The assignment of final ratings is contingent on
the receipt of final documents conforming to information already
reviewed.
Entity/Debt Rating
----------- ------
Molossus BTL
2024-1 PLC
Class A LT AAA(EXP)sf Expected Rating
Class B LT AA(EXP)sf Expected Rating
Class C LT A(EXP)sf Expected Rating
Class D LT BBB(EXP)sf Expected Rating
Class E LT BB+(EXP)sf Expected Rating
Class F LT B+(EXP)sf Expected Rating
Class G LT NR(EXP)sf Expected Rating
Class X LT B-(EXP)sf Expected Rating
Class Z LT NR(EXP)sf Expected Rating
TRANSACTION SUMMARY
Molo 2024-1 is a securitisation of buy-to-let (BTL) mortgages
originated in England and Wales by ColCal Financial UK Limited
(ColCap). ColCap acquired 80% of Molo Finance's shares in February
2023. ColCap is a wholly owned subsidiary of ColCap Financial
Limited, an Australian non-bank mortgage lender.
KEY RATING DRIVERS
Limited Performance Data: The loans within the pool have
characteristics in line with standard UK BTL mortgages. ColCap UK
only started originating BTL mortgages in 2019, under the brand
Molo Finance, and did not have material origination volumes until
2021. The limited history of origination and subsequent performance
data is sufficiently mitigated through available proxy data and
adjustments made to the foreclosure frequency (FF) in Fitch's
analysis.
Newly Originated Asset Pool: Over 98.2% of loans in the provisional
mortgage pool were originated after 2020. The pool has a weighted
average (WA) original loan-to-value (OLTV) of 72.6% and a WA
current LTV (CLTV) of 72.3%, leading to a WA sustainable LTV (sLTV)
of 82.8%. The pool also has a Fitch-calculated WA interest coverage
ratio (ICR) of 81.1%.
Unhedged Basis Risk: The pool includes 2.8% of loans linked to the
Bank of England base rate (BBR). The rest comprise fixed-rate loans
reverting to BBR plus a margin. The fixed-to-floating interest-rate
risk is hedged. Fitch has stressed the transaction cash flows for
basis risk between BBR and SONIA, in line with its UK RMBS Rating
Criteria.
No Product Switches Permitted: No product switches are allowed to
be retained in the pool and, if offered, will be repurchased by the
seller. This mitigates the potential for pool migration towards
lower-yielding assets and the need for additional hedging.
Fixed Hedging Schedule: At closing, the issuer will enter a swap
agreement to mitigate the interest-rate risk arising from the
fixed-rate mortgage loans before their reversion date. The swap is
based on a defined schedule assuming no defaults or prepayments,
rather than on the balance of fixed-rate loans in the pool. If
loans prepay or default, the issuer will be over-hedged. The excess
hedging is beneficial to the issuer in a rising interest-rate
environment and detrimental in a decreasing interest-rate
environment.
RATING SENSITIVITIES
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
Material increases in the frequency of defaults and loss severity
on defaulted receivables producing losses greater than Fitch's
base-case expectations may result in negative rating action on the
notes. Fitch found that a 15% increase in the WAFF, along with a
15% decrease in the WA recovery rate (RR), would lead to downgrades
of up to two notches for the class A, B and C notes and one notch
for the class D, E and F notes.
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
Stable to improved asset performance driven by stable delinquencies
and defaults would lead to increasing credit enhancement and,
potentially, upgrades. Fitch found that a decrease in the WAFF of
15% and an increase in the WARR of 15% would lead to upgrades of up
to three notches for the class D, E and F notes, two notches for
the class C notes and no more than one notch for the class B
notes.
USE OF THIRD PARTY DUE DILIGENCE PURSUANT TO SEC RULE 17G -10
Form ABS Due Diligence-15E was not provided to, or reviewed by,
Fitch in relation to this rating action.
DATA ADEQUACY
Fitch reviewed the results of a third-party assessment conducted on
the asset portfolio information. Fitch noticed a larger number of
errors, when considering the asset portfolio in comparison to that
of recent origination from similar lenders. However, upon reviewing
the report Fitch concluded that there were no findings of a
magnitude sufficient to affect the rating analysis as most errors
were the result of a small difference between the reported value
and the source data.
Fitch conducted a review of a small targeted sample of the
originator's origination files and found the information contained
in the reviewed files to be adequately consistent with the
originator's policies and practices and the other information
provided to the agency about the asset portfolio.
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.
ESG CONSIDERATIONS
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.
NEPTUNE ENERGY: S&P Withdraws 'BB+' Long-Term Issuer Credit Rating
------------------------------------------------------------------
S&P Global Ratings withdrew its 'BB+' long-term issuer credit
rating on Neptune Energy Group Midco Ltd. at the issuer's request.
At the time of the withdrawal, our rating on the company was on
CreditWatch, where we placed it with positive implications on Feb.
12, 2024.
NEWDAY FUNDING 2024-1: DBRS Finalizes BB Rating on Class E Notes
----------------------------------------------------------------
DBRS Ratings Limited finalized provisional credit ratings on the
notes (collectively, the Notes) issued by NewDay Funding Master
Issuer plc (the Issuer) as follows:
-- Series 2024-1, Class A Notes at AAA (sf)
-- Series 2024-1, Class B Notes at AA (sf)
-- Series 2024-1, Class C Notes at A (sf)
-- Series 2024-1, Class D Notes at BBB (sf)
-- Series 2024-1, Class E Notes at BB (sf)
-- Series 2024-1, Class F Notes at B (high) (sf)
The credit ratings address the timely payment of scheduled interest
and the ultimate repayment of principal by the relevant legal final
maturity dates.
The credit ratings are based on the following analytical
considerations:
-- The transaction's structure, including the form and sufficiency
of available credit enhancement to withstand stressed cash flow
assumptions and repay the Issuer's financial obligations according
to the terms under which the Notes are issued.
-- The credit quality of NewDay Ltd.'s portfolio, the
characteristics of the collateral, its historical performance and
Morningstar DBRS' expectation of charge-offs, monthly principal
payment rate (MPPR), and yield rates under various stress
scenarios.
-- NewDay Ltd.'s capabilities with respect to origination,
underwriting, servicing, and its position in the market and
financial strength.
-- An operational risk review of NewDay Cards Ltd., which is
deemed an acceptable servicer.
-- The transaction parties' financial strength regarding their
respective roles.
-- The consistency of the transaction's legal structure with
Morningstar DBRS' methodology "Legal Criteria for European
Structured Finance Transactions".
