/raid1/www/Hosts/bankrupt/TCREUR

/raid1/www/Hosts/bankrupt/TCREUR_Public/250217.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, February 17, 2025, Vol. 26, No. 34 Headlines C Y P R U S ARAGVI HOLDING: Fitch Affirms 'B+' LongTerm IDRs, Outlook Stable F I N L A N D PHM GROUP: Moody's Rates New EUR1,000MM Secured Term Loan B 'B2' PHM GROUP: S&P Rates New EUR1,000MM Term Loan B 'B', Outlook Stable F R A N C E TAURUS 2025-1: Fitch Assigns 'BB(EXP)sf' Rating on Class E Notes G E R M A N Y IGLOO HOLDING: Moody's Assigns First Time 'Ba3' Corp. Family Rating MINIMAX VIKING: S&P Affirms 'BB-' ICR, Outlook Stable TUI AG: Fitch Assigns 'BB' LongTerm IDR, Outlook Stable I R E L A N D BARINGS EURO 2018-3: Moody's Cuts EUR10MM F Notes Rating to Caa2 BLACKROCK CLO XIV: Fitch Assigns 'B-sf' Rating on Class F-R Notes BLACKROCK EUROPEAN IV: Moody's Ups EUR13.9MM F Notes Rating to B1 BRIDGEPOINT IV: Fitch Assigns 'B-sf' Final Rating on Cl. F-R Notes CARLYLE EURO 2021-2: Fitch Hikes Rating on Class D Notes to 'BBsf' CVC CORDATUS XVI: Fitch Affirms 'Bsf' Rating on Class F Debt JUBILEE CLO 2025-XXX: Fitch Assigns B-(EXP)sf Rating on Cl. F Notes NASSAU EURO II: Fitch Assigns 'B-sf' Final Rating on Cl. F-R Notes SOUND POINT VI: Fitch Hikes Rating on Class E Notes to 'BBsf' SPINNAKER DEBTCO: S&P Raises LongTerm ICR to 'B', Outlook Stable I T A L Y 4MORI SARDEGNA: DBRS Confirms B Rating on Class A Notes BENDING SPOONS: S&P Assigns Preliminary 'B+' ICR, Outlook Stable BUONCONSIGLIO 3: DBRS Cuts Credit Rating to B, Trend Negative DECO 2019 - VIVALDI: DBRS Confirms B(high) Rating on Class D Notes INFRASTRUCTURE WIRELESS: S&P Affirms 'BB+' ICR, Outlook Stable PIETRA NERA: DBRS Hikes Class E Notes Rating to BB REKEEP SPA: Moody's Affirms 'B3' CFR & Alters Outlook to Stable K A Z A K H S T A N KASPI BANK: S&P Withdraws 'BB+/B' Issuer Credit Ratings N E T H E R L A N D S JUBILEE PLACE 7: DBRS Gives Prov. B(high) Rating on Class E Notes SANDY HOLDCO: S&P Downgrades ICR to 'B-', Outlook Stable SPRINT MIDCO: S&P Assigns 'CCC' LongTerm ICR, Outlook Negative S P A I N GRUPO AVINTIA: DBRS Confirms B(low) Issuer Rating, Stable Trend U N I T E D K I N G D O M CAPRI HOLDINGS: Fitch Affirms 'BB' LongTerm IDR, Outlook Negative J.S. WRIGHT: FRP Advisory Named as Administrators KULTRALAB LTD: Quantuma Advisory Named as Administrators MAGIC ROCK: FRP Advisory Named as Administrators NEWDAY PARTNERSHIP VFN-P1: DBRS Confirms BB(high) Rating on E Notes ORIGAMI ENERGY: FRP Advisory Named as Administrators PEAK JERSEY: S&P Lowers LongTerm ICR to 'CCC+', Outlook Negative WRIGHT MAINTENANCE: FRP Advisory Named as Administrators [] Perry Higgins Joins PwC's Restructuring Team in Manchester [] PFK Smith Cooper Dean Nelson to Lead Nottingham Team [] PKF Smith's E. Oliver Becomes Licensed Insolvency Practitioner X X X X X X X X [] BOND PRICING: For the Week February 10 to February 14, 2025 - - - - - =========== C Y P R U S =========== ARAGVI HOLDING: Fitch Affirms 'B+' LongTerm IDRs, Outlook Stable ---------------------------------------------------------------- Fitch Ratings has affirmed Aragvi Holding International Limited's (Trans-Oil) Foreign-Currency (FC) and Local-Currency Issuer Default Ratings (LC IDRs) at 'B+' with Stable Outlook. The ratings reflect the group's moderate scale and high reliance on one sourcing region for soft commodities. The ratings are supported by the group's dominant and well-protected market position in agricultural exports and sunflower-seed crushing in Moldova with increasing diversification to Serbia and Romania, which together translate into higher average EBITDA margins than at larger international peers. The Stable Outlook captures its expectation that Trans-Oil will continue to generate EBITDA of over USD180 million over FY25-FY27 (year end to June). This is despite a temporary contraction in sales from the crushing operations in FY25 and its assumption of a gradual decline in grain origination volumes from Ukraine from FY25. This, together with its estimates of flat-to-positive free cash flow (FCF), will translate into resilient leverage metrics over the next four years. Key Rating Drivers EBITDA Moderation in FY25: Fitch projects Trans-Oil's EBITDA at around USD185 million in FY25, down from USD210 million in FY24, due to its forecast of further sales decline in the historically more profitable crushing business. This also reflects its assumption of further moderation in soft commodities prices and reduction in grain origination volumes from Ukraine in FY25. Fitch projects EBITDA to return toward USD200 million in FY26-FY27, supported by increased crushing and origination operations in Romania and Serbia, which to a large extent offsets its assumption of lower origination volumes from Ukraine. Superior EBITDA Margin: Historically, Trans-Oil has had above industry average EBITDA margins in both the crushing and trading segments, and Fitch forecasts the group's profitability will remain at 9%-9.5% over FY25-FY28, versus 9.1% in FY24. High margins are supported by the group's leading market positions and dominant scale in its regions, improving operating efficiencies at its facilities, and growing infrastructure capacities. Temporary Change in Sales Mix: Since 2HFY24 Trans-oil has shifted some procured sunflower seeds from crushing to trading, as lower prices for sunflower oil led to weaker crushing margins, while demand and prices for sunflower seeds rose in the region, due to drought conditions. Lower sales from the crushing and refining business were more than offset by increased origination activity, leading to 8% total revenue growth in FY24. Fitch expects sales from crushing to fall further in FY25, before returning to historical levels from FY26 as prices for sunflower oil and seeds normalise on a recovery in harvest. Improving Diversification: Trans-Oil continues to expand its capacity in Romania and Serbia, by investing in silos and port-terminal infrastructure on the Danube river, which supports trading growth outside of Moldova, including via origination from Ukraine. Fitch expects a gradual substitution of Ukraine origination with other markets, while still maintaining some of the volumes sourced from western Ukraine in the long run. In FY24 Trans-Oil generated 70% of EBITDA from commodities originated outside of Moldova, compared with 20% in FY20, due largely to grain trading sourced in Ukraine. High Capex in FY25-26: Trans-Oil plans to continue expanding its crushing and infrastructure facilities in Serbia and Romania. This includes a new soybean and rape seeds crushing plant construction in Romania in FY25-FY26, with an annual crushing capacity of up to 300 thousand tonnes at an overall capex of EUR43 million. The project will be partly funded by a EUR25 million grant from the Romanian government. Together with other investments, Fitch assumes annual capex at around 4% and 2% of revenue in FY25 and FY26, respectively, versus a historical average of 1%. Leverage in Line with Rating: Fitch projects Trans-Oil's readily marketable inventories (RMI)-adjusted EBITDA net leverage to be unchanged at 2.7x in FY25. In the absence of new capacity expansion projects or material acquisitions Fitch expects further deleveraging through positive FCF generation, due to moderating capex and normalising working capital requirements over FY26-FY27. Trans-Oil's growth strategy suggests a potential for additional expansion projects, but Fitch expects them to be funded in line with the group's conservative financial policy. Normalising FCF: Fitch projects FCF margins to turn positive at low single digits from FY25 as normalising working capital requirements offset increased capex of around USD130 million assumed for FY25-FY26. Trans-Oil's FCF turned negative in FY24 to USD52 million on increased working capital requirements, due to higher origination and trading volumes plus longer logistics routes and collection periods resulting from disruption to the Red Sea routes. Strong Market Position in Moldova: Trans-Oil's dominant market position in Moldovan agricultural exports and sunflower seed crushing underpins its IDRs. It is the largest oil producer and exporter of agricultural commodities in Moldova. Its ownership of material infrastructure assets is a major competitive advantage as it operates the country's largest inland silo network and owns a port terminal in the only seagoing vessel port. Fitch expects the planned investment in Romania to reinforce its positioning in the Black Sea region. Derivation Summary Trans-Oil is considerably smaller and has a weaker ranking on a global scale than international agricultural commodity traders and processors, such as Cargill Incorporated (A/Stable), Archer Daniels Midland Company (A/Negative) and Bunge Global SA (BBB+/Stable). Trans-Oil's two-notch rating differential compared with Tereos SCA (BB/Positive) reflects the latter's stronger business profile supported by its larger scale, greater geographic diversification, and more flexible cost structure. This is partly offset by Tereos' weaker financial structure. Trans-Oil compares well with Ukrainian sunflower seed crusher and grain trader Kernel Holding S.A. (CCC-), due to similarity in their operations and vertically integrated models, which include sizeable logistics and infrastructure assets. The main difference in business models is Kernel's integration into crop-growing, which limits sourcing and procurement risk, and a wider and more diversified customer base. Kernel also has greater business scale and a larger sourcing market, which until Russia's invasion of Ukraine, provided greater protection from weather risks. By contrast, Trans-Oil's competition risks are lower than Kernel's, due to its stronger market position and the absence of material competition from global commodity traders and processors in Moldova. Kernel's IDR reflects heightened operational and financial risks since the Russian invasion of Ukraine. Key Assumptions Fitch's Key Assumptions Within Its Rating Case for the Issuer Gradual decline in key agricultural commodity prices Decline of origination and trading volumes from Ukraine toward 600 thousand tonnes by FY28 from almost 1,900 thousand tonnes in FY24 Revenue to decline 11% in FY25, followed by a 6% increase in FY26 EBITDA margins at 9% over FY25-FY28 Slightly decreasing interest expense on floating-rate trade-finance facilities, driven by its lower interest rates assumptions for FY25-FY28 Reversal of working capital outflows, followed by a normalisation of working capital requirements Increased capex of around USD90 million in FY25 and USD40 million in FY26, before normalising towards USD25 million annually No dividends Recovery Analysis The senior secured eurobond is rated in line with Trans-Oil's IDR of 'B+', reflecting average recovery prospects given default. The eurobond is secured by pledges over a majority of assets of key Moldovan entities, excluding commodities. Its recovery approach assumes the group will be liquidated instead of restructured in financial distress. The increase in liquid assets, such as RMI resulting from Trans-Oil's increased scale, will likely encourage creditors secured by these assets to pursue a liquidation. Under such an outcome, Fitch expects bondholders to receive better recoveries than for a going concern, given pledges over the group's other assets. Fitch has applied customary advance rates for the main assets in Trans-Oil, such as 80% for trade receivables, 30% for non-RMI inventories, and 30% for property plant and equipment. Fitch-adjusted RMI is used to repay outstanding working-capital credit lines first (USD269 million in FY24), as such creditors have direct recourse to these assets. Its assumptions result in a ranked recovery in the 'RR4' band for the senior secured eurobond, indicating a 'B+' rating. The waterfall analysis output percentage on metrics and assumptions was 64%. However, the eurobond is rated in line with Trans-Oil's 'B+' IDR, capped by the Moldovan jurisdiction, in accordance with Fitch's Country Specific Treatment of Recovery Ratings Criteria. Therefore, the waterfall analysis output percentage remains capped at 50%. RATING SENSITIVITIES Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade Weakening of operations, with consolidated EBITDA declining to below USD150 million RMI-adjusted EBITDA net leverage above 3.0x and RMI-adjusted EBITDA interest coverage below 1.5x More aggressive risk management or financial policy, as reflected by increased profit volatility and higher-than-expected investments in working capital, capex, M&A, or dividend payments Weakening of liquidity position, or risk of insufficient availability of trade-finance lines to fund trading and processing operations, with its internal liquidity score falling below 1.0x A deteriorating operating environment in Moldova Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade Increased scale toward USD250 million and further diversification leading to resilient EBITDA margins and positive FCF margins on a sustained basis Maintenance of a conservative capital structure, with RMI-adjusted EBITDA net leverage at or below 2.5x and a strengthening of risk-management practices Maintenance of strong internal liquidity, with sufficient availability of trade-financing lines to secure trading and processing volumes and to cope with price volatility A stable geopolitical environment in Trans-Oil's core countries of operation Liquidity and Debt Structure Trans-Oil had Fitch-adjusted available cash of USD104 million at FYE24, as well as a Fitch-estimated RMI of USD276 million and accounts receivable of USD237 million, which were sufficient to cover current liabilities of USD411 million. Fitch expects Trans-Oil will be able to maintain adequate internal liquidity over the next two years. In 2024 Trans-Oil refinanced its eurobond with a new USD550 million bond maturing in 2029, highlighting good access to capital markets and reducing its refinancing risk. It has also renewed and upsized its pre-export financing facilities to USD177 million. Issuer Profile Trans-Oil is a vertically integrated agro-industrial business based in Moldova with its core activities focused on origination and wholesale trade of grain and sunflower seeds, storage and trans-shipment operations and the production of vegetable oils (bottled and in bulk). MACROECONOMIC ASSUMPTIONS AND SECTOR FORECASTS Fitch's latest quarterly Global Corporates Macro and Sector Forecasts data file which aggregates key data points used in its credit analysis. Fitch's macroeconomic forecasts, commodity price assumptions, default rate forecasts, sector key performance indicators and sector-level forecasts are among the data items included. 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 ----------- ------ -------- ----- Aragvi Finance International DAC senior secured LT B+ Affirmed RR4 B+ Aragvi Holding International Limited LT IDR B+ Affirmed B+ LC LT IDR B+ Affirmed B+ ============= F I N L A N D ============= PHM GROUP: Moody's Rates New EUR1,000MM Secured Term Loan B 'B2' ---------------------------------------------------------------- Moody's Ratings has affirmed PHM Group Holding Oyj's corporate family rating and probability of default rating at B2 and B2-PD respectively. Moody's also assigned a B2 instrument rating to the proposed EUR1,000 million backed senior secured term loan B (TLB). The outlook remains negative. The B2 ratings on the existing backed senior secured TLB, senior secured and backed senior secured notes are unaffected. Those ratings will be withdrawn after the expected repayment as part of the new issuance. PHM intends to refinance its existing EUR640 million 2026 bond maturities, the EUR300 million existing TLB and the partially drawn existing revolving credit facility through a new EUR1,000 million term loan B (TLB) maturing 2032 and a new EUR150 million revolving credit facility maturing 12 months ahead of the new TLB. The transaction adds EUR35 million gross debt to the balance sheet that Moody's expect PHM to spend on its bolt-on M&A activities. RATINGS RATIONALE The rating affirmation balances PHM's improving and more diversified business profile and anticipated improvements of financial metrics with in-place leverage and cash flow metrics which are currently outside of the expectations for the B2 rating category. The company has entered into a series of acquisitions resulting in elevated leverage, weak interest cover and free cash flow generation, but Moody's positively recognize the robust operating performance of PHM's core property maintenance business. The B2 rating assigned to the proposed senior secured term loan reflects its pari passu ranking with existing instruments in the capital structure. The negative outlook reflects the risk that financial metrics do not improve sufficiently to meet the expectations for the B2 rating. As part of Moody's expectation for material improvements in financial metrics, Moody's do not anticipate material acquisitions funded with a sizable debt component that would hinder a deleveraging, as they would question sufficient financial discipline for the B2 rating. PHM's credit profile is supported by PHM's leading market position in the Nordics and Switzerland with additional operations in Germany, in a property maintenance market that continues to be highly fragmented. A large part of the company's revenues are recurring or re-occurring, with low customer churn and sustainable revenue growth. Furthermore, PHM operates with relatively high operating profitability in a business with lower volatility. The rating is constrained by PHM's M&A-driven growth strategy that makes deleveraging to expected levels more difficult to achieve. Moody's-adjusted debt/EBITDA is around 8.1x on a preliminary basis for FY 2024, a number distorted by material largely debt-funded acquisitions in 2024. Moody's do not expect Moody's-adjusted debt/EBITDA to fall below 6x in 2025 even if the platform transactions contribute a full year and some of the one-off expenses ease. While the company is confident to bring down leverage in line with the rating guidance, Moody's concern remains a continued M&A appetite will keep leverage and free cash flow lower. Moody's-adjusted EBITA margin is expected to grow above 10% in the next 12-18 months from the current 9.3% as of FY 2024 preliminary, driven by synergies, reduced one-off expense and performance contributions from recent acquisitions. Moody's expect EBITA/Interest expense to improve to 1.6-2x with the contemplated refinancing. Free cash flow to debt will remain muted in the 0 to 2% range. Moody's projections include about 100 million annual smaller bolt-on acquisitions. A comprehensive review of all credit ratings for the respective issuer(s) has been conducted during a rating committee. LIQUIDITY PROFILE Liquidity will be adequate post refinancing of its 2026 bond maturities and the 2025 RCF maturity. The company's liquidity profile benefits from around EUR55 million cash as of December 2024 that will increase to EUR90 million pro-forma for the transaction. In the absence of further expected acquisitions that would add to EBITDA and FFO, Moody's-adjusted FFO will contribute EUR90-100 million to available liquidity. The company has access to a RCF that will be upsized to EUR150 million as part of the contemplated transaction. These sources are sufficient to accommodate moderate working capital swings and maintenance and lease capital spending. Ultimate free cash flow generation will be modestly positive in Moody's projections. Yet Moody's expect the company to continue its aggressive acquisitive growth, which can result in further drawings under the RCF or potential future tap issuances. STRUCTURAL CONSIDERATIONS PHM's CFR of B2 is aligned with the existing and proposed debt instruments issued by the group. The rating alignment reflects the pari passu nature of the new RCF within the financial structure. The company's probability of default rating (PDR) of B2-PD is also in line with the CFR. The PDR reflects the use of a 50% family recovery rate resulting from a debt package without financial covenant and a security package that is limited to share pledges, intercompany loans and business mortgages. Further, the loans benefit from guarantees by wholly-owned material subsidiaries representing at least 80% of consolidated EBITDA. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS Upward pressure could arise if -- Moody's-adjusted debt/EBITDA sustains below 4.5x -- Moody's-adjusted EBITA/Interest above 2.5x -- FCF/debt increases towards the high single digits in percentage terms for a sustained period -- EBITA margins sustain above 10% Downward pressure on the ratings could develop if PHM's -- Liquidity deteriorates -- Moody's-adjusted debt/EBITDA remains above 6x -- EBITA/Interest sustained below 1.7x -- FCF turns negative for a sustained period The principal methodology used in these ratings was Business and Consumer Services published in November 2021. COMPANY PROFILE PHM Group Holding Oyj (PHM) is a leading company in the Northern European residential property maintenance services market, founded in 1989 with its headquarters in Helsinki. The group was acquired by a Nordic private equity firm, Norvestor Equity AS, in March 2020, holding the majority of voting rights. The group offers a broad range of services including general maintenance, cleaning, management, repairs and technical services for residential and commercial properties. PHM has around 13,700 employees across locally operating companies across Finland, Sweden, Norway, Denmark, Switzerland and Germany as of January 2025. As of full year 2024, the group generated revenue of EUR1,128 million (like-for-like, adjusted) from a highly granular customer base. COVENANTS Moody's have reviewed the marketing draft terms for the new credit facilities. Notable terms include the following: Guarantor coverage will be at least 80% of consolidated EBITDA (determined in accordance with the agreement) and include all Wholly-owned companies representing 5% or more of consolidated EBITDA. Security will be granted over Company and PHM Group Oyj shares under Finnish law and intra-group receivables. Any available debt capacity, including the following, can be made available as incremental facilities: unlimited pari passu debt is permitted up to a senior secured net leverage ratio of 5.5x, and unlimited unsecured debt is permitted subject to a 2.0x fixed charge coverage ratio. Unlimited restricted payments are permitted if the pro forma net leverage ratio (NLR) is 4.5x or lower and subordinated debt if NLR is 4.75x or lower. Asset sale proceeds are only required to be applied in full where SSNLR is 4.25x or greater. Adjustments to consolidated EBITDA include the full run rate of cost savings and synergies, capped at 20% of consolidated EBITDA and believed to be realisable within 18 months of the expected steps having being taken; otherwise capped at 25%. The proposed terms, and the final terms may be materially different. PHM GROUP: S&P Rates New EUR1,000MM Term Loan B 'B', Outlook Stable ------------------------------------------------------------------- S&P Global Ratings assigned its 'B' issue rating on PHM Group Holding Oyj (PHM)'s proposed term loan B (TLB) of EUR1,000 million, in line with the long-term issuer credit rating on PHM (B/Stable/--). Finland-based residential property services company PHM is proposing to issue a new TLB of EUR1,000 million to refinance its outstanding senior secured notes as well as EUR300 million term loan B and add additional liquidity on balance sheet for other general corporate purposes. S&P views the transaction as leverage neutral given the incremental proceeds will likely be used to fund its acquisition pipeline, in line with its growth strategy that includes largely debt-funded acquisitions as experienced over the last years. S&P assigned its 'B' issue rating on the proposed TLB, in line with the long-term issuer credit rating on PHM. S&P continues to expect meaningful recovery (50%-70%; rounded estimate: 50%). Operating performance during 2024 fell short of expectations, on the back of a softer fourth quarter 2024. Although the company modestly deleveraged close to 9.0x from about 10.0x in fiscal 2023 (ended Dec. 31). S&P said, "During 2024, PHM reported like-for-like revenue growth of 3% and approximately 50% on a reported basis, while we estimate revenue growth closer to 56% year on year. The lower-than-anticipated revenue growth stems from a weaker fourth quarter with negative 3.4% revenue growth year on year. This is driven by lower add-on sales on the back of mild weather conditions in the Nordics compared to the same period in 2023, and some expected discontinuation of lower margin public contracts, partially offset by higher pricing. We estimate the S&P Global Ratings-adjusted EBITDA margin to be 14.4% at year-end 2024, which is 40 basis points (bps) lower compared to our previous forecast, mainly due to higher exceptional costs and a slower ramp up of margins from acquired companies. Year over year EBITDA margin expanded by 80 bps, thanks to better operating leverage, good cost control, and some personnel-related cost synergies that had been realized. Therefore, we estimate leverage of 9.1x (7.5x pro forma for acquisitions) as of end-2024, compared with 8.7x previously and 10.1x as of end-2023. Funds from operations (FFO) to debt is estimated at 4.2% compared with 4.7% previously, and 5.4% in 2023. Over the next two years, we forecast leverage to reach 7.0x, with FFO to debt of 7.3% thanks to like-for-like revenue growth of up to 3% and ongoing small bolt-on acquisitions that will help expand its European footprint. We expect EBITDA margins increase to about 15.5% on the back of better operating leverage and margin uplifts from acquired companies due to synergy realizations, including streamlining the organizations, procurement savings, and some cross-selling opportunities at high margins. We also forecast that FFO cash interest coverage will increase to 2.0x from 2025." S&P said, "Despite lower EBITDA of about EUR8 million compared with our previous forecast, we anticipate free operating cash flow (FOCF) to be stronger in 2024 at approximately EUR40 million. The solid FOCF generation of PHM over the last 3 years is supported by its disciplined capital expenditure investments totaling about 3.0%-3.5% of revenue annually, and good working capital management that exhibits a structurally negative profile, with an anticipated inflow of close to EUR25 million in 2024. We expect positive FOCF generation over the next two years, in line with his historical track record, reaching at least EUR20 million in 2025 and 2026. The liquidity profile of PHM remains sound because the company continues to generate positive FOCF, with no near-term maturities on the back of this transaction, a new undrawn EUR150 million revolving credit facility, and EUR90 million of cash on balance sheet pro forma for the transaction." Issue Ratings--Recovery Analysis Key analytical factors -- S&P rates the proposed EUR1,000 million TLB issued by PHM, 'B' with a '3' recovery rating. The recovery rating indicates its expectation of meaningful recovery prospects (50%-70%; rounded estimate: 50%) in the event of a payment default. -- Recovery prospects for the senior secured debt are constrained by the asset-light nature of the business and a high debt quantum of senior secured debt outstanding. The security includes the customary share pledges and intercompany loans, and material operating bank accounts. In addition, there is a guarantor coverage test capturing around 80% of consolidated EBITDA within 120 days of the transaction's close. -- In S&P's hypothetical default scenario, it assumes that adverse economic conditions and increased competition, resulting in pricing pressure, a deterioration in service quality, and a loss of key customers, would undermine PHM's financial performance and cash flows and could result in an interest-payment default. -- S&P views PHM as a going concern, given its leading position in the Nordics and Swiss outsourced property services market, its recurring revenue base, and its well-diversified customer base. Simulated default assumptions -- Year of default: 2028 -- Jurisdiction: Finland Simplified waterfall -- Emergence EBITDA: EUR112.2 million -- Minimum capital expenditure: 2.5% of sales -- Cyclicality adjustment: 5%, which is standard for the business services sector -- Multiple: 5.5x -- Gross enterprise value at emergence: EUR617.2 million -- Net enterprise value after administrative expenses (5%): EUR586.3 million -- Collateral available for secured debt: EUR586.3 million -- Senior secured debt claims: EUR1,166 million* -- Recovery expectation: 50%-70% (rounded estimate: 50%) *All debt amounts include six months of prepetition interest, and S&P assumes 85% of the RCF to be drawn at default. =========== F R A N C E =========== TAURUS 2025-1: Fitch Assigns 'BB(EXP)sf' Rating on Class E Notes ---------------------------------------------------------------- Fitch Ratings has assigned Taurus 2025-1 EU DAC's notes expected ratings. The assignment of final ratings is contingent on the receipt of final information conforming to the reviewed documentation. Entity/Debt Rating ----------- ------ Taurus 2025-1 EU DAC 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 Transaction Summary The CMBS transaction is collateralised by 100% of a senior term facility refinancing a portfolio of 37 logistics properties. The assets are located across Germany and France and were acquired by the Carlyle Group during 2020 and 2021, including as part of a sale-and-leaseback with the main occupier, Kuhne + Nagel (K&N, 55% of passing rent). The term loan is a 3+1+1 facility with an aggregate loan amount of EUR259.8 million. KEY RATING DRIVERS Creditor-Friendly Structure: There is a simple, prudent release pricing formula set at 115% of allocated loan amount, which should preserve the integrity of this strategic logistics portfolio, supporting refinancing prospects. The loan facility also incorporates financial covenants on debt yield (years 1-3: over 6.3%; over 7% thereafter) and LTV (under 80%), which if breached (and uncured) will trigger loan default, sequential principal pay and subordination of the class X notes. Together with tighter cash trapping triggers (for excess rental income and excess spread), this structure helps stabilise note leverage. Fitch considers this structure superior to much of the product securitised in EMEA CMBS 2.0, and gives up to one notch credit (from model-implied results) to this in its ratings. Good Quality Assets: The portfolio consists of 37 good quality, mainly single-let medium-box logistics properties. Primarily cross-docked, the facilities are of varying sizes, with good specifications (adequate dock door coverage and yard depth) and well-located, mainly in out-of-town sites within reasonable driving distance of French or German populations. Tenants include a major player in the logistics sector, K&N, which occupies 25 of the 37 properties. The network of assets is well-suited to support supply chain services in the two countries. Near-100% occupancy reflects self-selected legacy leasing, and while it has likely peaked, lettability is supported by some recent refurbishment. Material Capex Planned: While much of the stock was constructed in the 1970s/80s, it has been well-maintained overall with an average refurbishment date of 2017 for the portfolio. Ongoing capex will be required to continue to meet occupational demand and green standards. Fitch views capex by the Sponsor as proportionate, averaging 4.5% of market value, underpinned by good locations, and well-covered by surplus rental cash flow over the term of the loan in the relevant rating cases. The valuation report flags works required to boost energy performance and ensure the assets keep up with rising green standards across the French and German logistics property markets. Fitch reflects the correspondingly higher reversionary yields in its property scores, which range from 1 to 4 (2.4 on a weighted average basis). French Legal Analysis: For one French property-owning entity, which only owns one property (in Bordeaux, 2.9% of MV), owing to a particularly low historical book value, its debt capacity (allocated loan amount, ALA) is unusually low (45% of historical value), and not compensated by a higher release premium. Fitch has assumed disposal of the Bordeaux asset on day one in all rating cases. For the other two French entities, credit recoveries in excess of their ALAs are subject to potential dilution by unsecured claims. Information shared by the arranger suggests no unsecured financial or trade creditors are present. Moreover, neither entity would realise any taxable capital gains in Fitch's rating cases. RATING SENSITIVITIES Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade A lower estimated rental value (ERV) could lead to negative rating action. The change in model output that would apply with a 15pp increase in rental value decline assumptions would imply the following ratings: 'A+sf' / 'BBBsf' / 'BB+sf' / 'B+sf' / 'Bsf' Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade Achieving significant rent increases following lease expiries could lead to positive rating action. The change in model output that would apply with a 1pp reduction to cap rate assumptions would imply the following ratings: 'AAAsf' / 'AAAsf' / 'A+sf' / 'BBB+sf' / 'BBB-sf' KEY PROPERTY ASSUMPTIONS (all weighted by net ERV) Weighted average (WA) depreciation: 3.1% Fitch Net ERV: 23.8 million 'Bsf' WA cap rate: 5.0% 'Bsf' WA structural vacancy: 12.7% 'Bsf' WA rental value decline: 16.2% 'BBsf' WA cap rate: 6.0% 'BBsf' WA structural vacancy: 13.7% 'BBsf' WA rental value decline: 19.4% 'BBBsf' WA cap rate: 7.2% 'BBBsf' WA structural vacancy: 15.4% 'BBBsf' WA rental value decline: 20.8% 'Asf' WA cap rate: 8.6% 'Asf' WA structural vacancy: 16.9% 'Asf' WA rental value decline: 22.2% 'AAsf' WA cap rate: 8.9% 'AAsf' WA structural vacancy: 17.9% 'AAsf' WA rental value decline: 23.5% 'AAAsf' WA cap rate: 9.4% 'AAAsf' WA structural vacancy: 19.6% 'AAAsf' WA rental value decline: 25.1% 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 Taurus 2025-1 EU DAC Fitch reviewed the results of a third party assessment conducted on the asset portfolio information, and concluded that there were no findings that affected the rating analysis. 