-- The sovereign rating on United Kingdom of Great Britain and
Northern Ireland, currently rated AA with a Stable trend by
Morningstar DBRS.
TRANSACTION STRUCTURE
The Notes are backed by a portfolio of near-prime credit cards
granted to individuals domiciled in the UK by NewDay and are issued
out of NewDay Funding Master Issuer plc as part of the NewDay
Funding-related master issuance structure under the same
requirements regarding servicing, amortization events, priority of
distributions, and eligible investments.
The transaction includes a scheduled revolving period. During this
period, additional receivables may be purchased and transferred to
the securitized pool, provided that the eligibility criteria set
out in the transaction documents are satisfied. The revolving
period may end earlier than scheduled if certain events occur, such
as the breach of performance triggers or servicer termination. The
servicer may extend the scheduled revolving period by up to 12
months. If the Notes are not fully redeemed at the end of the
respective scheduled revolving periods, the transaction enters into
a rapid amortization.
The transaction also includes a series-specific liquidity reserve
to cover shortfalls in senior expenses, senior swap payments (if
applicable) and interest on the Class A, Class B, Class C and Class
D Notes and would amortize to the target amount, subject to a floor
of GBP 250,000.
As the Notes are denominated in GBP with floating-rate coupons
based on the daily compounded Sterling Overnight Index Average
(Sonia), there is an interest rate mismatch between the fixed-rate
collateral and the Sonia coupon rates. The potential risk is to a
certain degree mitigated by excess spread and NewDay's ability to
increase the credit card annual percentage rates. The A (sf) rated
Class C Notes benefit from higher subordination than the other A
(low) (sf) rated notes issued separately out of the NewDay Funding
related master issuance programme. This approach is consistent with
the issuance of the Series 2023-1 and with Morningstar DBRS'
criteria in respect of the rating stability of a master issuance
structure.
COUNTERPARTIES
HSBC Bank plc is the account bank for the transaction. Based on
Morningstar DBRS' private rating on HSBC Bank plc and the downgrade
provisions outlined in the transaction documents, Morningstar DBRS
considers the risk arising from the exposure to the account bank to
be commensurate with the credit ratings assigned.
PORTFOLIO ASSUMPTIONS
Recent total payment rates including the interest collections
declined slightly with a total payment rate of 14.9% in January
2024 following a record high of 15.7% in May 2023 but continued to
remain above historical levels. While the recent levels do not
appear to be susceptible to the current inflationary pressures and
interest rates, Morningstar DBRS elected to maintain the expected
MPPR at 8% after removing the interest collections.
The portfolio yield was largely stable over the reported period
until March 2020, the initial outbreak of the COVID-19 pandemic.
The most recent performance in January 2024 showed a total yield of
33%, up from the record low of 26% in May 2020 as a result of the
consistent repricing of credit card rates by NewDay following the
Bank of England base rate increases since mid-2022. After
consideration of the observed trends and the removal of
spend-related fees, Morningstar DBRS maintained the expected yield
at 27%.
The reported historical annualized charge-off rates were high but
stable at around 16% until June 2020. The most recent performance
in January 2024 showed a charge-off rate of 11.5% after reaching a
record high of 17.6% in April 2020. Based on the analysis of
historical charge-off rates, delinquencies and consideration of the
current macroeconomic environment, Morningstar DBRS maintained the
expected charge-off rate at 18%.
Morningstar DBRS' credit ratings on the Notes address the credit
risk associated with the identified financial obligations in
accordance with the relevant transaction documents. The associated
financial obligations for each of the Notes are the related
Interest Payment Amounts and the Class Balances.
Morningstar DBRS' credit rating on the Notes also addresses the
credit risk associated with the increased rate of interest
applicable to the Notes if the Notes are not redeemed on the
initial scheduled redemption date as defined in and in accordance
with the applicable transaction documents.
Morningstar DBRS' credit ratings do not address nonpayment risk
associated with contractual payment obligations contemplated in the
applicable transaction document(s) that are not financial
obligations.
Morningstar DBRS' long-term credit ratings provide opinions on risk
of default. Morningstar DBRS considers risk of default to be the
risk that an issuer will fail to satisfy the financial obligations
in accordance with the terms under which a long-term obligation has
been issued.
Notes: All figures are in British pound sterling unless otherwise
noted.
SELINA HOSPITALITY: Receives NASDAQ Delisting Notice, Seeks Hearing
-------------------------------------------------------------------
Selina Hospitality PLC disclosed that the Company received a staff
determination letter from the Listing Qualifications Department of
The Nasdaq Stock Market LLC notifying the Company of the staff's
intention to commence the process to delist the Company's
securities because the Company's securities have had a closing bid
price below $0.10 for ten consecutive trading days prior to April
17, 2024, which triggers a notice of delisting pursuant to Nasdaq
Listing Rule 5810(c)(3)(A)(iii) (the "Low Priced Stocks Rule").
In addition to the Letter, as previously disclosed, the Company has
been on notice since September 8, 2023 that the closing bid price
of its securities had fallen below $1.00 for 30 consecutive
business days in violation of Nasdaq Listing Rule 5810(c)(3)(A)
(the "Minimum Bid Price Rule") and since such date the Company has
not regained compliance. On March 7, 2024, following the transfer
of the Company's securities to the Nasdaq Capital Market, the
Company was granted an additional 180 calendar day period, or until
September 3, 2024, to regain compliance with the Minimum Bid Price
Rule. If the Company's securities fail to regain compliance with
the Minimum Bid Price Rule before such date, Nasdaq will have an
additional basis for delisting the Company's securities.
The Company currently plans to appeal the staff's determination to
a Hearings Panel. A hearing request will stay the suspension of the
Company's securities and the filing of the Form 25-NSE pending the
Panel's decision. This hearing has yet to be scheduled, but once
the Company's request for a hearing has been submitted to Nasdaq,
the hearing is expected to be held within the next 45 days.
The Company intends to monitor the closing bid price of its common
stock and may consider implementing available options to regain
compliance with the Minimum Bid Price Rule for continued listing on
the Nasdaq Capital Market, if needed. Achieving compliance likely
would involve the implementation of the 1:30 reverse stock split
that was approved by shareholders at the Company's general
shareholder meeting on March 26, 2024.
About Selina Hospitality PLC
United Kingdom-based Selina (NASDAQ: SLNA) is one of the world's
largest hospitality brands built to address the needs of millennial
and Gen Z travelers, blending beautifully designed accommodation
with coworking, recreation, wellness, and local experiences.