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. ============= G E R M A N Y ============= IGLOO HOLDING: Moody's Assigns First Time 'Ba3' Corp. Family Rating ------------------------------------------------------------------- Moody's Ratings has assigned a first-time Ba3 long-term corporate family rating and Ba3-PD probability of default rating to Igloo Holding GmbH, a new holding company established as part of the transfer of Minimax Viking GmbH (Minimax Viking or the company), a global operator in the active fire protection and detection market, into new asset continuation funds managed by private equity firm Intermediate Capital Group (ICG). Concurrently, Moody's have assigned Ba3 ratings to the proposed EUR700 million senior secured term loan B, the EUR1,000 equivalent senior secured term loan B, both maturing in 2032 and to the EUR100 million senior secured revolving credit facility (RCF) maturing in 2031, all borrowed by Igloo Holding GmbH. In addition, Moody's have withdrawn the Ba3 CFR and Ba3-PD PDR of Minimax Viking GmbH. The assigned ratings assume successful completion of the planned transactions and are subject to Moody's receipt and review of final documentation. The outlook on Igloo Holding GmbH is stable. The proceeds from the proposed term loan will be used to partially finance the purchase price of the acquisition and refinance existing debt along with a cash equity contribution from the new funds of ICG. As a result, the transaction resets the capital structure while ICG's ultimate ownership stake remains unchanged at 90%, with the remaining shares retained by the founding family and management. "The credit metrics will be weaker and out of the defined guidance for the Ba3 rating with the proposed capital structure, with Moody's adjusted leverage expected at 5.2x as of 2024 on a pro forma basis and its free cash generation to decline from higher interest costs", says Dirk Goedde, a Moody's Ratings Vice President – Senior Analyst. "Additionally, the company's cash position will be significantly lower. However, despite the weaker point-in-time capital structure, Moody's take comfort from the company's strong and consistent track record of growing revenues and EBITDA which will support deleveraging and free cash flow generation in the next 12-18 months and bring metrics back into the Ba3 ratings guidance." RATINGS RATIONALE The Ba3 CFR of Igloo Holding GmbH continues to reflect the company's strong market positions in the highly regulated fire protection market, sizeable aftermarket business, and track record of strong operating and financial performance even during downturns, including stable Moody's-adjusted EBITA margins of 10%-13% and consistently positive free cash flow (FCF) generation with Moody's-adjusted FCF/debt expected in mid-single digits in the next 12-18 months. Moody's-adjusted gross leverage is expected at 5.2x as of 2024 and pro forma for the proposed transaction. Minimax Viking's private-equity ownership leads to risks of shareholder distributions and discretionary owner distributions over the next few years, which constrain its CFR. The terms of the senior facilities agreement prohibit any dividend distribution if the net leverage ratio (company-adjusted) is above 3.6x pro forma for the transaction. Limited geographical concentration also somewhat constrains the rating. A comprehensive review of all credit ratings for the respective issuer(s) has been conducted during a rating committee. OUTLOOK The stable outlook on Igloo Holding GmbH assumes sustained healthy market environment in Minimax Viking's key regions Germany and the US, which should support solid organic growth in sales and stable margins. It also reflects the expectation that the group will continue to generate positive FCF, allowing the leverage ratio to strengthen below 5x over the next 12 to 18 months. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS An upgrade of Igloo Holding GmbH's ratings would require a sustained improvement in credit metrics, including (1) debt/EBITDA (Moody's-adjusted) below 3.5x, (2) EBITA / Interest expense moving towards 5.0x, (3) Retained Cash Flow/ Net debt (Moody's-adjusted) above 20%, (4) FCF/debt (Moody's-adjusted) above 10%, and (5) continued good liquidity. Downward pressure on Igloo Holding GmbH's ratings would evolve, if (1) profitability were to weaken, exemplified by Moody's-adjusted EBITA margins reducing to 10% or lower, (2) leverage (Moody's-adjusted) remaining above 4.5x gross debt/EBITDA, (3) its FCF/debt (Moody's adjusted) declining persistently below 5%, (4) its RCF/net debt remaining below 15%, or (5) any change in financial policy as evinced by debt-funded acquisitions or shareholder distributions. LIQUIDITY Minimax Viking's liquidity is good. Pro forma for the proposed transaction, the group's available cash sources included a cash balance of at least EUR200 million, Moody's projected positive FCF of EUR70 million- EUR100 million per year and full availability under the upsized EUR100 million revolving credit facility maturing in 2031. Its liquidity sources comfortably cover all expected liquidity requirements of the group for 2025-26. Cash needs mainly comprise interest expense of around EUR100 million, capital spending of around EUR90 million, working cash and debt amortisation of about EUR10 million, all on an annual basis. STRUCTURAL CONSIDERATIONS Post transaction, the company's capital structure consists of a EUR100 million senior secured RCF, a EUR700 million senior secured term loan B and a EUR1,000 million equivalent senior secured term loan B, borrowed by Igloo Holding GmbH. The senior secured term loan B and the senior secured RCF are all rated Ba3, in line with the CFR, as they are the only financial debt instruments in the capital structure of these two entities and they all rank pari passu. The company has further access to a EUR250 million guarantee facility which is not included in Moody's debt waterfall in the loss given default assessment. ENVIRONMENTAL, SOCIAL AND GOVERNANCE CONSIDERATIONS Governance was a driver of the action. Minimax Viking's exposure to governance risks stem from its financial policy with a high tolerance for leverage. This weakness is to some extent offset by the company's strong operating track record as a leading operator in its field resulting in strong credit metrics. It furthermore has concentrated ownership and limited independence representation in its board. COVENANTS Moody's have reviewed the marketing draft terms for the new credit facilities. Notable terms include the following: Guarantor coverage will be at least 80% of consolidated EBITDA (determined in accordance with the agreement) and include all companies representing 5% or more of consolidated EBITDA. Only companies incorporated in Germany, Luxembourg and the USA are required to provide guarantees and security. Security will be granted over key shares, bank accounts and intra-group receivables. Unlimited pari passu debt is permitted up to a senior secured net leverage ratio of 3.9x, which can be made available as an incremental facility. Unlimited unsecured debt is permitted subject to a 5.6x consolidated net leverage ratio (CNLR). Unlimited restricted payments are permitted if pro forma CNLR is 3.6x or lower. The obligation to repay asset sale proceeds is not subject to a leverage test. Adjustments to consolidated EBITDA include the full run rate of cost savings and synergies, capped at 25% of consolidated EBITDA and believed to be realisable within 24 months of the relevant test period. The above are proposed terms, and the final terms may be materially different. PRINCIPAL METHODOLOGY The principal methodology used in these ratings was Manufacturing published in September 2021. BUSINESS PROFILE Minimax Viking GmbH, headquartered in Bad Oldesloe, Germany, is a global operator in the active fire protection and detection market. The group serves industrial and commercial clients through the development, manufacturing and installation of tailor-made fire protection solutions that comply with various international safety standards, and offers follow-up services after system installation. Minimax Vikinghas three business segments: system integration (36% of November 2024 LTM group sales), products (32%) and service (32%). In 2024, the group's revenue amounted to EUR2.5 billion and management-adjusted EBITDA was EUR390 million. The group is majority owned (around 90%) by UK-based Intermediate Capital Group PLC, while its remaining shareholders are Minimax Viking's management and the Groos family (founders of the former Viking group). MINIMAX VIKING: S&P Affirms 'BB-' ICR, Outlook Stable ----------------------------------------------------- S&P Global Ratings affirmed its issuer 'BB-' ratings on Minimax Viking. S&P also assigned 'BB-' ratings to the new term loan B (TLB), with recovery ratings of '3'. S&P expects to withdraw the issue and recovery ratings on the existing TLBs once the transaction is completed and new debt is placed. S&P said, "The stable outlook reflects our expectation that Minimax will maintain its resilient operating performance and maintain debt to EBITDA well below 5x. We also factor in our expectation of significant positive free operating cash flow (FOCF), supported by substantial recurring business and a focus on organic growth in existing business areas. "After the refinancing transaction closes, Minimax's leverage will be slightly elevated, but we expect it will be below 5.0x in 2026. Minimax's financial sponsor, Intermediate Capital Group PLC (ICG), is looking to reinvest into the company through two new funds. ICG has been an investor in Minimax since 2006 and has been majority shareholder since 2018. The existing capital structure consisting of a EUR485 million TLB and a US$ TLB equivalent to EUR535 million will be refinanced. The sponsor aims to put in place a new EUR700 million TLB and EUR1,000 million-equivalent US$ TLB with maturities of seven years. Pro forma the transaction, Minimax will have EUR200 million cash on balance sheet (compared with EUR648.3 million as of Sept. 30, 2024), which we do not deduct from our S&P Global Ratings-adjusted debt calculation. As a part of the transaction, Minimax will upsize its revolving credit facility to EUR100 million and its guarantee facility to EUR250 million from EUR210 million. The company has never been drawn on its RCF, underpinning careful working capital management and low capital expenditure (capex) needs. We understand there will be no change to financial policy, and we do not expect any dividend payouts or acquisitions at this point. Pro forma the refinancing, S&P Global Ratings-adjusted debt will increase by about EUR684 million, resulting in debt to EBITDA of about 4.8x in 2025, reducing to 4.5x in 2026. We do not think Minimax's ownership by private equity sponsors will jeopardize its credit quality. We view the shareholders' agreement, which limits leverage at 4.8x on a reported net basis, as less aggressive than most other shareholders' agreements related to leveraged buyouts in the broader capital goods sector. This underpins the current rating, which is higher than those on most private-equity-owned entities in the sector. In line with our criteria for financial sponsor-owned companies, we do not deduct Minimax's cash holdings in our leverage calculation. Rather, we focus on gross leverage ratios. "We expect Minimax will continue to grow its sales volumes despite the mixed macroeconomic picture, with S&P Global Ratings-adjusted EBITDA margins broadly flat in 2024 and 2025. We estimate that revenues rose about 4.6% in 2024, and will further increase by 3.5%-4.5% in 2025. We think the order backlog provides sufficient visibility, with a strong order intake, 7.3% above the previous year as of November 2024 and 12.3% above the budget. This reflects the regulated nature of Minimax's products, exposure to growing markets, and high share of recuring revenues, at about 50% of total volumes. We predict revenue growth despite our anticipation of slower demand in China, and broadly flat demand in Europe in terms of volumes, considering lower construction sentiment. That said, Minimax's business is always exposed to new growing areas. For instance, after 2020, the warehouse boom was flowing into the order backlog. While this trend has now subdued, the business is benefiting from new growth in data centers. We don't expect a negative impact from U.S. tariffs as the company is well positioned in U.S. and has localized production in the region and a similar supply chain as its main US peers. We forecast S&P Global Ratings-adjusted EBITDA margins will remain stable about 14.5% in 2024 and 14.7%-15.0% in 2025. "Minimax's S&P Global Ratings-adjusted FOCF should remain strong. We estimate Minimax's FOCF was EUR195 million in 2024 and forecast EUR185 million - EUR195 million levels in 2025, thanks to careful working capital management. In our view, Minimax's relatively low capex requirement, which represents about 3%-4% of sales, and lower interest costs will lead to strong FOCF. Supported by robust cash flows and stable debt, Minimax's FOCF to debt will be 16.8% in 2024 by our estimate, and about 10%-11% in 2025." Minimax's resilient business model in a largely regulated environment and a high share of recurring revenues underpin the ratings. Minimax holds leading positions across most of its end markets, notably the No. 1 position in Germany and No. 2 in the U.S., protected by high barriers to entry due to regulation. The company estimates that about 50% of revenues stem from recurring business, which is supported by service contracts and modernization demand. Long-term contracts account for one-third of the revenue in the system integration business. These contracts provide a buffer against weaker economic conditions, allowing the company to adjust its cost base more easily. These characteristics, when combined with the large and stable service base--which is consistently about 32% of sales--contribute to business stability and profitability and support the rating. Minimax's operating performance has been resilient over the cycle, including during economic downturns such as the 2009 financial crisis and the COVID-19 pandemic in 2020. In 2009, its revenue fell by only 5%, while the adjusted EBITDA margin remained above 10%. Revenue contracted by only 3% (1.2% on a foreign exchange adjusted basis) in 2020, while the EBITDA margin even increased slightly to 12.4% from 11.9% a year earlier. S&P said, "The stable outlook reflects our expectation that Minimax's operating performance will remain resilient over the next 12-18 months, supported by a strong order intake and a high share of recurring business. This will expand revenue further and enable the company to maintain EBITDA margins above 12.5%. Furthermore, we expect Minimax's gross debt to EBITDA will remain well below 5x. We forecast positive FOCF, with FOCF to debt comfortably above 5%. The outlook also incorporates our view that the high cash balance provides room for the company to step up organic and inorganic growth opportunities without deteriorating its credit metrics. "We could lower the rating if Minimax's operating performance dips below our expectations, resulting in debt to EBITDA of more than 5x, or if cash generation weakens, with FOCF to debt going below 5%. This could occur in the event of a sharp global economic downturn that affects Minimax's end markets, a loss of service contracts, or increasing pricing pressure." A negative rating action could also occur if Minimax: -- Cannot generate meaningful FOCF over the next 12-18 months; -- Fails to post EBITDA margins of more than 12%; -- Engages in large debt-funded acquisitions; and -- Distributes significant debt-financed shareholder returns. Rating upside is limited over the next 24 months. It depends on the relationship between Minimax and its private equity owners, the company's financial policy, and, specifically, S&P's view of the likelihood of shareholders taking any action that might hurt the company's credit quality. TUI AG: Fitch Assigns 'BB' LongTerm IDR, Outlook Stable ------------------------------------------------------- Fitch Ratings has assigned TUI AG a Long-Term Issuer Default Rating (IDR) of 'BB'. The Rating Outlook is Stable. Fitch has also assigned the senior unsecured debt a 'BB' rating with a Recovery Rating of 'RR4', reflecting low prior-ranking debt. The rating reflects TUI's leading market position and strong brand recognition in the European tourism industry, and conservative leverage, balanced by high business seasonality and group structure complexity. Vertical integration into hotels, airline and tours provides TUI with differentiation and diversification benefits, although expansion of lower-margin holiday packages weighs on its profitability, which is below peers. The Stable Outlook reflects its expectation that TUI will achieve gradual EBITDA growth and increasing FCF generation over the next four years despite softened demand. Fitch assumes the company will adhere to its financial policy, with a management-calculated medium-term net leverage target well below 1x when defining its shareholder return strategy in 2025. Key Rating Drivers Leading European Tourism Group: TUI is one of the world's largest integrated tourism groups with material scale and strong brand awareness in Europe. It is well-positioned in 14 feeder markets, with some concentration on Germany and the UK. The group's operations are diversified across hotels (primarily through its fully consolidated joint venture with RIU), its own airline, cruises, tours and travel agency, where it offers differentiated holiday packages through their own online channel, mobile app and an extensive retail network. High Business Seasonality: The rating considers TUI's high business seasonality with the majority of sales and EBITDA generated in the summer. This also exposes its performance to exogenous events, such as acts of terrorism, geopolitical conflicts and other disruptions, if they occur during the peak season. Fitch estimates that intra-year quarterly working capital swings could be up to EUR1.5 billion-EUR2 billion and require TUI to draw under its revolving credit facility (RCF), increasing its gross debt. Fiscal-year end leverage is therefore not reflective of TUI's leverage throughout the year, which Fitch factors in to the company's tighter debt capacity compared with less seasonal peers. Fitch also restricts about EUR1.2 billion of cash at fiscal year ending September 2024 (FYE24), including around EUR700 million already reported as restricted by the company. Holiday Packages Weigh on Profitability: TUI's Fitch-adjusted EBITDA margin of around 5% is lower than sector peers, due to its business mix. It fully accounts for revenue and cost of holiday packages, which leads to low profit margins for this segment and dilutes the high margins of hotel