Founded in 2014 and custom-built for today's nomadic traveler,
Selina provides guests with a global infrastructure to seamlessly
travel and work abroad. Each Selina property is designed in
partnership with local artists, creators, and tastemakers,
breathing new life into existing buildings in interesting locations
in 24 countries on six continents -- from urban cities to remote
beaches and jungles.
THAMES WATER: Ofwat Mulls Break-up Under Project Telford
--------------------------------------------------------
Luke Barr and Ben Marlow at The Telegraph report that the water
regulator is working on rescue plans for Thames Water that could
see its sprawling operations dismantled and sold off as piecemeal
to rival suppliers.
Codenamed Project Telford, Ofwat has tasked a former private equity
banker with overseeing its contingency plan for the utility giant,
which is battling to stave off collapse under the weight of an
GBP18 billion debt pile, The Telegraph relates.
According to The Telegraph, one of the scenarios under
consideration by the watchdog is a radical break-up of Thames,
which is Britain's biggest utility company that provides water and
sewage services to 16 million households.
Adrian Williams, formerly of HSBC and Bridgepoint, has been drafted
in to supervise Ofwat's emergency backstop, which is separate from
the Government's own contingency proposal Project Timber, The
Telegraph discloses.
Filings show that Ofwat has paid around GBP150,000 in consultancy
fees to a company owned by Mr. Williams, The Telegraph notes.
Among a range of scenarios being explored by Ofwat is an even more
radical break-up of Thames Water than had previously been
envisaged, The Telegraph states.
According to The Telegraph, a senior industry source with knowledge
of the plans said Thames could end up being split up into as many
as "a dozen" smaller companies. "There is no limit to the number
it can be broken up into," the person said.
This comes after The Telegraph revealed earlier this month that
bosses at Thames are considering dividing the business into two
separate smaller entities, one covering London and the other
serving Thames Valley and Home Countries regions.
The prospect of a broader carve-up has sparked interest from rival
suppliers, who are now understood to be circling the company, The
Telegraph relays.
The source added that Thames could be carved up in such a way as to
encourage other companies, such as Severn Trent and Wessex Water,
to compete in a bidding war to maximise value, The Telegraph
notes.
This would require a complex separation of Thames Water's debt
pile, although policymakers are confident this hurdle could be
overcome, according to The Telegraph.
A break-up is seen as a favourable outcome among senior officials
because it could prevent the Government from having to step in and
take temporary ownership through the Special Administration regime,
The Telegraph says.
Even a short-lived bailout would result in the taxpayer being
landed with a bill running into billions of pounds, it is feared,
as was the case with Bulb Energy before it was rescued by rival
Octopus, The Telegraph notes.
Details of fresh contingency plans follow revelations in The
Telegraph that the company hopes to pay out GBP2 billion in
dividends over the next decade despite growing fears over its
collapse.
Britain's biggest water supplier has been plunged into crisis after
its investors refused to pump in crucial funds that would have
helped to finance network improvements, The Telegraph recounts.
This came to a head last month when shareholders described the
company as "uninvestable" and rowed back on a pledge to provide a
GBP500 million emergency lifeline, The Telegraph relays
The strain on Thames's finances was laid bare in a revised plan
submitted to Ofwat last week, which revealed that the annual
interest bill on its borrowings is set to surge to around GBP3
billion by 2030, The Telegraph discloses.
This is almost as much as the GBP3.3 billion that shareholders,
including sovereign wealth funds from Abu Dhabi and China, were
planning to invest in the company before they pulled the plug on
funding, The Telegraph notes.
Thames is saddled with debts totalling GBP18 billion and faces
running out of money before the middle of next year, The Telegraph
discloses.
Separately, a consortium of creditors has called for an urgent
meeting with Thames Water bosses and representatives at Rothschild
following reports that they face steep losses under one financial
restructuring proposal being discussed, The Telegraph notes.
According to The Telegraph, in a letter sent by lawyers at the
American firm Akin Gump, the group of bondholders claimed to be
"the largest coordinated group of operating company creditors" to
have emerged. "We act for creditors holding debt . . . in excess of
GBP5 billion," it said.
"It is no longer appropriate . . . for the only communication . .
. to be by way of periodic investor calls or written questions
submitted to the group's investor relations employees," the letter
continued.
[*] UK: Company Insolvencies Down 2% in First Quarter 2024
----------------------------------------------------------
Tom Rees at Bloomberg News reports that the number of English and
Welsh companies going bust stabilized in the first quarter after
hitting a three-decade high in 2023 following a hit to balance
sheets from soaring energy bills and interest rates.
According to Bloomberg News, company insolvencies in England and
Wales fell 2% from a year ago to 5,759 in the first three months of
the year, according to the government's Insolvency Service. It was
down 12% on the previous quarter, Bloomberg News notes.
The figures add to hopes that a rapid exit from the last year's
recession may strengthen companies that are now on the brink and
prevent a repeat of last year's jump to the highest level of
insolvencies since 1993, Bloomberg News states.
Falling inflation, the economy's recovery and the prospect of
cooling interest rates may begin to ease the pressure on UK
companies in 2024, Bloomberg News relays.
However, it still leaves bankruptcies well above pre-pandemic
levels with experts warning of more pain ahead for firms as many
are forced to refinance their borrowings at high borrowing costs,
according to Bloomberg News.
Figures covering February, the latest available data, showed
construction, retail and hospitality firms continued to bear the
brunt of the bankruptcies, Bloomberg News discloses.