and cruise operations. Fitch projects that most medium-term EBITDA growth will come from the expansion of the dynamic packaging business. Consequently, Fitch expects Fitch-adjusted EBITDA margins to remain around 5% over FY25-FY28. Positive, Sizeable FCF: In a favourable demand environment, TUI's business generates positive and sizeable FCF aided by a negative working capital position, which results from advance customer bookings and prepayments. As Fitch projects revenue to grow over FY25-FY28, inflows under working capital will support TUI's sustained positive FCF generation, together with gradually growing EBITDA. This is despite its expectation of higher capex from FY26. Ambitious Business Expansion: TUI is expanding offerings on its digitalised global platform, which integrates its products and holiday packages with third-party alternatives through dynamic packaging. This selling platform for the intermediation activity is a scalable low-risk business with potential for synergies, globalisation and cross-selling opportunities, despite intense competition from well-established global operators. Fitch assumes revenue and EBIT will grow more slowly than TUI's medium-term targets due to execution risk and softer demand for leisure travel in Europe. Modest Leverage: Fitch expects Fitch-adjusted EBITDAR leverage to decline to around 2.5x in FY25 (FY24: 2.9x). This is consistent with the 'BB' rating, given TUI's business risk profile. Fitch anticipates further deleveraging towards 2.2x over FY26-FY28 due to EBITDA growth from dynamic packaging expansion and increasing dividends from TUI's 50%-owned equity-accounted JV TUI Cruises GmbH (BB-/Stable). Planned major debt-funded projects are limited to the potential buy-back of part of the leased aircraft fleet. Fitch assumes TUI will target medium-term net leverage well below 1x (FY24: 0.8x). Complex Group Structure: The rating considers that TUI's group structure is more complex than peers due to the material JVs and deleveraging dependent on dividends from TUI Cruises combined with contained dividend payout-outs to its strategic partner in the RIU JV. Unlike management, Fitch does not include income from equity-accounted investments (TUI Cruises being the largest) into EBITDA. However, in its analysis Fitch treats the 50%-owned JV with RIU as fully consolidated (in line with the company's treatment). The RIU JV drives most of the hotels segment profits and makes a material contribution to TUI's EBIT (FY24: EUR469 million of Fitch-adjusted EBIT of EUR728 million). TUI's leverage would have been higher if Fitch proportionally consolidated this JV, or if dividend payouts to its RIU JV partner increased corresponding to the partner's attributable share of the JV's earnings, but Fitch believes that risks are captured in more stringent rating sensitivities than peers. Derivation Summary TUI does not have close Fitch-rated peers due to its vertically-integrated business model but can be compared with companies operating in the travel sector. TUI is rated one notch higher than Horizon Midco 2 Limited (The Travel Corporation, BB-/Stable), which operates guided tours and river cruises, with a particular focus on the US feeder market. TUI's higher rating results from larger scale, stronger diversification and greater financial flexibility and access to capital. TUI has the same rating as Global Business Travel Group, Inc. (GBTG, BB/Stable), a B2B travel platform, providing software and services to manage travel, expenses, meetings and events. Both companies have exposure to two main geographies (Germany and the UK as feeder markets for TUI and the US and the UK for GBTB) and one travel purpose (leisure for TUI and business for GBTG). However, GBTB's business benefits from lower seasonality, high client retention rates and long-term contracts. This gives it greater debt capacity than TUI at the 'BB' rating. TUI is rated one notch higher than its 50%-owned ocean cruise operator TUI Cruises (BB-/Stable) primarily due to a more conservative capital structure and greater financial flexibility. Fitch sees cruise operations as less risky than TUI's core holiday package business due to higher profitability and advance bookings. This explains the only one notch rating differential, despite TUI Cruises's materially higher leverage. In addition, TUI's group structure complexity negatively positions it against these companies, offsetting some of the benefits of its credit profile in comparison with peers. Key Assumptions Fitch's Key Assumptions Within Its Rating Case for the Issuer: - Low to mid single-digit revenue growth over FY25-FY28, driven mostly by growth in the dynamic packaging business - Fitch-adjusted EBITDA margin at around 5% in FY25-FY28 - Dividends from equity accounted investments net of dividends to minorities at around EUR190 million a year - Inflows under working capital at EUR190 million on average over FY25-FY28 - Capex at around EUR600 million in FY25, increasing from FY26 - No M&A - Restart of shareholder returns in FY27 RATING SENSITIVITIES Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade - EBITDAR leverage remaining above 2.5x on a sustained basis, including due to a reduction in net dividends received - Declining FCF as a result of weakening profitability or aggressive financial policy - EBITDAR fixed-charge coverage weakening towards 2.0x Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade - Positive execution of the strategy leading to sustained earnings growth alongside improving geographical diversification - EBITDAR margins trending to 10%, with FCF margins sustained in the mid-single digits - EBITDAR leverage below 2x on a sustained basis and supported by a consistent financial policy and reduced group structure complexity - EBITDAR fixed-charge coverage above 2.5x on a sustained basis Liquidity and Debt Structure At FYE24, TUI had EUR1.6 billion of Fitch-adjusted cash (after excluding EUR1.2 billion for working capital swings) and EUR1.9 million available under its RCFs (of which EUR190 million is reserved for guarantees) relative to EUR0.4 billion short-term debt maturities. Fitch forecasts an adequate liquidity position due to expected positive FCF, well-spread medium-term debt maturities and its expectation of timely extension of RCF on its maturity in July 2026. Issuer Profile TUI is a Germany-based diversified integrated tourism group, serving a mainly European customer base. Summary of Financial Adjustments Fitch has applied a multiple of 8.0x when capitalising leases attributable to TUI's hotel operations. Date of Relevant Committee 04 February 2025 MACROECONOMIC ASSUMPTIONS AND SECTOR FORECASTS Fitch's latest quarterly Global Corporates Macro and Sector Forecasts data file which aggregates key data points used in its credit analysis. Fitch's macroeconomic forecasts, commodity price assumptions, default rate forecasts, sector key performance indicators and sector-level forecasts are among the data items included. ESG Considerations TUI has an ESG Relevance Score of '4' for Group Structure due to substantial minority positions in some of its consolidated businesses as well as material contribution of equity-owned businesses to cash flows, which can lead to high underlying cash flow volatility. This has a negative impact on the credit profile, and is relevant to the ratings 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 ----------- ------ -------- Tui AG LT IDR BB New Rating senior unsecured LT BB New Rating RR4 ============= I R E L A N D ============= BARINGS EURO 2018-3: Moody's Cuts EUR10MM F Notes Rating to Caa2 ---------------------------------------------------------------- Moody's Ratings has taken a variety of rating actions on the following notes: EUR27,000,000 Class C Senior Secured Deferrable Floating Rate Notes due 2031, Upgraded to Aaa (sf); previously on May 7, 2024 Upgraded to Aa3 (sf) EUR24,000,000 Class D Senior Secured Deferrable Floating Rate Notes due 2031, Upgraded to A3 (sf); previously on May 7, 2024 Affirmed Baa3 (sf) EUR10,000,000 Class F Senior Secured Deferrable Floating Rate Notes due 2031, Downgraded to Caa2 (sf); previously on May 7, 2024 Downgraded to Caa1 (sf) Moody's have also affirmed the ratings on the following notes: EUR231,800,000 (current outstanding amount EUR82,036,057.94) Class A-1 Senior Secured Floating Rate Notes due 2031, Affirmed Aaa (sf); previously on May 7, 2024 Affirmed Aaa (sf) EUR12,200,000 (current outstanding amount EUR4,317,687.26) Class A-2 Senior Secured Fixed Rate Notes due 2031, Affirmed Aaa (sf); previously on May 7, 2024 Affirmed Aaa (sf) EUR10,000,000 Class B-1 Senior Secured Floating Rate Notes due 2031, Affirmed Aaa (sf); previously on May 7, 2024 Upgraded to Aaa (sf) EUR30,000,000 Class B-2 Senior Secured Fixed Rate Notes due 2031, Affirmed Aaa (sf); previously on May 7, 2024 Upgraded to Aaa (sf) EUR24,000,000 Class E Senior Secured Deferrable Floating Rate Notes due 2031, Affirmed Ba2 (sf); previously on May 7, 2024 Affirmed Ba2 (sf) RATINGS RATIONALE The rating upgrades on the Class C and Class D notes are primarily a result of the deleveraging of the Class A-1 and Class A-2 notes since the last rating action in May 2024. The downgrade on the rating on the Class F notes is primarily a result of the deterioration in the credit quality of the underlying collateral pool since the last rating action in May 2024. The affirmations on the ratings on the Class A-1, Class A-2, Class B-1, Class B-2 and Class 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. The credit quality has deteriorated as reflected in the deterioration in the average credit rating of the portfolio (measured by the weighted average rating factor, or WARF) and an increase in the proportion of securities from issuers with ratings of Caa1 or lower. According to the trustee report dated January 2025 [1], the WARF was 3367, compared with 3140 in the April 2024 [2] report as of the last rating action. Securities with ratings of Caa1 or lower currently make up approximately 8.75% of the underlying portfolio, versus 4.93% in April 2024. The Class A-1 and A-2 notes have paid down by approximately EUR94.5m (38.7%) since the last rating action in May 2024 and EUR157.7m (64.6%) since closing. As a result of the deleveraging, over-collateralisation (OC) has increased. According to the trustee report dated January 2025 [1] the Class A/B, Class C and Class D ratios are reported at 161.08%, 137.41%, and 121.53% compared to April 2024 [2] levels of 136.93%, 124.35%, and 114.96%, respectively. Moody's note that the January 2025 and April 2024 principal payments are not reflected in the reported OC ratios. The key model inputs Moody's use in Moody's analysis, such as par, weighted average rating factor, diversity score and the weighted average recovery rate, are based on Moody's published methodology and could differ from the trustee's reported numbers. In Moody's base case, Moody's used the following assumptions: Performing par and principal proceeds balance: EUR221,238,743 Defaulted Securities: EUR9,374,518 Diversity Score: 48 Weighted Average Rating Factor (WARF): 3100 Weighted Average Life (WAL): 3.1years Weighted Average Spread (WAS) (before accounting for Euribor floors): 3.842% Weighted Average Coupon (WAC): 4.132% Weighted Average Recovery Rate (WARR): 41.89% Par haircut in OC tests and interest diversion test: 0.43% 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 incorporate these default and recovery characteristics of the collateral pool into Moody's cash flow model analysis, subjecting them to stresses as a function of the target rating of each CLO liability it is analysing. Methodology Underlying the Rating Action: The principal methodology used in these ratings was "Moody's Global Approach to Rating Collateralized Loan Obligations" published in May 2024. Counterparty Exposure: The rating action took into consideration the notes' exposure to relevant counterparties, using the methodology "Moody's Approach to Assessing Counterparty Risks in Structured Finance" published in October 2024. 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 assume 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 Moody's other analytical groups, market factors, and judgments regarding the nature and severity of credit stress on the transactions, can influence the final rating decision. BLACKROCK CLO XIV: Fitch Assigns 'B-sf' Rating on Class F-R Notes ----------------------------------------------------------------- Fitch Ratings has assigned BlackRock European CLO XIV DAC reset notes final ratings. Entity/Debt Rating Prior ----------- ------ ----- BlackRock European CLO XIV DAC Class A XS2617110791 LT PIFsf Paid In Full AAAsf Class A-R XS2986321870 LT AAAsf New Rating Class B-1 XS2617110874 LT PIFsf Paid In Full AAsf Class B-1-R XS2986322332 LT AAsf New Rating Class B-2 XS2617111096 LT PIFsf Paid In Full AAsf Class B-2-R XS2986322845 LT AAsf New Rating Class C XS2617111336 LT PIFsf Paid In Full Asf Class C-R XS2986324973 LT Asf New Rating Class D XS2617111419 LT PIFsf Paid In Full BBB-sf Class D-R XS2986325434 LT BBB-sf New Rating Class E XS2617111500 LT PIFsf Paid In Full BB-sf Class E-R XS2986328453 LT BB-sf New Rating Class F XS2617111849 LT PIFsf Paid In Full B-sf Class F-R XS2986330608 LT B-sf New Rating Transaction Summary BlackRock European CLO XIV DAC is a securitisation of mainly senior secured obligations (at least 90%) with a component of senior unsecured, mezzanine, second-lien loans and high-yield bonds. Note proceeds have been used to refinance existing notes except the subordinated notes and to purchase a portfolio with a target par of EUR400million. The portfolio is actively managed by BlackRock Investment Management (UK) Limited (BlackRock). The collateralised loan obligation (CLO) has a 4.7-year reinvestment period and an 8.5-year weighted average life test (WAL). KEY RATING DRIVERS Average Portfolio Credit Quality (Neutral): Fitch assesses the average credit quality of obligors to be in the 'B' category. The Fitch weighted average rating factor (WARF) of the identified portfolio is 24. High Recovery Expectations (Positive): At least 90% of the portfolio comprises senior secured obligations. Fitch views the recovery prospects for these assets as more favourable than for second-lien, unsecured and mezzanine assets. The Fitch weighted average recovery rate (WARR) of the identified portfolio is 63%. Diversified Portfolio (Positive): The transaction has a top 10 obligor concentration limit at 23% and a maximum fixed-rate asset limit at 12.5%. The transaction also includes various concentration limits, including a maximum exposure to the three largest Fitch-defined industries in the portfolio at 40%. These covenants ensure that the asset portfolio will not be exposed to excessive concentration. Portfolio Management (Neutral): The transaction has a 4.7-year reinvestment period and includes reinvestment criteria similar to those of other European transactions. Fitch's analysis is based on a stressed-case portfolio with the aim of testing the robustness of the transaction structure against its covenants and portfolio guidelines. The transaction has four matrices with two effective at closing, corresponding to two fixed-rate asset limits at 5% and 12.5% respectively. The other two matrices have the same fixed-rate asset limits and are effective 18 months after closing subject to the aggregate collateral balance (defaults at Fitch collateral value) being at least at the target par. All matrices have a top 10 obligor limit at 23%. Cash Flow Modelling (Positive): The WAL used for the transaction's Fitch-stressed portfolio is reduced by 12 months from the WAL covenant. This is to account for the strict reinvestment conditions envisaged by the transaction after its reinvestment period. These include passing both the coverage tests and the Fitch 'CCC' limit test, as well as a WAL covenant that progressively steps down over time. Fitch believes these conditions would reduce the effective risk horizon of the portfolio during stress periods. RATING SENSITIVITIES Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade A 25% increase of the mean default rate (RDR) and a 25% decrease of the recovery rate (RRR) across all ratings of the identified portfolio would have no negative rating impact on the notes. Downgrades, which are based on the identified portfolio, may occur if the loss expectation is larger than initially assumed, due to unexpectedly high levels of defaults and portfolio deterioration. Due to the better metrics and shorter life of the identified portfolio than the Fitch-stressed portfolio, the class B-R, D-R and E-R notes each display a rating cushion of two notches, the class C-R notes have a cushion of three notches, and the class F-R notes have a cushion of five notches. Should the cushion between the identified portfolio and the Fitch-stressed portfolio be eroded either due to manager trading or negative portfolio credit migration, a 25% increase of the mean RDR and a 25% decrease of the RRR across all ratings of the Fitch-stressed portfolio would lead to downgrades of up to three notches each for the class A-R to E-R notes, and to below 'B-sf' for the class F-R notes. Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade A 25% reduction of the mean RDR and a 25% increase in the RRR across all ratings of the Fitch-stressed portfolio would lead to upgrades of up to five notches each for the rated notes, except for the 'AAAsf' rated notes. During the reinvestment period, upgrades, which are based on the Fitch-stressed portfolio, may occur on better-than-expected portfolio credit quality and a shorter remaining WAL test, enabling the notes to withstand larger-than-expected losses for the remaining life of the transaction. After the end of the reinvestment period, upgrades may result from stable portfolio credit quality and deleveraging, leading to higher credit enhancement and excess spread available to cover losses in the remaining portfolio. 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 has checked the consistency and plausibility of the information it has received about the performance of the asset pool and the transaction. Fitch has not reviewed the results of any third-party assessment of the asset portfolio information or conducted a review of origination files as part of its ongoing monitoring. The majority of the underlying assets or risk-presenting entities have ratings or credit opinions from Fitch and/or other nationally recognised statistical rating organisations and/or European securities and markets authority-registered rating agencies. Fitch has relied on the practices of the relevant groups within Fitch and/or other rating agencies to assess the asset portfolio information or information on the risk-presenting entities. Overall, and together with any assumptions referred to above, Fitch's assessment of the information relied upon for the agency's rating analysis according to its applicable rating methodologies indicates that it is adequately reliable. ESG Considerations Fitch does not provide ESG relevance scores for BlackRock European CLO XIV DAC. In cases where Fitch does not provide ESG relevance scores in connection with the credit rating of a transaction, programme, instrument or issuer, Fitch will disclose any ESG factor that is a key rating driver in the key rating drivers section of the relevant rating action commentary. BLACKROCK EUROPEAN IV: Moody's Ups EUR13.9MM F Notes Rating to B1 ----------------------------------------------------------------- Moody's Ratings has upgraded the ratings on the following notes issued by BlackRock European CLO IV Designated Activity Company: EUR27,000,000 Class C Senior Secured Deferrable Floating Rate Notes due 2030, Upgraded to Aaa (sf); previously on Oct 31, 2023 Upgraded to Aa3 (sf) EUR22,500,000 Class D Senior Secured Deferrable Floating Rate Notes due 2030, Upgraded to Aa2 (sf); previously on Oct 31, 2023 Upgraded to Baa1 (sf) EUR25,400,000 Class E Senior Secured Deferrable Floating Rate Notes due 2030, Upgraded to Baa3 (sf); previously on Oct 31, 2023 Affirmed Ba2 (sf) EUR13,900,000 Class F Senior Secured Deferrable Floating Rate Notes due 2030, Upgraded to B1 (sf); previously on Oct 31, 2023 Affirmed B2 (sf) Moody's have also affirmed the ratings on the following notes: EUR270,000,000 (Current outstanding amount EUR64,619,116) Class A Senior Secured Floating Rate Notes due 2030, Affirmed Aaa (sf); previously on Oct 31, 2023 Affirmed Aaa (sf) EUR38,500,000 Class B-1 Senior Secured Floating Rate Notes due 2030, Affirmed Aaa (sf); previously on Oct 31, 2023 Upgraded to Aaa (sf) EUR20,000,000 Class B-2 Senior Secured Fixed Rate Notes due 2030, Affirmed Aaa (sf); previously on Oct 31, 2023 Upgraded to Aaa (sf) BlackRock European CLO IV Designated Activity Company, issued in November 2017, is a collateralised loan obligation (CLO) backed by a portfolio of mostly high-yield senior secured European loans. The portfolio is managed by BlackRock Investment Management (UK) Limited. The transaction's reinvestment period ended in January 2022. RATINGS RATIONALE The rating upgrades on the Class C, Class D, Class E and Class F notes are primarily a result of the significant deleveraging of the Class A notes following amortisation of the underlying portfolio since the last review in August 2024. The affirmations on the ratings on the Class A, Class B-1 and Class B-2 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. The Class A notes have paid down by approximately EUR90.5 million (33.5%) since the last review in August 2024 and EUR205.4 million (76.1%) since closing. As a result of the deleveraging, over-collateralisation (OC) has increased across the capital structure. According to the trustee report dated January 2025 [1] the Class A/B, Class C, Class D, Class E and Class F OC ratios are reported at 165.35%, 141.95%, 126.97%, 113.45% and 107.21% compared to August 2024 [2] levels of 150.76%, 133.85%, 122.40%, 111.63% and 106.50%, respectively. Moody's note that the January 2025 principal payments are not reflected in the reported OC ratios. The deleveraging and OC improvements primarily resulted from high prepayment rates of leveraged loans in the underlying portfolio. Most of the prepaid proceeds have been applied to amortise the liabilities. All else held equal, such deleveraging is generally a positive credit driver for the CLO's rated liabilities. The key model inputs Moody's use in Moody's analysis, such as par, weighted average rating factor, diversity score and the weighted average recovery rate, are based on Moody's published methodology and could differ from the trustee's reported numbers. In Moody's base case, Moody's used the following assumptions: Performing par and principal proceeds balance: EUR231.3m Defaulted Securities: EUR6.2m Diversity Score: 43 Weighted Average Rating Factor (WARF): 2973 Weighted Average Life (WAL): 3.07 years Weighted Average Spread (WAS) (before accounting for Euribor floors): 3.78% Weighted Average Coupon (WAC): 3.51% Weighted Average Recovery Rate (WARR): 43.40% Par haircut in OC tests and interest diversion test: 1.404% 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 incorporate these default and recovery characteristics of the collateral pool into Moody's cash flow model analysis, subjecting them to stresses as a function of the target rating of each CLO liability it is analysing. Methodology Underlying the Rating Action: The principal methodology used in these ratings was "Moody's Global Approach to Rating Collateralized Loan Obligations" published in May 2024. 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" published in October 2024. 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. 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 assume 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 Moody's other analytical groups, market factors, and judgments regarding the nature and severity of credit stress on the transactions, can influence the final rating decision. BRIDGEPOINT IV: Fitch Assigns 'B-sf' Final Rating on Cl. F-R Notes ------------------------------------------------------------------ Fitch Ratings has assigned BridgePoint CLO IV DAC reset notes final ratings. Entity/Debt Rating Prior ----------- ------ ----- BridgePoint CLO IV DAC A XS2562485222 LT PIFsf Paid In Full AAAsf A-R XS2978487473 LT AAAsf New Rating B-1 XS2562485578 LT PIFsf Paid In Full AAsf B-2 XS2562485735 LT PIFsf Paid In Full AAsf B-R XS2978487804 LT AAsf New Rating C XS2562485909 LT PIFsf Paid In Full Asf C-R XS2978488109 LT Asf New Rating D XS2562486113 LT PIFsf Paid In Full BBB-sf D-R XS2978488364 LT BBB-sf New Rating E XS2562486386 LT PIFsf Paid In Full BB-sf E-R XS2978488521 LT BB-sf New Rating F XS2562486543 LT PIFsf Paid In Full B-sf F-R XS2978488794 LT B-sf New Rating X XS2978487390 LT AAAsf New Rating Transaction Summary Bridgepoint CLO IV DAC is a securitisation of mainly senior secured obligations (at least 90%) with a component of senior unsecured, mezzanine, second-lien loans and high-yield bonds. Note proceeds were used to refinance the existing notes except the subordinated notes and to fund a portfolio with a target par of EUR450 million. The portfolio is actively managed by Bridgepoint Credit Management Limited. The collateralised loan obligation (CLO) has a 4.5-year reinvestment period and a seven-year weighted average life (WAL) test at closing, which can be extended by one and a half years, at any time, from one and a half years after closing. KEY RATING DRIVERS Average Portfolio Credit Quality (Neutral): Fitch assesses the average credit quality of obligors at 'B'/'B-'. The Fitch-calculated weighted average rating factor (WARF) of the identified portfolio is 25.3. Strong Recovery Expectation (Positive): At least 90% of the portfolio comprises senior secured obligations. Fitch views the recovery prospects for these assets as more favourable than for second-lien, unsecured and mezzanine assets. The Fitch-calculated weighted average recovery rate (WARR) of the identified portfolio is 60.8%. Diversified Asset Portfolio (Positive): The transaction has a concentration limit for the 10 largest obligors of 21%. The transaction also includes various concentration limits, including a maximum exposure to the three-largest Fitch-defined industries in the portfolio at 40%. These covenants ensure the asset portfolio will not be exposed to excessive concentration. WAL Step-Up Feature (Neutral): The transaction can extend the WAL by one and a half years on the step-up date, which can be one and a half years after closing at the earliest. The WAL extension is at the option of the manager but subject to conditions including the collateral-quality tests satisfaction and the aggregate collateral balance (defaults at Fitch collateral value) being at least at the reinvestment target par. Portfolio Management (Neutral): The transaction has two Fitch test matrices corresponding to fixed- rate asset limits at 10% and 12.5% and a top 10 obligor limit at 21%. Both matrices correspond to a WAL test of seven years. The transaction has a 4.5-year reinvestment period and includes reinvestment criteria similar to those of other European transactions. Fitch's analysis is based on a stressed-case portfolio with the aim of testing the robustness of the transaction structure against its covenants and portfolio guidelines. Cash-flow Modelling (Neutral): The WAL used for the transaction's Fitch-stressed portfolio analysis is 12 months less than the WAL covenant at the issue date, to account for the strict reinvestment conditions envisaged by the transaction after its reinvestment period. These include passing the coverage tests, and the Fitch 'CCC' bucket limitation test post-reinvestment, as well as a WAL covenant that progressively steps down over time, both before and after the end of the reinvestment period. Fitch believes these conditions would reduce the effective risk horizon of the portfolio during stress periods. RATING SENSITIVITIES Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade A 25% increase of the mean default rate (RDR) and a 25% decrease of the recovery rate (RRR) across all ratings of the identified portfolio would have no impact on the class X notes, but would lead to downgrades of no more than one notch each for the class A, D and E notes, two notches each for the class B and C notes, and to below 'B-sf' for the class F notes. Downgrades, which are based on the identified portfolio, may occur if the loss expectation is larger than initially assumed, due to unexpectedly high levels of defaults and portfolio deterioration. Due to the better metrics of the identified portfolio than the Fitch-stressed portfolio the rated notes each display a rating cushion to downgrades of up to two notches. Should the cushion between the identified portfolio and the Fitch-stressed portfolio erode due to manager trading or negative portfolio credit migration, a 25% increase of the mean RDR and a 25% decrease of the RRR across all ratings of the Fitch-stressed portfolio would have no impact on the class X notes, but would result in downgrades of up to four notches each for the class A to E notes, and to below 'B-sf' for the class F notes. Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade A 25% reduction of the mean RDR and a 25% increase in the RRR across all ratings of the Fitch-stressed portfolios would lead to upgrades of no more than three notches each for the rated notes of the transaction, except for the 'AAAsf' notes. During the reinvestment period, upgrades, based on the Fitch-stressed portfolio, may occur on better-than-expected portfolio credit quality and a shorter remaining WAL test, allowing the notes to withstand larger-than-expected losses for the remaining life of the transaction. After the end of the reinvestment period, upgrades may result from stable portfolio credit quality and deleveraging, leading to higher credit enhancement and excess spread available to cover losses in the remaining portfolio. 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 has checked the consistency and plausibility of the information it has received about the performance of the asset pool and the transaction. Fitch has not reviewed the results of any third-party assessment of the asset portfolio information or conducted a review of origination files as part of its ongoing monitoring. The majority of the underlying assets or risk-presenting entities have ratings or credit opinions from Fitch and/or other nationally recognised statistical rating organisations and/or European securities and markets authority-registered rating agencies. Fitch has relied on the practices of the relevant groups within Fitch and/or other rating agencies to assess the asset portfolio information or information on the risk-presenting entities. Overall, and together with any assumptions referred to above, Fitch's assessment of the information relied upon for the agency's rating analysis according to its applicable rating methodologies indicates that it is adequately reliable. ESG Considerations Fitch does not provide ESG relevance scores for BridgePoint CLO IV DAC. In cases where Fitch does not provide ESG relevance scores in connection with the credit rating of a transaction, programme, instrument or issuer, Fitch will disclose any ESG factor that is a key rating driver in the key rating drivers section of the relevant rating action commentary. CARLYLE EURO 2021-2: Fitch Hikes Rating on Class D Notes to 'BBsf' ------------------------------------------------------------------ Fitch Ratings has upgraded Carlyle Euro 2021-2 DAC class D notes, and affirmed the rest. Entity/Debt Rating Prior ----------- ------ ----- Carlyle Euro CLO 2021-2 DAC A-1 XS2391833287 LT AAAsf Affirmed AAAsf A-2A XS2391833360 LT AAsf Affirmed AAsf A-2B XS2391833444 LT AAsf Affirmed AAsf B XS2391833527 LT Asf Affirmed Asf C XS2391833873 LT BBB-sf Affirmed BBB-sf D XS2391833790 LT BBsf Upgrade BB-sf E XS2391833956 LT B-sf Affirmed B-sf Transaction Summary Carlyle Euro 2021-2 DAC is a cash flow CLO comprising mostly senior secured obligations. The transaction will exit its reinvestment period in April 2026 and the portfolio is actively managed by CELF Advisors LLP. KEY RATING DRIVERS Stable Performance: Since Fitch's last review in April 2024, the portfolio's performance has remained stable. Based on the last trustee report dated 3 January 2025, the transaction was passing all of its collateral-quality and portfolio-profile tests. The transaction is currently 0.5% below its target par, but remains below its rating case assumptions. Exposure to assets with a Fitch-derived rating of 'CCC+' and below is currently 5.7%, according to the trustee, compared with a limit of 7.5%. The transaction also currently has no defaulted assets in the portfolio. The upgrade reflects its comfortable default-rate buffer supporting the class D notes rating, which should be capable absorbing further defaults in the portfolio. Limited Refinancing Risk: The transaction has limited near- and medium-term refinancing risk, with 2.4% of the assets in the portfolio maturing by end-2026, as calculated by Fitch. B/B- Portfolio: Fitch assesses the average credit quality of the underlying obligors at B/B-. The Fitch-calculated weighted average rating factor (WARF) of the current portfolio is 25.2. High Recovery Expectations: Senior secured obligations comprise 100% of the portfolio. Fitch views the recovery prospects for these assets as more favorable than for second-lien, unsecured and mezzanine assets. The Fitch-calculated weighted average recovery rate (WARR) of the current portfolio is 61.8%. Diversified Portfolio: The portfolio is well-diversified across obligors, countries and industries. The top 10 obligor concentration, as calculated by Fitch, is 10.2%, and no obligor represents more than 1.3% of the portfolio balance. Exposure to the three-largest Fitch-defined industries is 22.5%, as calculated by the trustee. Fixed-rate assets reported by the trustee are at 8.3% of the portfolio balance, which is within the current limit of 12.5% Transaction Within Reinvestment Period: The transaction is within its reinvestment period until April 2026. In addition, after the reinvestment period, the manager can continue to reinvest unscheduled principal proceeds and sale proceeds from credit-risk obligations, subject to compliance with the reinvestment criteria. Given the manager's ability to reinvest, Fitch's analysis is based on a portfolio where Fitch stresses the transaction's covenants to their limits. RATING SENSITIVITIES Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade Downgrades may occur if the build-up of the notes' credit enhancement following amortisation does not compensate for a larger loss expectation than initially assumed, due to unexpectedly high levels of defaults and portfolio deterioration. Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade Upgrades may occur if the portfolio quality remains stable and the notes start amortising, leading to higher credit enhancement across the capital structure. 