===============
X X X X X X X X
===============
[*] BOND PRICING: For the Week April 22 to April 26, 2024
---------------------------------------------------------
Issuer Coupon Maturity Currency Price
------ ------ -------- -------- -----
Altice France Holding 10.500 5/15/2027 USD 38.097
Altice France Holding 10.500 5/15/2027 USD 37.295
Codere Finance 2 Luxe 11.000 9/30/2026 EUR 33.763
Solocal Group 10.940 3/15/2025 EUR 18.504
Codere Finance 2 Luxe 12.75011/30/2027 EUR 2.000
Caybon Holding AB 10.566 3/3/2025 SEK 46.350
Kvalitena AB publ 10.067 4/2/2024 SEK 45.000
Tinkoff Bank JSC Via 11.002 USD 42.911
IOG Plc 13.428 9/20/2024 EUR 10.000
Codere Finance 2 Luxe 13.62511/30/2027 USD 1.000
Saderea DAC 12.50011/30/2026 USD 47.609
YA Holding AB 12.75812/17/2024 SEK 14.600
R-Logitech Finance SA 10.250 9/26/2027 EUR 15.644
Codere Finance 2 Luxe 13.62511/30/2027 USD 1.000
UkrLandFarming PLC 10.875 3/26/2018 USD 4.100
Bakkegruppen AS 11.700 2/3/2025 NOK 45.583
Solocal Group 10.940 3/15/2025 EUR 8.275
Codere Finance 2 Luxe 11.000 9/30/2026 EUR 33.763
Ilija Batljan Invest 10.768 SEK 4.000
Transcapitalbank JSC 10.000 USD 1.450
Oscar Properties Hold 11.270 7/5/2024 SEK 3.336
Privatbank CJSC Via U 10.875 2/28/2018 USD 4.689
Privatbank CJSC Via U 10.250 1/23/2018 USD 3.536
Bourbon Corp SA 11.652 EUR 1.377
Offentliga Hus I Nord 10.871 SEK 44.108
Immigon Portfolioabba 10.258 EUR 9.560
Avangardco Investment 10.00010/29/2018 USD 0.108
Plusplus Capital Fina 11.000 7/29/2026 EUR 10.563
Bilt Paper BV 10.360 USD 1.636
Virgolino de Oliveira 11.750 2/9/2022 USD 0.611
Marginalen Bank Banka 13.068 SEK 45.000
Virgolino de Oliveira 10.500 1/28/2018 USD 0.010
Virgolino de Oliveira 10.500 1/28/2018 USD 0.010
Sidetur Finance BV 10.000 4/20/2016 USD 0.219
Goldman Sachs Interna 16.288 3/17/2027 USD 29.770
Privatbank CJSC Via U 11.000 2/9/2021 USD 1.000
Bulgaria Steel Financ 12.000 5/4/2013 EUR 0.216
Phosphorus Holdco PLC 10.000 4/1/2019 GBP 0.789
Societe Generale SA 24.000 11/8/2024 USD 49.500
Societe Generale SA 16.000 8/1/2024 USD 30.600
Societe Generale SA 21.00012/26/2025 USD 28.800
Codere Finance 2 Luxe 12.75011/30/2027 EUR 2.000
Bilt Paper BV 10.360 USD 1.636
Societe Generale SA 10.010 8/29/2024 USD 47.400
Societe Generale SA 27.30010/20/2025 USD 9.400
Leonteq Securities AG 28.000 6/5/2024 CHF 34.680
Societe Generale SA 15.000 8/30/2024 USD 18.300
Societe Generale SA 16.000 8/1/2024 USD 13.800
Turkiye Ihracat Kredi 12.540 9/14/2028 TRY 51.713
Societe Generale SA 16.000 8/30/2024 USD 27.500
Societe Generale SA 15.00010/31/2024 USD 49.800
UkrLandFarming PLC 10.875 3/26/2018 USD 4.100
Societe Generale SA 20.000 1/29/2026 USD 12.300
Evocabank CJSC 11.000 9/27/2025 AMD 0.000
Societe Generale SA 15.000 8/1/2024 USD 18.700
Leonteq Securities AG 12.490 7/10/2024 USD 29.390
Zurcher Kantonalbank 24.673 6/28/2024 CHF 36.930
Societe Generale SA 15.360 11/8/2024 USD 24.400
Deutsche Bank AG/Lond 12.780 3/16/2028 TRY 45.606
Banco Espirito Santo 10.000 12/6/2021 EUR 0.063
Vontobel Financial Pr 10.500 4/26/2024 EUR 45.590
Credit Agricole Corpo 10.500 2/16/2027 TRY 49.771
Virgolino de Oliveira 10.875 1/13/2020 USD 36.000
Swissquote Bank SA 21.060 4/11/2024 CHF 13.460
Tailwind Energy Chino 12.500 9/27/2019 USD 1.500
PA Resources AB 13.500 3/3/2016 SEK 0.124
Armenian Economy Deve 11.000 10/3/2025 AMD 0.000
Tonon Luxembourg SA 12.500 5/14/2024 USD 0.010
Ukraine Government Bo 11.000 4/23/2037 UAH 25.654
Virgolino de Oliveira 11.750 2/9/2022 USD 0.611
Raiffeisen Schweiz Ge 15.500 4/11/2024 CHF 31.080
Tonon Luxembourg SA 12.500 5/14/2024 USD 0.010
Lehman Brothers Treas 14.900 9/15/2008 EUR 0.100
Russian Railways JSC 12.940 2/28/2040 RUB 50.000
Ukraine Government Bo 11.570 3/1/2028 UAH 43.530
KPNQwest NV 10.000 3/15/2012 EUR 0.733
Ukraine Government Bo 11.000 4/1/2037 UAH 25.778
Leonteq Securities AG 24.000 6/5/2024 CHF 32.770
Credit Suisse AG/Lond 20.00011/29/2024 USD 16.340
Evocabank CJSC 11.000 9/28/2024 AMD 0.000
Swissquote Bank SA 29.000 6/4/2024 CHF 38.800
Finca Uco Cjsc 12.000 2/10/2025 AMD 0.000
NTRP Via Interpipe Lt 10.250 8/2/2017 USD 0.898
Ukraine Government Bo 12.50010/12/2029 UAH 39.185
Societe Generale SA 16.000 7/3/2024 USD 21.800
Zurcher Kantonalbank 22.000 8/6/2024 USD 53.510
Finca Uco Cjsc 12.500 6/21/2024 AMD 8.000
Societe Generale SA 20.00011/28/2025 USD 7.150
Societe Generale SA 11.000 7/14/2026 USD 13.200
Raiffeisen Switzerlan 12.300 8/21/2024 CHF 14.250
Finca Uco Cjsc 13.000 5/30/2025 AMD 0.000
Swissquote Bank SA 20.120 6/20/2024 CHF 10.730
Finca Uco Cjsc 13.00011/16/2024 AMD 0.000
Credit Agricole Corpo 10.20012/13/2027 TRY 46.281
UBS AG/London 16.500 7/22/2024 CHF 20.920
EFG International Fin 11.12012/27/2024 EUR 30.910
Lehman Brothers Treas 16.00010/28/2008 USD 0.100
Inecobank CJSC 10.000 4/28/2025 AMD 0.000
Lehman Brothers Treas 11.750 3/1/2010 EUR 0.100
Virgolino de Oliveira 10.875 1/13/2020 USD 36.000
Leonteq Securities AG 24.000 8/14/2024 CHF 39.140
Leonteq Securities AG 28.000 5/30/2024 CHF 34.620
Leonteq Securities AG 24.000 5/22/2024 CHF 35.300
Leonteq Securities AG 30.000 4/24/2024 CHF 27.450
Leonteq Securities AG 24.000 4/11/2024 CHF 28.540
Leonteq Securities AG 24.000 6/19/2024 CHF 38.950
Ukraine Government Bo 10.570 5/10/2027 UAH 47.065
Ukraine Government Bo 11.000 2/16/2037 UAH 25.719
Societe Generale SA 15.000 9/29/2025 USD 7.000
Raiffeisen Switzerlan 20.000 7/10/2024 CHF 39.290
Bank Vontobel AG 25.000 7/22/2024 USD 30.300
Bank Vontobel AG 18.000 6/28/2024 CHF 34.400
Phosphorus Holdco PLC 10.000 4/1/2019 GBP 0.789
UniCredit Bank GmbH 16.550 8/18/2025 USD 31.150
UniCredit Bank GmbH 18.00012/31/2024 EUR 46.730
UniCredit Bank GmbH 18.90012/31/2024 EUR 45.540
UniCredit Bank GmbH 19.80012/31/2024 EUR 44.540
UBS AG/London 16.000 4/19/2024 CHF 30.900
Basler Kantonalbank 26.000 5/8/2024 CHF 34.770
Raiffeisen Schweiz Ge 18.400 5/2/2024 CHF 30.070
Bank Vontobel AG 23.500 4/29/2024 CHF 30.000
Leonteq Securities AG 24.000 9/25/2024 CHF 44.900
Raiffeisen Schweiz Ge 20.000 9/25/2024 CHF 28.800
UniCredit Bank GmbH 18.200 6/28/2024 EUR 25.250
UniCredit Bank GmbH 19.500 6/28/2024 EUR 24.830
Raiffeisen Schweiz Ge 20.000 9/25/2024 CHF 44.870
UniCredit Bank GmbH 17.000 6/28/2024 EUR 25.740
UniCredit Bank GmbH 17.20012/31/2024 EUR 32.690
UniCredit Bank GmbH 18.00012/31/2024 EUR 32.580
UBS AG/London 13.000 9/30/2024 CHF 21.900
Leonteq Securities AG 28.000 8/21/2024 CHF 39.920
Landesbank Baden-Wuer 10.000 8/23/2024 EUR 45.640
Landesbank Baden-Wuer 15.000 8/23/2024 EUR 36.970
Bank Vontobel AG 10.000 8/19/2024 CHF 10.200
Leonteq Securities AG 24.000 7/3/2024 CHF 34.980
Leonteq Securities AG 20.000 7/3/2024 CHF 10.820
Leonteq Securities AG 20.000 7/3/2024 CHF 35.100
Leonteq Securities AG 26.000 7/3/2024 CHF 39.460
Swissquote Bank SA 23.990 7/3/2024 CHF 35.810
HSBC Trinkaus & Burkh 11.250 6/27/2025 EUR 40.670
HSBC Trinkaus & Burkh 15.500 6/27/2025 EUR 38.220
Leonteq Securities AG 14.000 7/3/2024 CHF 10.090
ObedinenieAgroElita O 13.750 5/22/2024 RUB 21.600
Leonteq Securities AG 25.000 9/5/2024 EUR 44.250
Leonteq Securities AG 24.000 9/4/2024 CHF 43.340
Fast Credit Capital U 11.500 7/13/2024 AMD 0.000
UniCredit Bank GmbH 14.700 8/23/2024 EUR 34.910
UniCredit Bank GmbH 13.100 2/28/2025 EUR 42.780
UniCredit Bank GmbH 13.800 2/28/2025 EUR 42.160
UniCredit Bank GmbH 14.500 2/28/2025 EUR 41.420
Leonteq Securities AG 23.00012/27/2024 CHF 35.730
UniCredit Bank GmbH 15.800 6/28/2024 EUR 26.280
UniCredit Bank GmbH 18.80012/31/2024 EUR 32.510
UniCredit Bank GmbH 19.60012/31/2024 EUR 32.490
BNP Paribas Issuance 19.000 9/18/2026 EUR 0.820
HSBC Trinkaus & Burkh 20.250 6/28/2024 EUR 26.530
HSBC Trinkaus & Burkh 17.50012/30/2024 EUR 34.170
HSBC Trinkaus & Burkh 18.750 9/27/2024 EUR 30.570
Leonteq Securities AG 20.000 8/28/2024 CHF 17.080
UniCredit Bank GmbH 15.000 8/23/2024 EUR 36.480
UniCredit Bank GmbH 14.70011/22/2024 EUR 40.560
UniCredit Bank GmbH 13.700 9/27/2024 EUR 38.890
UniCredit Bank GmbH 14.800 9/27/2024 EUR 37.780
UniCredit Bank GmbH 19.30012/31/2024 EUR 38.210
Landesbank Baden-Wuer 11.000 6/28/2024 EUR 28.510
Bank Vontobel AG 19.000 4/9/2024 CHF 19.400
Leonteq Securities AG 22.000 8/7/2024 CHF 34.380
Vontobel Financial Pr 18.000 9/27/2024 EUR 27.890
Basler Kantonalbank 21.000 7/5/2024 CHF 34.720
Basler Kantonalbank 24.000 7/5/2024 CHF 40.680
UniCredit Bank GmbH 10.300 9/27/2024 EUR 30.680
UniCredit Bank GmbH 19.800 6/28/2024 EUR 31.340
Swissquote Bank SA 23.200 8/28/2024 CHF 43.050
Raiffeisen Schweiz Ge 20.000 8/28/2024 CHF 19.430
Leonteq Securities AG 28.000 9/5/2024 CHF 42.070