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 has checked the consistency and plausibility of the information it has received about the performance of the asset pool and the transaction. Fitch has not reviewed the results of any third-party assessment of the asset portfolio information or conducted a review of origination files as part of its ongoing monitoring. The majority of the underlying assets or risk-presenting entities have ratings or credit opinions from Fitch and/or other nationally recognised statistical rating organisations and/or european securities and markets authority-registered rating agencies. Fitch has relied on the practices of the relevant groups within Fitch and/or other rating agencies to assess the asset portfolio information or information on the risk-presenting entities. Overall, and together with any assumptions referred to above, Fitch's assessment of the information relied upon for the agency's rating analysis according to its applicable rating methodologies indicates that it is adequately reliable. ESG Considerations Fitch does not provide ESG relevance scores for Carlyle Euro CLO 2021-2 DAC. In cases where Fitch does not provide ESG relevance scores in connection with the credit rating of a transaction, programme, instrument or issuer, Fitch will disclose any ESG factor that is a key rating driver in the key rating drivers section of the relevant rating action commentary. CVC CORDATUS XVI: Fitch Affirms 'Bsf' Rating on Class F Debt ------------------------------------------------------------ Fitch Ratings has revised CVC Cordatus Loan Fund XVI DAC class B, C-1, C-2, E and F notes Outlook to Positive from Stable and affirmed all notes. Entity/Debt Rating Prior ----------- ------ ----- CVC Cordatus Loan Fund XVI DAC A-1 XS2078646093 LT AAAsf Affirmed AAAsf A-2 XS2078646689 LT AAAsf Affirmed AAAsf B XS2078647497 LT AAsf Affirmed AAsf C-1 XS2078647901 LT Asf Affirmed Asf C-2 XS2078648545 LT Asf Affirmed Asf D XS2078649436 LT BBBsf Affirmed BBBsf E XS2078649782 LT BBsf Affirmed BBsf F XS2078650103 LT Bsf Affirmed Bsf Transaction Summary CVC Cordatus Loan Fund XVI DAC is a cash flow CLO comprising mostly senior secured obligations. The transaction exited its reinvestment period in June 2024 and the portfolio is actively managed by CVC Credit Partners European CLO Management LLP. KEY RATING DRIVERS Large Cushion Supports Positive Outlooks: All notes have large default-rate buffers to support their ratings and should be capable of absorbing further defaults in the portfolio. Fitch expects the notes to build sufficient credit protection to withstand potential deterioration in portfolio credit quality, supporting the Positive Outlooks. Continued stable performance, coupled with potential deleveraging and a shortening risk horizon, would lead to an upgrade of these notes. 'B'/'B-' Portfolio: Fitch assesses the average credit quality of the underlying obligors at 'B'/'B-'. The Fitch-calculated weighted average rating factor (WARF) of the current portfolio is 26.7 under its latest criteria, up from 25.8 in April 2024. High Recovery Expectations: Senior secured obligations comprised 95% of the portfolio, according to the latest trustee report dated 5 December 2024. Fitch views the recovery prospects for these assets as more favourable than for second-lien, unsecured and mezzanine assets. The Fitch-calculated weighted average recovery rate (WARR) of the current portfolio was 58.3%, versus 60.6% in April 2024. Stable Performance: According to the last trustee report, the transaction was passing all its collateral-quality and portfolio-profile tests. The portfolio has approximately EUR0.7 million of defaulted assets. Diversified Portfolio: The portfolio is well-diversified across obligors, countries and industries. The top 10 obligor concentration, as calculated by Fitch, is 14.8%, and no obligor represents more than 1.7% of the portfolio balance. Exposure to the three-largest Fitch-defined industries was 29.2% as reported by the trustee. Fixed-rate assets as reported by the trustee were 12.4% of the portfolio balance, just under its limit of 12.5%. Deviation from MIRs: The class B to F notes are one notch below their model-implied ratings (MIRs), while the class A-1 and A-2 notes are in line with their MIRs. The deviations reflect still insufficient cushions at their MIRs and uncertain macro-economic conditions that may result in a deteriorating portfolio credit profile. Transaction Out of Reinvestment Period: The transaction exited its reinvestment period in June 2024. The manager continues to reinvest unscheduled principal proceeds and sale proceeds from credit-risk obligations, in compliance with the reinvestment criteria, but has managed to use some proceeds to repay senior notes, thereby deleveraging the capital structure. Given the manager's ability to reinvest, Fitch's analysis is based on a portfolio where Fitch has stressed the transaction's covenants to their limits. RATING SENSITIVITIES Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade Based on the current portfolio, downgrades may occur if the loss expectation is larger than initially assumed, due to unexpectedly high levels of default and portfolio deterioration. Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade Upgrades may result from stable portfolio credit quality and deleveraging, leading to higher credit enhancement and excess spread available to cover losses in the remaining portfolio. 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 has checked the consistency and plausibility of the information it has received about the performance of the asset pool and the transaction. Fitch has not reviewed the results of any third-party assessment of the asset portfolio information or conducted a review of origination files as part of its ongoing monitoring. The majority of the underlying assets or risk-presenting entities have ratings or credit opinions from Fitch and/or other nationally recognised statistical rating organisations and/or European securities and markets authority-registered rating agencies. Fitch has relied on the practices of the relevant groups within Fitch and/or other rating agencies to assess the asset portfolio information or information on the risk-presenting entities. Overall, and together with any assumptions referred to above, Fitch's assessment of the information relied upon for the agency's rating analysis according to its applicable rating methodologies indicates that it is adequately reliable. ESG Considerations Fitch does not provide ESG relevance scores for CVC Cordatus Loan Fund XVI DAC. In cases where Fitch does not provide ESG relevance scores in connection with the credit rating of a transaction, programme, instrument or issuer, Fitch will disclose any ESG factor that is a key rating driver in the key rating drivers section of the relevant rating action commentary. JUBILEE CLO 2025-XXX: Fitch Assigns B-(EXP)sf Rating on Cl. F Notes ------------------------------------------------------------------- Fitch Ratings has assigned Jubilee CLO 2025-XXX DAC notes expected ratings. The assignment of final ratings is contingent on the receipt of final documents confirming to information already reviewed. Entity/Debt Rating ----------- ------ Jubilee CLO 2025-XXX DAC Class A-1 LT AAA(EXP)sf Expected Rating Class A-2 LT AAA(EXP)sf Expected Rating Class B-1 LT AA(EXP)sf Expected Rating Class B-2 LT AA(EXP)sf Expected Rating Class C LT A(EXP)sf Expected Rating Class D-1 LT BBB-(EXP)sf Expected Rating Class D-2 LT BBB-(EXP)sf Expected Rating Class E LT BB-(EXP)sf Expected Rating Class F LT B-(EXP)sf Expected Rating Subordinated Notes LT NR(EXP)sf Expected Rating Transaction Summary Jubilee CLO 2025-XXX DAC is a securitisation of mainly senior secured obligations (at least 96%) with a component of senior unsecured, mezzanine, second-lien loans and high-yield bonds. Note proceeds will be used to fund a portfolio with a target par of EUR550 million. The portfolio is actively managed by Alcentra Ltd. The CLO has an about 4.5-year reinvestment period and a 7.5 year weighted average life (WAL) test limit. KEY RATING DRIVERS Average Portfolio Credit Quality (Neutral): Fitch places the average credit quality of obligors in the identified portfolio at 'B'/'B-'. The Fitch weighted average rating factor of the identified portfolio is 24.8. High Recovery Expectations (Positive): At least 96% of the portfolio will comprise senior secured obligation. Fitch views the recovery prospects for these assets as more favourable than for second-lien, unsecured and mezzanine assets. The Fitch weighted average recovery rate of the identified portfolio is 63.1%. Diversified Asset Portfolio (Positive): The transaction will include various concentration limits in the portfolio, including a fixed-rate obligation limit at 12.5%, a top 10 obligor concentration limit at 20%, and maximum exposure to the three-largest Fitch-defined industries in the portfolio at 40%. These covenants ensure that the asset portfolio will not be exposed to excessive concentration. Portfolio Management (Neutral): The transaction will have an approximately 4.5-year reinvestment period and include reinvestment criteria similar to those of other European transactions. Fitch's analysis is based on a stressed-case portfolio with the aim of testing the robustness of the transaction structure against its covenants and portfolio guidelines. WAL Step-Up Feature (Neutral): The transaction can extend the WAL by one year, to 8.5 years from closing, on or after the step-up date. The WAL extension will be subject to conditions including satisfying the collateral quality tests and the adjusted collateral balance being at least equal to the reinvestment target par. Cash Flow Modelling (Neutral): The WAL used for the Fitch-stressed portfolio was 12 months less than the WAL covenant to account for structural and reinvestment conditions after the reinvestment period, including passing the over-collateralisation and Fitch 'CCC' limitation tests, and a WAL covenant that progressively steps down over time, both before and after the end of the reinvestment period. In Fitch's opinion, these conditions reduce the effective risk horizon of the portfolio during the stress period. RATING SENSITIVITIES Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade A 25% increase of the mean default rate (RDR) across all ratings and a 25% decrease of the recovery rate (RRR) across all ratings of the identified portfolio would lead to one-notch downgrades for the class B-1, B-2, C, D-1 and D-2 notes, and have no impact on the other classes. Based on the identified portfolio, downgrades may occur if the loss expectation is larger than initially assumed, due to unexpectedly high levels of defaults and portfolio deterioration. Due to the better metrics and shorter life of the identified portfolio than the Fitch-stressed portfolio, the class B-1, B-2, C, D-1, D-2, E notes have a rating cushion of two notches, the class F notes have a rating cushion of four notches, and the class A-1 and A-2 notes have no rating cushion as they are already at the highest achievable rating. Should the cushion between the identified portfolio and the Fitch-stressed portfolio be eroded either due to manager trading or negative portfolio credit migration, a 25% increase of the mean RDR across all ratings and a 25% decrease of the RRR across all ratings of the Fitch-stressed portfolio would lead to downgrades of up to four notches for the class A-1 to E notes, and to below 'Bsf' for the class F notes. Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade A 25% reduction of the RDR across all ratings and a 25% increase in the RRR across all ratings of the Fitch-stressed portfolio would lead to upgrades of up to five notches for the rated notes, except for the 'AAAsf' rated notes, which are at the highest level on Fitch's scale and cannot be upgraded. During the reinvestment period, based on the Fitch-stressed portfolio, upgrades may occur on better-than-expected portfolio credit quality and a shorter remaining WAL test, allowing the notes to withstand larger-than-expected losses for the remaining life of the transaction. After the end of the reinvestment period, upgrades may result from stable portfolio credit quality and deleveraging, leading to higher credit enhancement and excess spread available to cover losses in the remaining portfolio. 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 Jubilee CLO 2025-XXX DAC The majority of the underlying assets or risk presenting entities have ratings or credit opinions from Fitch and/or other Nationally Recognized Statistical Rating Organizations and/or European Securities and Markets Authority registered rating agencies. Fitch has relied on the practices of the relevant groups within Fitch and/or other rating agencies to assess the asset portfolio information or information on the risk presenting entities. 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 Fitch does not provide ESG relevance scores for Jubilee CLO 2025-XXX DAC. In cases where Fitch does not provide ESG relevance scores in connection with the credit rating of a transaction, programme, instrument or issuer, Fitch will disclose any ESG factor that is a key rating driver in the key rating drivers section of the relevant rating action commentary. NASSAU EURO II: Fitch Assigns 'B-sf' Final Rating on Cl. F-R Notes ------------------------------------------------------------------ Fitch Ratings has assigned Nassau Euro CLO II DAC reset notes final ratings. Entity/Debt Rating Prior ----------- ------ ----- Nassau Euro CLO II DAC A XS2556942949 LT PIFsf Paid In Full AAAsf A-R XS2978734668 LT AAAsf New Rating AAA(EXP)sf B-1 XS2556943160 LT PIFsf Paid In Full AAsf B-2 XS2556943327 LT PIFsf Paid In Full AAsf B-R XS2978734825 LT AAsf New Rating AA(EXP)sf C XS2556943673 LT PIFsf Paid In Full A+sf C-R XS2978735475 LT Asf New Rating A(EXP)sf D XS2556943830 LT PIFsf Paid In Full BBB+sf D-R XS2978735715 LT BBB-sf New Rating BBB-(EXP)sf E XS2556944051 LT PIFsf Paid In Full BB-sf E-R XS2978735988 LT BB-sf New Rating BB-(EXP)sf F XS2556944218 LT PIFsf Paid In Full B-sf F-R XS2978736101 LT B-sf New Rating B-(EXP)sf Transaction Summary Nassau Euro CLO II DAC is a securitisation of mainly senior secured obligations with a component of senior unsecured, mezzanine, second-lien loans and high-yield bonds. Note proceeds have been used to redeem the existing notes, except the subordinated notes, and to fund the existing portfolio. The portfolio is actively managed by Nassau Global Credit (UK) LLP (Nassau). The collateralised loan obligation (CLO) has a 4.7-year reinvestment period and an 8.7-year weighted average life test (WAL test). KEY RATING DRIVERS Average Portfolio Credit Quality (Neutral): Fitch assesses the average credit quality of obligors at 'B'/ 'B-'. The Fitch weighted average rating factor of the identified portfolio is 25.3. High Recovery Expectations (Positive): At least 92.5% of the portfolio comprises senior secured obligations. Fitch views the recovery prospects for these assets as more favourable than for second-lien, unsecured and mezzanine assets. The Fitch weighted average recovery rate of the identified portfolio is 63.7%. Diversified Portfolio (Positive): The transaction includes four Fitch matrices. Two are effective at closing, corresponding to an 8.7-year WAL, while two are effective one year after closing, corresponding to a 7.7-year WAL. Each matrix set corresponds to two different fixed-rate asset limits at 5.5% and 10%. All matrices are based on a top-10 obligor concentration limit at 20%. The transaction has a maximum exposure to the three-largest Fitch-defined industries in the portfolio at 40%, among others. These covenants ensure the asset portfolio will not be exposed to excessive concentration. Portfolio Management (Neutral): The transaction has a reinvestment period of approximately 4.7 years and includes reinvestment criteria similar to those of other European transactions. Fitch's analysis is based on a stressed-case portfolio with the aim of testing the robustness of the transaction structure against its covenants and portfolio guidelines. Cash Flow Modelling (Positive): The WAL used for the Fitch-stressed portfolio analysis is 12 months less than the WAL covenant. This reduction to the risk horizon accounts for the strict reinvestment conditions envisaged by the transaction after its reinvestment period. These include passing both the coverage tests and the Fitch 'CCC' bucket limitation test post reinvestment, as well as a WAL covenant that progressively steps down over time, both before and after the end of the reinvestment period. Fitch believes these conditions would reduce the effective risk horizon of the portfolio during stress periods. RATING SENSITIVITIES Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade A 25% increase of the mean default rate (RDR) and a 25% decrease of the recovery rate (RRR) across all ratings of the identified portfolio would have no impact on the class A-R, B-R, C-R, E-R and F-R notes and would lead to a downgrade of one notch for the class D-R notes. Downgrades, which are based on the identified portfolio, may occur if the loss expectation is larger than initially assumed, due to unexpectedly high levels of default and portfolio deterioration. Due to the better metrics and shorter life of the identified portfolio than the Fitch-stressed portfolio, the class B-R, D-R, and E-R notes each display a rating cushion of two notches. The class C-R and F-R notes each have a cushion of three notches. Should the cushion between the identified portfolio and the Fitch-stressed portfolio be eroded either due to manager trading or negative portfolio credit migration, a 25% increase of the mean RDR and a 25% decrease of the RRR across all ratings of the Fitch-stressed portfolio would lead to downgrades of up to four notches each for the class A-R, B-R and C-R notes, three notches for the class D-R notes, and to below 'B-sf' for the class E-R and F-R notes. Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade A 25% reduction of the mean RDR and a 25% increase in the RRR across all ratings of the Fitch-stressed portfolio would lead to upgrades of up to two notches each for the class B-R, C-R and D-R notes, and up to three notches each for the class E-R and F-R notes. The class A-R notes are already rated 'AAAsf' and cannot be upgraded further. During the reinvestment period, upgrades, which are based on the Fitch-stressed portfolio, may occur on better-than-expected portfolio credit quality and a shorter remaining WAL test, allowing the notes to withstand larger-than-expected losses for the remaining life of the transaction. After the end of the reinvestment period, upgrades, except for the 'AAAsf' notes, may result from stable portfolio credit quality and deleveraging, leading to higher credit enhancement and excess spread available to cover losses in the remaining portfolio. 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 has checked the consistency and plausibility of the information it has received about the performance of the asset pool and the transaction. Fitch has not reviewed the results of any third-party assessment of the asset portfolio information or conducted a review of origination files as part of its ongoing monitoring. The majority of the underlying assets or risk-presenting entities have ratings or credit opinions from Fitch and/or other nationally recognised statistical rating organisations and/or European securities and markets authority-registered rating agencies. Fitch has relied on the practices of the relevant groups within Fitch and/or other rating agencies to assess the asset portfolio information or information on the risk-presenting entities. Overall, and together with any assumptions referred to above, Fitch's assessment of the information relied upon for the agency's rating analysis according to its applicable rating methodologies indicates that it is adequately reliable. ESG Considerations Fitch does not provide ESG relevance scores for Nassau Euro CLO II DAC. In cases where Fitch does not provide ESG relevance scores in connection with the credit rating of a transaction, programme, instrument or issuer, Fitch will disclose any ESG factor that is a key rating driver in the key rating drivers section of the relevant rating action commentary. SOUND POINT VI: Fitch Hikes Rating on Class E Notes to 'BBsf' ------------------------------------------------------------- Fitch Ratings has upgraded Sound Point Euro CLO VI Funding DAC class E notes and affirmed the rest. The Outlooks are Stable. Entity/Debt Rating Prior ----------- ------ ----- Sound Point Euro CLO VI Funding DAC Class A XS2381149694 LT AAAsf Affirmed AAAsf Class B1 XS2381150437 LT AAsf Affirmed AAsf Class B2 XS2381151161 LT AAsf Affirmed AAsf Class C XS2381151831 LT Asf Affirmed Asf Class D XS2381152565 LT BBB-sf Affirmed BBB-sf Class E XS2381152649 LT BBsf Upgrade BB-sf Class F XS2381152722 LT B-sf Affirmed B-sf Transaction Summary Sound Point Euro CLO VI Funding DAC is a cash flow CLO comprising mostly senior secured obligations. The transaction is actively managed by Sound Point CLO C-MOA, LLC (SPCM) and will exit its reinvestment period in October 2026. KEY RATING DRIVERS Improved Performance: The transaction is only 0.03% below its target par, with a collateral balance EUR1 million higher than at the last review in March 2024. According to the last trustee report dated 2 January 2025, the transaction was passing all of its collateral-quality and portfolio-profile tests. The transaction has no defaulted assets. Exposure to assets with a Fitch-derived rating of 'CCC+' and below is 4.4%, as calculated by trustee, versus a limit of 7.5%. Large Cushion Supports Stable Outlooks: All notes have large default-rate buffers to support their ratings and should be capable of absorbing further defaults in the portfolio. The ratings also reflect sufficient credit protection to withstand potential deterioration in the credit quality of the portfolio at their ratings. 'B'/'B-' Portfolio: Fitch assesses the average credit quality of the underlying obligors at 'B'/'B-'. The weighted average rating factor (WARF) of the current portfolio is 25.8 as calculated by Fitch under its latest criteria. High Recovery Expectations: Senior secured obligations comprise 99.4% of the portfolio. Fitch views the recovery prospects for these assets as more favourable than for second-lien, unsecured and mezzanine assets. The Fitch-calculated weighted average recovery rate (WARR) of the current portfolio is 62.2%. Diversified Portfolio: The portfolio is well-diversified across obligors, countries and industries. The top 10 obligor concentration, as calculated by Fitch, is 9.7%, and no obligor represents more than 1.1% of the portfolio balance. Exposure to the three-largest Fitch-defined industries is 31.7% as reported by the trustee. Fixed-rate assets reported by the trustee is 6.1% of the portfolio balance, versus the transaction's limit of 10%. Transaction Inside Reinvestment Period: The transaction is in its reinvestment period until October 2026, and the manager can reinvest unscheduled principal proceeds and sale proceeds from credit- improved obligations and credit-risk obligations after the reinvestment period, subject to compliance with the reinvestment criteria. Given the manager's ability to reinvest, Fitch's analysis is based on a portfolio where Fitch stressed the ratings across the Fitch matrix, since the portfolio can still migrate to different collateral-quality tests. RATING SENSITIVITIES Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade Downgrades may occur if the build-up of the notes' credit enhancement following amortisation does not compensate for a larger loss expectation than initially assumed, due to unexpectedly high levels of defaults and portfolio deterioration. Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade Upgrades may result from stable portfolio credit quality and deleveraging, leading to higher credit enhancement and excess spread available to cover losses in the remaining portfolio. 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 has checked the consistency and plausibility of the information it has received about the performance of the asset pool and the transaction. Fitch has not reviewed the results of any third-party assessment of the asset portfolio information or conducted a review of origination files as part of its ongoing monitoring. The majority of the underlying assets or risk-presenting entities have ratings or credit opinions from Fitch and/or other nationally recognised statistical rating organisations and/or European securities and markets authority-registered rating agencies. Fitch has relied on the practices of the relevant groups within Fitch and/or other rating agencies to assess the asset portfolio information or information on the risk-presenting entities. Overall, and together with any assumptions referred to above, Fitch's assessment of the information relied upon for the agency's rating analysis according to its applicable rating methodologies indicates that it is adequately reliable. ESG Considerations Fitch does not provide ESG relevance scores for Sound Point Euro CLO VI Funding DAC. In cases where Fitch does not provide ESG relevance scores in connection with the credit rating of a transaction, programme, instrument or issuer, Fitch will disclose any ESG factor that is a key rating driver in the key rating drivers section of the relevant rating action commentary. SPINNAKER DEBTCO: S&P Raises LongTerm ICR to 'B', Outlook Stable ---------------------------------------------------------------- S&P Global Ratings raised its long-term issuer credit rating on specialty pharma company Norgine's parent, Spinnaker Debtco Ltd., and its issue rating on the upsized and fully converted into euros, as part of the overall add-on transaction, EUR800 million term loan, due 2031, to 'B' from 'B-'. The recovery rating on the loan is unchanged at '3', with a rounded recovery estimate of 55% in the event of payment default. The stable outlook reflects S&P's forecast that Norgine will maintain strong revenue growth in the next 12-18 months while reaping the benefits from its operational excellence program. This should significantly strengthen its EBITDA margins to materially above 20%, supporting positive FOCF generation and EBITDA interest coverage of above 2x. The upgrade reflects Norgine's solid underlying business momentum, bolstered by its plan to augment Movicol's sales channels and by its operational excellence program. Norgine reported 7% net sales growth (excluding royalty income) in 2024, which was above our base-case expectation of 5%-6% and reflected the product portfolio's broad-based momentum. S&P sees strong signs that the company will expand its key laxative brand, Movicol (44% of total 2024 net sales) and widen its share of over-the-counter (OTC) sales in key countries, with overall net sales growth of 9%. In 2024, as anticipated, Norgine launched active media campaigns in most of its end markets (except in Belgium, Austria, and Portugal), successfully de-reimbursed Movicol in France, and received general sales list status for the drug in the U.K., allowing it to be sold in direct-to-consumer channels without pharmacist supervision. In the U.K., Germany, and France, Norgine also amended Movicol's distribution channel. Elsewhere in the portfolio, Xifaxan (indicated for hepatic encephalopathy; about 18% of net sales), the in-licensed second-highest selling drug, grew strongly by 15% year-on-year, particularly driven by the U.K. and German markets, with a one-time effect of normalized wholesaler destocking in the former. The third growth factor, the bowel preparation franchise (18% of net sales in 2024), expanded solidly by about 8%, driven by the ongoing intentional switch to the more efficient Plenvu brand from Moviprep. These factors helped offset additional launch costs from new products including in-licensed Pedmarqsi (indicated for reducing the risk of cisplatin-induced hearing loss in pediatric patients with localized, non-metastatic solid tumors). This--combined with management's decision to spread the cost of the capital investment linked to the rollout of Movicol's new stick pack lines and the extension of the production line of Plenvu over two years--translated into our estimate of slightly positive FOCF of close to EUR5 million (versus our previous forecast of EUR20 million outflows). S&P said, "We forecast Norgine will maintain strong revenue growth of about 7%-8% per year in 2025-2026 with continued profit margin expansion that should help sustain positive FOCF and improve EBITDA interest coverage above 2x. We forecast Movicol's revenue will continue to increase strongly by close to 10% in 2025 and 2026. We further assume the bowel preparation franchise and Xifaxan will continue to post solid growth rates of 5%-10%. For the bowel prep franchise growth rate is underpinned by the ongoing switch to Plenvu from Moviprep in the former and penetration for key indications in the latter in the end markets. We expect Norgine to complete its operational excellence program in 2025 with a final associated cost payment of about EUR12 million-EUR13 million--a material reduction from the peak of about EUR30 million in 2024. Associated cost savings and ongoing strong revenue growth should therefore improve adjusted EBITDA margins to 22%-23% (from the about 18.3% estimated in 2024). Our expectations for improved EBITDA interest coverage to above 2x also stems from the lower interest costs following the full conversion to euros of the term loan tranches that were denominated in Australian dollars and British pound sterling that the company completed alongside the add-on transaction. Cost savings from these actions should help offset the corresponding interest costs from the incremental EUR125 million tranche add-on. In addition--notwithstanding the company's decision to spread the cost of the new Movicol stick pack lines, resulting in higher-than-expected capex of about EUR38 million--we forecast the company will maintain positive FOCF of close to EUR10 million with adjusted debt to EBITDA trending toward 6x in 2025 and below in 2026. "We anticipate that Norgine will continue to actively in-license products, however, we assume management and owners will maintain a prudent stance toward discretionary spending, translating into relatively stable credit metrics. Norgine has recently accelerated its product in-licensing activity. This is notably linked to the in-licensing of Pedmarqsi in 2024 and Mavorixafor -- for the treatment of a rare immunodeficiency syndrome: warts, hypogammaglobulinemia, infections, and myelokathexis (WHIM) -- in early 2025. That said, we view these transactions as manageable from an overall credit quality perspective, given Norgine's underlying existing product portfolio performance. The transactions were consistent with the group's previously communicated strategy of targeting niche products that are adjacent to its existing therapeutic areas and markets (Europe, Australia, and New Zealand), where there is less risk of competition from larger, better capitalized pharma companies. This strategy helps to generate reasonable transaction valuations. We also note that the overall growth dynamics of Norgine's existing product portfolio are such that the company does not depend on external transactions to drive growth, which allows management to focus on integration. We therefore believe that management and controlling owners (Goldman Sachs Asset Management) will maintain a prudent stance toward discretionary spending, such that Norgine will maintain stable credit metrics at the current projected levels, which we see as commensurate with the ratings. "Despite scant patent protection in the overall product portfolio, Norgine should continue to enjoy robust organic growth prospects in the next two to three years. For example, we note Movicol's established track record of expansion over the past 25 years, despite scarce patent protection (only on the liquid form; about 1% of sales) and alternative products in the market. This is thanks to Movicol's relatively complex composition, proven safety profile, strong recognition by key prescribers (general practitioners and gastroenterologists), and limited competition from large pharmaceutical companies that do not focus on similar (osmotic) laxatives. The company is currently levering on these strengths to promote Movicol in the OTC sales channel. We also see growth arising from other parts of Norgine's portfolio, with Xifaxan's latest patent protection lasting until 2029. Within bowel preparation products, the group is promoting its more effective and premium one-liter polyethylene glycol (PEG) product Plenvu, which is patent-protected until 2033. The patent on Moviprep (a two-liter PEG) expired in 2023 and is therefore open to competition from generic versions, though none have entered the market yet. In 2024, Norgine launched Agilus, a new more-efficient formulation (reduced preparation time and fluid volume required) of legacy product Dantrium, first developed in 1967, for the treatment of malignant hyperthermia (a rare and life-threatening reaction to anesthesia). Apart from the recently in-licensed products, Pedmarqsi and Mavorixafor, revenue growth in the coming years will also benefit from the expected launch of in-licensed drug DFMO (for high-risk neuroblastoma) in 2025, following submission for approval to the European Medicines Agency in 2024 and Agilus' launch in Europe in 2024." The stable outlook reflects our forecast that Norgine will maintain strong revenue growth in the next 12-18 months while reaping the benefits from its operational excellence program. This should result in significant strengthening of EBITDA margins to materially above 20%, supporting positive FOCF generation and EBITDA interest coverage of above 2x. S&P said, "We could lower the ratings on Norgine if we observe a slowdown in operational momentum, likely stemming from increased competition around key brands in the product portfolio, notably Movicol, in key geographies. This would likely translate into weaker EBITDA generation such that FOCF generation turned negative and EBITDA interest coverage dropped sustainably below 2x. "Additionally, we would view negatively any material debt-funded acquisitions that could derail deleveraging prospects, while the group is executing its business plan on Movicol and its operational excellent program, as well as investing in upcoming new product launches, notably Pedmarqsi and Mavorixafor. "We could consider raising the ratings on Norgine if the company is on track to significantly outperform our base case, translating into stronger margins and cash flows that result in adjusted debt to EBITDA comfortably below 5x." This could occur if Movicol posted higher sales through the OTC channel in key Western European markets, alongside strong sales growth in the rest of the group's product portfolio with material additional cost savings from the operational excellence program. An upgrade would also hinge on a commitment of the owners and management, and establishment of a track record, of sustainably maintaining such credit metrics. ========= I T A L Y ========= 4MORI SARDEGNA: DBRS Confirms B Rating on Class A Notes ------------------------------------------------------- DBRS Ratings GmbH took the following credit rating actions on the notes issued by 4Mori Sardegna S.r.l. (the Issuer): -- Class A confirmed at B (sf) -- Class B downgraded to CC (sf) from CCC (sf) Morningstar DBRS also changed the trend on the Class A notes to Stable from Negative and removed the Negative trend from the Class B notes' credit rating. The transaction represents the issuance of Class A, Class B, and Class J notes (collectively, the Notes). The credit rating on the Class A notes addresses the timely payment of interest and the ultimate payment of principal. The credit rating on the Class B notes addresses