UniCredit Bank GmbH 14.50011/22/2024 EUR 38.980
Societe Generale SA 15.11010/31/2024 USD 28.000
Citigroup Global Mark 14.650 7/22/2024 HKD 36.230
Leonteq Securities AG 24.000 7/10/2024 CHF 35.020
Leonteq Securities AG 26.000 7/10/2024 CHF 42.170
UniCredit Bank GmbH 15.100 9/27/2024 EUR 45.690
UniCredit Bank GmbH 16.400 9/27/2024 EUR 44.030
Leonteq Securities AG 20.000 8/7/2024 CHF 16.860
Leonteq Securities AG 30.000 8/7/2024 CHF 36.120
UniCredit Bank GmbH 18.50012/31/2024 EUR 39.770
UniCredit Bank GmbH 19.30012/31/2024 EUR 39.200
Societe Generale SA 20.000 9/18/2026 USD 12.500
UniCredit Bank GmbH 18.200 6/28/2024 EUR 33.520
UniCredit Bank GmbH 19.500 6/28/2024 EUR 32.480
Raiffeisen Schweiz Ge 20.000 8/7/2024 CHF 33.770
DZ Bank AG Deutsche Z 16.000 6/28/2024 EUR 34.240
Leonteq Securities AG 24.000 1/13/2025 CHF 31.900
Societe Generale SA 16.000 7/3/2024 USD 28.500
Societe Generale SA 23.510 6/23/2026 USD 7.600
Bank Vontobel AG 13.500 1/8/2025 CHF 19.100
UniCredit Bank GmbH 13.800 9/27/2024 EUR 35.850
UniCredit Bank GmbH 14.800 9/27/2024 EUR 34.970
UniCredit Bank GmbH 15.800 9/27/2024 EUR 34.210
UniCredit Bank GmbH 16.900 9/27/2024 EUR 33.590
UniCredit Bank GmbH 18.000 9/27/2024 EUR 33.070
UniCredit Bank GmbH 19.100 9/27/2024 EUR 32.620
Leonteq Securities AG 22.000 8/14/2024 CHF 46.390
Leonteq Securities AG 21.000 8/14/2024 CHF 37.380
UBS AG/London 10.000 5/14/2024 USD #N/A N/A
Leonteq Securities AG 22.000 10/2/2024 CHF 43.480
Raiffeisen Switzerlan 16.000 5/22/2024 CHF 25.700
Swissquote Bank SA 25.080 6/12/2024 CHF 33.530
Societe Generale SA 13.01011/14/2024 USD #N/A N/A
ACBA Bank OJSC 11.000 12/1/2025 AMD 0.000
Vontobel Financial Pr 21.000 6/28/2024 EUR 47.350
Raiffeisen Bank Inter 14.558 9/25/2024 EUR 47.720
Societe Generale SA 15.840 8/30/2024 USD 14.300
Leonteq Securities AG 20.000 5/2/2024 CHF 30.540
Leonteq Securities AG 25.000 5/2/2024 CHF 31.090
Leonteq Securities AG 27.500 5/2/2024 CHF 31.620
HSBC Trinkaus & Burkh 14.80012/30/2024 EUR 39.530
HSBC Trinkaus & Burkh 13.40012/30/2024 EUR 40.790
HSBC Trinkaus & Burkh 11.20012/30/2024 EUR 43.790
Ameriabank CJSC 10.000 2/20/2025 AMD 8.800
Leonteq Securities AG 20.000 9/26/2024 USD 33.270
UniCredit Bank GmbH 10.500 9/23/2024 EUR 30.380
UBS AG/London 18.750 5/31/2024 CHF 35.450
ACBA Bank OJSC 11.500 3/1/2026 AMD 0.000
National Mortgage Co 12.000 3/30/2026 AMD 0.000
Raiffeisen Switzerlan 20.000 5/22/2024 CHF 42.350
UBS AG/London 14.50010/14/2024 CHF 39.000
Zurcher Kantonalbank 18.000 4/17/2024 CHF 28.850
Leonteq Securities AG 20.000 4/24/2024 CHF 35.790
JP Morgan Structured 15.500 11/4/2024 USD 30.480
UBS AG/London 10.000 3/23/2026 USD 27.350
Societe Generale SA 18.000 8/30/2024 USD 14.000
Sintekom TH OOO 13.000 1/23/2025 RUB 17.240
Leonteq Securities AG 19.000 6/3/2024 CHF 47.670
Bank Vontobel AG 23.000 6/4/2024 CHF 33.500
Leonteq Securities AG 21.000 5/22/2024 USD 26.660
UniCredit Bank GmbH 17.800 6/28/2024 EUR 44.970
EFG International Fin 24.000 6/14/2024 CHF 40.070
Leonteq Securities AG 20.000 6/19/2024 CHF 31.090
Leonteq Securities AG 15.000 9/12/2024 USD 25.720
Leonteq Securities AG 19.000 6/10/2024 CHF 29.850
Basler Kantonalbank 18.000 6/17/2024 CHF 30.100
Bank Vontobel AG 12.000 9/30/2024 EUR 14.200
Zurcher Kantonalbank 15.000 7/12/2024 CHF 47.900
HSBC Trinkaus & Burkh 15.000 6/28/2024 EUR 31.460
HSBC Trinkaus & Burkh 11.000 6/28/2024 EUR 36.870
UniCredit Bank GmbH 19.700 6/28/2024 EUR 35.200
UniCredit Bank GmbH 19.50012/31/2024 EUR 41.540
UBS AG/London 19.500 7/19/2024 CHF 38.600
HSBC Trinkaus & Burkh 19.000 6/28/2024 EUR 28.860
UBS AG/London 14.250 7/12/2024 EUR 17.080
Swissquote Bank SA 21.320 7/17/2024 CHF 44.370
Leonteq Securities AG 21.000 7/17/2024 CHF 44.220
Leonteq Securities AG 24.000 8/21/2024 CHF 41.310
Basler Kantonalbank 22.000 9/6/2024 CHF 40.120
UniCredit Bank GmbH 18.60012/31/2024 EUR 42.260
Societe Generale SA 25.26010/30/2025 USD 9.400
Bank Vontobel AG 15.50011/18/2024 CHF 39.000
HSBC Trinkaus & Burkh 17.600 9/27/2024 EUR 33.680
HSBC Trinkaus & Burkh 12.50012/30/2024 EUR 39.410
UniCredit Bank GmbH 19.400 6/28/2024 EUR 30.140
UniCredit Bank GmbH 19.10012/31/2024 EUR 37.130
Leonteq Securities AG 30.000 5/8/2024 CHF 31.350
UBS AG/London 14.250 8/19/2024 CHF 27.360
UniCredit Bank GmbH 20.00012/31/2024 EUR 36.860
Raiffeisen Switzerlan 10.500 7/11/2024 USD 23.960
UBS AG/London 18.750 4/15/2024 CHF 24.900
DZ Bank AG Deutsche Z 10.300 4/26/2024 EUR 45.970
Armenian Economy Deve 10.500 5/4/2025 AMD 0.000
Leonteq Securities AG 26.000 7/31/2024 CHF 43.090
UBS AG/London 18.750 4/26/2024 CHF 26.960
Swissquote Bank SA 27.050 7/31/2024 CHF 43.610
Swissquote Bank SA 16.380 7/31/2024 CHF 13.930
Swissquote Bank SA 22.120 4/11/2024 CHF 31.730
BNP Paribas Issuance 20.000 9/18/2026 EUR 29.000
UniCredit Bank GmbH 17.800 6/28/2024 EUR 28.510
UniCredit Bank GmbH 19.200 6/28/2024 EUR 27.870
UniCredit Bank GmbH 18.80012/31/2024 EUR 35.250
UniCredit Bank GmbH 19.70012/31/2024 EUR 35.120
Swissquote Bank SA 24.040 9/11/2024 CHF 41.290
UBS AG/London 25.000 7/12/2024 CHF 38.550
Leonteq Securities AG 18.000 9/11/2024 CHF 18.770
Raiffeisen Schweiz Ge 20.000 9/11/2024 CHF 39.090
Leonteq Securities AG 24.000 7/17/2024 CHF 36.010
Leonteq Securities AG 22.000 9/11/2024 CHF 39.670
Raiffeisen Switzerlan 20.000 5/10/2024 CHF 35.770
EFG International Fin 15.000 7/12/2024 CHF 46.430
Vontobel Financial Pr 16.000 6/28/2024 EUR 47.710
Vontobel Financial Pr 19.000 6/28/2024 EUR 45.630
Leonteq Securities AG 27.600 6/26/2024 CHF 36.160
Leonteq Securities AG 21.600 6/26/2024 CHF 12.120
Leonteq Securities AG 23.000 5/15/2024 CHF 39.540
Leonteq Securities AG 23.000 6/26/2024 CHF 31.460
Corner Banca SA 18.500 9/23/2024 CHF 15.700
Raiffeisen Switzerlan 20.000 6/26/2024 CHF 40.580
HSBC Trinkaus & Burkh 15.10012/30/2024 EUR 37.230
HSBC Trinkaus & Burkh 10.80012/30/2024 EUR 41.580
Basler Kantonalbank 18.000 6/21/2024 CHF 32.920
Bank Vontobel AG 20.000 6/26/2024 CHF 30.000
Raiffeisen Schweiz Ge 16.000 4/18/2024 CHF 34.180
Leonteq Securities AG 27.000 5/30/2024 CHF 11.140
HSBC Trinkaus & Burkh 17.000 6/28/2024 EUR 34.720
Leonteq Securities AG 15.000 7/24/2024 CHF 13.910
BNP Paribas SA 10.000 7/26/2027 USD #N/A N/A
Zurcher Kantonalbank 15.000 4/18/2024 CHF 44.730
Leonteq Securities AG 22.000 4/17/2024 CHF 28.750
Leonteq Securities AG 26.000 4/17/2024 CHF 30.810
HSBC Trinkaus & Burkh 18.300 9/27/2024 EUR 40.680
HSBC Trinkaus & Burkh 13.600 9/27/2024 EUR 47.090
HSBC Trinkaus & Burkh 15.900 9/27/2024 EUR 43.380
Bank Vontobel AG 13.000 6/26/2024 CHF 9.100
Leonteq Securities AG 26.000 5/22/2024 CHF 33.820
Swissquote Bank SA 21.550 4/17/2024 CHF 35.440
HSBC Trinkaus & Burkh 17.300 9/27/2024 EUR 35.870
Raiffeisen Schweiz Ge 16.000 7/24/2024 CHF 42.980
Leonteq Securities AG 27.000 7/24/2024 CHF 15.180
Raiffeisen Schweiz Ge 19.500 6/6/2024 CHF 34.120
Leonteq Securities AG 28.000 4/11/2024 CHF 25.640
Zurcher Kantonalbank 17.400 4/19/2024 USD 44.480
UBS AG/London 15.75010/21/2024 CHF 41.150
Converse Bank 10.500 5/22/2024 AMD 10.180
Citigroup Global Mark 25.530 2/18/2025 EUR 1.970
Bank Vontobel AG 18.000 7/19/2024 CHF 35.500
Vontobel Financial Pr 11.000 6/28/2024 EUR 47.080
Vontobel Financial Pr 19.500 6/28/2024 EUR 44.500
Vontobel Financial Pr 11.000 6/28/2024 EUR 40.510
Vontobel Financial Pr 14.000 6/28/2024 EUR 47.710
Vontobel Financial Pr 12.500 6/28/2024 EUR 47.390
Vontobel Financial Pr 24.750 6/28/2024 EUR 29.270
UniCredit Bank GmbH 13.400 9/27/2024 EUR 40.570
Basler Kantonalbank 17.000 7/19/2024 CHF 39.050
EFG International Fin 10.300 8/23/2024 USD 32.500
Leonteq Securities AG 21.000 6/5/2024 CHF 33.860
Raiffeisen Switzerlan 17.500 5/30/2024 CHF 34.870
Swissquote Bank SA 26.980 6/5/2024 CHF 37.460
Vontobel Financial Pr 16.500 6/28/2024 EUR 46.410
UniCredit Bank GmbH 13.90011/22/2024 EUR 41.730
UniCredit Bank GmbH 13.500 2/28/2025 EUR 44.930
Bank Vontobel AG 10.000 5/28/2024 CHF 72.600
Swissquote Bank SA 25.390 5/30/2024 CHF 35.020
UniCredit Bank GmbH 14.300 8/23/2024 EUR 37.870
ASCE Group OJSC 12.000 6/11/2031 AMD 0.000
Leonteq Securities AG 28.000 5/2/2024 CHF 27.230
Societe Generale Effe 13.250 4/26/2024 EUR 46.080
UniCredit Bank GmbH 10.700 2/3/2025 EUR 25.840
UniCredit Bank GmbH 10.700 2/17/2025 EUR 26.100
Bank Vontobel AG 12.000 6/10/2024 CHF 43.100
Leonteq Securities AG 16.000 6/20/2024 CHF 27.230
UBS AG/London 13.750 7/1/2024 CHF 31.100
Leonteq Securities AG 19.000 5/24/2024 CHF 10.440
UniCredit Bank GmbH 18.900 6/28/2024 EUR 38.370
Raiffeisen Switzerlan 20.000 6/19/2024 CHF 31.940
Bank Vontobel AG 20.000 4/15/2024 CHF 28.000
Ist Saiberian Petrole 14.00012/28/2024 RUB 10.020
Bank Julius Baer & Co 12.720 2/17/2025 CHF 37.100
DZ Bank AG Deutsche Z 11.200 6/28/2024 EUR 44.240
UBS AG/London 13.500 8/15/2024 CHF 48.200
Leonteq Securities AG 11.000 5/13/2024 CHF 39.790
Leonteq Securities AG 14.000 4/30/2024 CHF 10.110
Leonteq Securities AG 15.000 4/30/2024 CHF 44.070
UniCredit Bank GmbH 17.100 6/28/2024 EUR 42.220
UniCredit Bank GmbH 18.000 6/28/2024 EUR 40.180
UniCredit Bank GmbH 19.800 6/28/2024 EUR 36.760
Zurcher Kantonalbank 16.000 6/14/2024 CHF 42.460
UBS AG/London 18.500 6/14/2024 CHF 35.050
Raiffeisen Switzerlan 18.000 6/12/2024 CHF 32.370
Raiffeisen Switzerlan 16.000 6/12/2024 CHF 26.600
Raiffeisen Schweiz Ge 20.000 6/12/2024 CHF 41.690
Zurcher Kantonalbank 13.000 6/7/2024 CHF 42.470
Zurcher Kantonalbank 17.500 6/7/2024 CHF 45.230
Bank Vontobel AG 21.000 6/10/2024 CHF 31.500
Basler Kantonalbank 16.000 6/14/2024 CHF 25.920
Bank Vontobel AG 22.000 5/31/2024 CHF 24.500
DZ Bank AG Deutsche Z 24.300 6/28/2024 EUR 44.830
Leonteq Securities AG 23.400 6/19/2024 CHF 32.480
Ukraine Government Bo 10.36011/10/2027 UAH 43.120
Deutsche Bank AG/Lond 14.900 5/30/2028 TRY 49.155
Credit Agricole Corpo 10.200 8/6/2026 TRY 52.320
Lehman Brothers Treas 10.00010/22/2008 USD 0.100
Lehman Brothers Treas 11.00012/20/2017 AUD 0.100
Lehman Brothers Treas 10.00010/23/2008 USD 0.100
Lehman Brothers Treas 11.000 2/16/2009 CHF 0.100
Lehman Brothers Treas 13.000 2/16/2009 CHF 0.100
Ukraine Government Bo 12.500 4/27/2029 UAH 40.541
Lehman Brothers Treas 16.200 5/14/2009 USD 0.100
Lehman Brothers Treas 16.000 11/9/2008 USD 0.100
Lehman Brothers Treas 10.000 5/22/2009 USD 0.100
Lehman Brothers Treas 10.44211/22/2008 CHF 0.100
Lehman Brothers Treas 10.000 2/16/2009 CHF 0.100
Lehman Brothers Treas 10.000 6/11/2038 JPY 0.100
Lehman Brothers Treas 11.25012/31/2008 USD 0.100
Lehman Brothers Treas 15.000 6/4/2009 CHF 0.100
Lehman Brothers Treas 23.300 9/16/2008 USD 0.100
Lehman Brothers Treas 12.400 6/12/2009 USD 0.100
Lehman Brothers Treas 10.000 6/17/2009 USD 0.100
Lehman Brothers Treas 12.000 7/4/2011 EUR 0.100
Lehman Brothers Treas 13.00012/14/2012 USD 0.100
Lehman Brothers Treas 11.000 7/4/2011 CHF 0.100
Lehman Brothers Treas 16.800 8/21/2009 USD 0.100
Credit Agricole Corpo 11.190 3/12/2027 TRY 50.683
Lehman Brothers Treas 12.000 7/13/2037 JPY 0.100
Ukraine Government Bo 10.710 4/26/2028 UAH 41.137
Ukraine Government Bo 11.110 3/29/2028 UAH 42.346
BLT Finance BV 12.000 2/10/2015 USD 10.500
Ukraine Government Bo 11.580 2/2/2028 UAH 43.917
Credit Agricole Corpo 10.320 7/22/2026 TRY 52.721
Teksid Aluminum Luxem 12.375 7/15/2011 EUR 0.619
Lehman Brothers Treas 13.000 7/25/2012 EUR 0.100
Petromena ASA 10.85011/19/2018 USD 0.622
Lehman Brothers Treas 16.000 10/8/2008 CHF 0.100
Lehman Brothers Treas 11.000 7/4/2011 USD 0.100
Lehman Brothers Treas 13.15010/30/2008 USD 0.100
Lehman Brothers Treas 14.10011/12/2008 USD 0.100
Lehman Brothers Treas 10.600 4/22/2014 MXN 0.100
Lehman Brothers Treas 17.000 6/2/2009 USD 0.100
Lehman Brothers Treas 13.500 6/2/2009 USD 0.100
Lehman Brothers Treas 16.00012/26/2008 USD 0.100
Lehman Brothers Treas 13.432 1/8/2009 ILS 0.100
Lehman Brothers Treas 13.50011/28/2008 USD 0.100
Lehman Brothers Treas 15.000 3/30/2011 EUR 0.100
Lehman Brothers Treas 10.500 8/9/2010 EUR 0.100
Lehman Brothers Treas 10.000 3/27/2009 USD 0.100
Lehman Brothers Treas 11.00012/19/2011 USD 0.100
Sidetur Finance BV 10.000 4/20/2016 USD 0.219
Lehman Brothers Treas 11.000 6/29/2009 EUR 0.100
Bulgaria Steel Financ 12.000 5/4/2013 EUR 0.216
Lehman Brothers Treas 18.250 10/2/2008 USD 0.100
Lehman Brothers Treas 14.90011/16/2010 EUR 0.100
Lehman Brothers Treas 11.00012/20/2017 AUD 0.100
Lehman Brothers Treas 11.00012/20/2017 AUD 0.100
Ukraine Government Bo 11.000 4/24/2037 UAH 28.232
Ukraine Government Bo 11.000 3/24/2037 UAH 25.827
Ukraine Government Bo 11.000 4/8/2037 UAH 25.736
Ukraine Government Bo 11.000 4/20/2037 UAH 25.388
Credit Agricole Corpo 11.640 3/24/2027 TRY 51.355
Privatbank CJSC Via U 10.875 2/28/2018 USD 4.689
*********
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 2024. All rights reserved. ISSN 1529-2754.
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