the ultimate payment of interest and principal on or before the legal final maturity date. Morningstar DBRS does not rate the Class J notes. At issuance, the Notes were backed by a EUR 1.04 billion portfolio by gross book value (GBV) consisting of secured and unsecured Italian nonperforming loans (NPLs) originated by Banco di Sardegna S.p.A. The majority of loans in the portfolio defaulted between 2008 and 2017 and are in various stages of resolution. As of the cut-off date, 53.4% of the pool by GBV was secured. According to the information provided by the servicer in September 2024, 44.4% of the pool by GBV was secured. At closing, the loan pool mainly comprised corporate borrowers (76.9% by GBV), which accounted for approximately 74.8% of the GBV as of September 2024. The receivables are serviced by Prelios Credit Servicing S.p.A. (Prelios or the servicer) while Banca Finint S.p.A. operates as backup servicer. CREDIT RATING RATIONALE The credit rating actions follow a review of the transaction and are based on the following analytical considerations: -- Transaction performance: An assessment of portfolio recoveries as of June 2024, focusing on (1) a comparison between actual collections and the servicer's initial business plan forecast; (2) the collection performance observed over recent months; and (3) a comparison between the current performance and Morningstar DBRS' expectations. -- Updated business plan: The servicer's updated business plan as of June 2024, received in November 2024, and the comparison with the initial collection expectations. -- Portfolio characteristics: The loan pool composition as of June 2024 and the evolution of its core features since issuance. -- Transaction liquidating structure: The order of priority entails a fully sequential amortization of the Notes (i.e., the Class B notes will begin to amortize following the full repayment of the Class A notes and the Class J notes will amortize following the repayment of the Class B notes). Additionally, interest payments on the Class B notes become subordinated to principal payments on the Class A notes if the cumulative collection ratio or present value cumulative profitability ratio is lower than 90%. These triggers have been breached since the January 2021 interest payment date (IPD), with the actual figures at 60.7% and 108.0% as of the July 2024 IPD, respectively, according to the servicer. -- Liquidity support: The transaction benefits from an amortizing cash reserve providing liquidity to the structure covering potential interest shortfall on the Class A notes and senior fees. The cash reserve target amount is equal to 4.9% of the sum of the Class A and Class B notes' principal outstanding and is currently fully funded. -- Interest rate risk: The transaction is exposed to interest rate risk in a rising interest rate environment due to underhedging of the rated notes, which have amortized at a slower pace than the cap notional schedule. According to the investor report from July 2024, the outstanding principal amounts of the Class A, Class B, and Class J notes were EUR 91.2 million, EUR 13.0 million, and EUR 8.0 million, respectively. As of the July 2024 payment date, the balance of the Class A notes had amortized by 60.7% since issuance and the current aggregated transaction balance was EUR 112.2 million. As of June 2024, the transaction was performing below the servicer's business plan expectations. The actual cumulative gross collections equaled EUR 206.9 million, whereas the servicer's initial business plan estimated cumulative gross collections of EUR 340.2 million for the same period. Therefore, as of June 2024, the transaction was underperforming by EUR 133.3 million ( 39.2%) compared with the initial business plan expectations. At issuance, Morningstar DBRS estimated cumulative gross collections for the same period of EUR 260.1 million at the BBB (low) (sf) stressed scenario and EUR 289.2 million at the B (sf) stressed scenario. Therefore, as of June 2024, the transaction was performing below Morningstar DBRS' initial stressed scenarios. Pursuant to the requirements set out in the receivable servicing agreement, in November 2024, the servicer delivered an updated portfolio business plan. The updated portfolio business plan combined with the actual cumulative gross collections of EUR 206.9 million as of June 2024 resulted in a total of EUR 356.7 million, which is 11.1% lower than the total gross disposition proceeds of EUR 401.0 million estimated in the initial business plan and is expected to be realized over a longer period of time. The final maturity date of the transaction is in January 2037. Notes: All figures are in euros unless otherwise noted. BENDING SPOONS: S&P Assigns Preliminary 'B+' ICR, Outlook Stable ---------------------------------------------------------------- S&P Global Ratings assigned a preliminary 'B+' issuer credit rating to Italy-based technology company and digital products developer Bending Spoons S.p.A., a preliminary 'B+' issue rating to the company's proposed $600 million TLB, and a preliminary '3' recovery rating to the TLB, reflecting our anticipation of about 65% recovery for debtholders in the event of default. The stable outlook reflects S&P's expectation that Bending Spoons will continue growing its revenue mainly through new acquisitions and successful integration of acquired digital products, which should allow its S&P Global Ratings-adjusted EBITDA margins to improve above 30% and lead to adjusted leverage of about 4.3x, and free operating cash flow (FOCF) to debt improving toward 10%. Bending Spoons S.p.A. plans to raise a $600 million term loan B (TLB), the proceeds of which it will use to fund the acquisition of the U.S.-based video platform Brightcove in 2025, as well as keeping a portion of the cash for further acquisitions. Based on its successful track record of acquiring mobile, web, and desktop digital products, integrating them into its portfolio, and improving their operating efficiency and monetization, S&P expects that Bending Spoons will integrate Brightcove, along with other products acquired in 2024, with no material setbacks. S&P said, "We assume Bending Spoons will maintain its S&P Global adjusted leverage broadly around 4.0x-5.0x, from 5.0x at year-end 2024, as its growth strategy assumes continued spending on new acquisitions, and we expect it will reduce to about 4.3x in 2025, reflecting EBITDA growth and amortizing debt repayments." The rating reflects Bending Spoons' ability to efficiently monetize its portfolio of digital products and generate solid profits and cashflows, offset by the high competition in the industry and its appetite for growth through acquisitions. Bending Spoons' business model includes acquiring established but underperforming digital products and integrating them into its business. It operates a portfolio of more than 100 digital products with some well-recognized and popular brands across different categories. These include AI-powered personal productivity product Evernote, AI-powered mobile photo editing product Remini, file transfer product WeTransfer, and recently acquired Brightcove, a platform for online distribution and management of video content. The company's digital products are exposed to high competition and risks of technological disruption in the very fragmented global digital products and applications (apps) markets. About 90% of Bending Spoons' revenue is generated from subscriptions, which provide higher stability and visibility of earnings compared with peers that mostly rely on volatile advertising revenue. S&P said, "However, we view its customer base as less loyal than that of software companies, with higher risks of customer churn and limited ability to raise prices. At the same time, we view positively the company's proven track record of successful integration of acquired digital products and improving their monetization, and believe that as it increases in scale, it could achieve solid S&P Global Ratings-adjusted EBITDA margins of above 30%. The company has good cash flow generation and capacity to reduce leverage, but we anticipate that Bending Spoons is likely to continue growing through new acquisitions, which might lead to temporary increases in leverage. We therefore expect it to maintain adjusted leverage broadly in the 4x-5x range in the medium term." The company's somewhat concentrated portfolio of digital products, stiff competition in the industry, and net bookings retention below 100% constrain our assessment of its business risk. In S&P's view, Bending Spoons is smaller than the leading global peers in the tech industry including Meta Platforms, and larger software and digital products developers and its portfolio is somewhat concentrated on a limited number of successful digital products. The eight largest products contributed about 76% to the company's revenue (2024 proforma for all 2024-2025 acquisitions) and 73% to the company's defined EBITDA. In addition, the company operates in large and very fragmented global digital products and apps markets that is exposed to intense competition from existing players, including well capitalized global tech companies, and has low barriers to entry for new digital products developers. Even though some of Bending Spoons' products have loyal customer bases thanks to strong brands, switching costs for most of them are usually low, which lowers user retention. Overall net bookings retention for the portfolio is somewhat below 100%, and it expects some digital products may experience higher customer churn as the company pushes for higher monetization through price increases. The execution of the company's growth strategy depends on its ability to successfully choose acquisition targets. S&P said, "We think inorganic growth will drive the company's revenue expansion in our forecast period through 2026, while its organic growth will remain limited at 1%-3% per year. We expect the company will focus on maintaining its base of more than 300 million monthly active users and is unlikely to convert significantly more users into paying subscribers, given strong competition. In our view, Bending Spoons' growth strategy, focusing on acquisitions, carries risks of selecting the right targets and execution risks related to achieving efficiencies and monetization improvements. We think these risks are partly offset by the company's good track record of acquisitions and successful integration in the past (for example, Evernote, Remini, and Splice), with only few underperforming digital products." Bending Spoons might achieve higher-than-average profitability compared with peers. After an acquisition, the company improves technical aspects and user experience of digital products through code rewriting, adding functions, and improving user interface. It does so by leveraging its in-house IT expertise, AI technologies, and its strong talent pool. The company also enhances monetization and profitability by optimizing products' pricing strategy using in-house technology, streamlining costs by cutting staff of the acquired companies, using a centralized IT development team, and optimizing tech infrastructure costs. S&P said, "We therefore forecast its gross margin to gradually expand to about 80% in 2025-2026 from about 77% in 2024, benefitting from growing scale, and moderating platform distribution and processing fees, as well as sharing infrastructure costs. In addition, we anticipate that Bending Spoons' user acquisition will continue relying on word of mouth from existing users, and effective marketing spend, leveraging its internal measurement technologies. We therefore expect that marketing costs as a percentage of revenue will remain below those of most of its peers and reduce to 8%-10% in 2025-2027 from 12% in 2024. Finally, Bending Spoons' ongoing research and development costs are relatively low and below those of peers, due to its lean operating structure and flexible tech teams, with capitalized IT development after the integration of acquired digital products being minimal. We forecast that acquisition, integration, and restructuring costs will peak in 2025, following the large acquisitions completed in 2024 and of Brightcove in 2025, then gradually decline from 2026, resulting in S&P Global Ratings-adjusted EBITDA margin increasing above 30% in 2025-2026 from about 30% in 2023-2024. "The company generates positive FOCF, thanks to solid profitability and low capital expenditure (capex). We assume that as its business expands, Bending Spoons will be able to keep its relatively lean cost structure. This, in combination with only moderate annual working capital investments and low capex needs, should translate into consistently positive FOCF generation and FOCF to debt improving toward 10%, which is broadly in line with tech and software peers. "Bending Spoons' financial policy assumes continued inorganic growth, which could lead to releveraging. We believe the company will continue to actively pursue new acquisitions and expect it could fund them with a combination of internally generated cash and debt rather than equity. This is because we think its main shareholders--the founders who have the majority of economic and voting rights --might be less willing in the near term to issue new equity to fund acquisitions that might dilute their stakes. Our forecast includes our assumption of continuing annual acquisitions of about EUR250 million and indicates that adjusted leverage could reduce to 4.3x or below in 2025-2026. However, we understand that the company's financial policy assumes maintaining its own calculated net leverage at 2x-3x and might be temporarily higher than that following large acquisitions, corresponding with S&P Global Ratings-adjusted leverage of 4x-5x. "We forecast leverage will reduce to about 4.3x or below in 2025-2026 absent large new mergers and acquisitions (M&A) transactions. We estimate that Bending Spoons' leverage increased in 2024 to 5x due to debt-funded acquisitions of six digital products: StreamYard, Meetup, Mosaic group, Issuu, WeTransfer, and Loomly. The company funded these acquisitions with amortizing bank loans. It plans to raise an additional $600 million TLB to fund the acquisition of Brightcove for about $230 million, which closed in early February 2025. In absence of large new M&A deals, leverage could reduce to about 4.3x in 2025 because of the growing EBITDA and debt repayments of its amortizing term loan A (TLA). "The preliminary ratings are subject to the successful issuance of the proposed debt, and our satisfactory review of the final documentation. Accordingly, the preliminary ratings should not be construed as evidence of final ratings. If we do not receive the final documentation within a reasonable time frame, or if the final documentation departs from the materials we have already reviewed, we reserve the right to withdraw or revise our ratings. Potential changes include, but are not limited to, the key terms and conditions of Bending Spoons' capital structure, including, but not limited to, interest rate, maturity, size, financial and other covenants, the security and ranking of debt, as well as the use of proceeds. "The stable outlook reflects our expectation that Bending Spoons will continue growing revenue mainly by new acquisitions and will successfully integrate acquired digital products and enhance their monetization, while achieving operating cost efficiencies. This should allow its S&P Global Ratings-adjusted EBITDA margins to improve above 30%, generate solid positive FOCF, and lead to adjusted leverage of about 4.3x or below and FOCF to debt improving toward 10%. "We may lower the rating if Bending Spoons' leverage approached 5.0x or its FOCF to debt fell to 5%. This could happen because of operating underperformance due to tough competition, higher churn of paying subscribers, or declining monetization due to inability to raise prices. "Rating upside is unlikely over the next 12 months. However, we could raise the rating on Bending Spoons over the longer term if the company delivered stronger organic growth than we currently expect and significantly increased the scale and diversity of its digital products' portfolio, and consistently achieved S&P Global Ratings-adjusted EBITDA margins above the 30% industry average. Adjusted leverage reducing consistently below 3.5x and FOCF to debt approaching 15%, together with the company's commitment to maintaining such metrics on a sustainable basis, could also lead to an upgrade." BUONCONSIGLIO 3: DBRS Cuts Credit Rating to B, Trend Negative ------------------------------------------------------------- DBRS Ratings GmbH downgraded its credit ratings on Buonconsiglio 3 S.r.l. to B (sf) from BBB (sf) with Negative trend and removed the credit rating from its Under Review with Negative Implications status. The transaction represents the issuance of the Class A, Class B, and Class J notes (collectively, the Notes). The credit rating on the Class A notes addresses the timely payment of interest and the ultimate payment of principal on or before its final maturity date of January 2041. Morningstar DBRS does not rate the Class B or the Class J notes. At issuance, the Notes were backed by a EUR 679.1 million portfolio by gross book value consisting of a mixed portfolio of Italian secured and unsecured nonperforming loans originated by Cassa Centrale Banca - Credito Cooperativo Italiano S.p.A. (Cassa Centrale), 31 co-operative banks belonging to the Cassa Centrale group, and six other private Italian banks. The receivables are serviced by Guber Banca S.p.A (Guber or the Servicer) while Zenith Global S.p.A. (the Master Servicer) was appointed to carry out the master servicing activities. Guber will also act as backup master servicer in case of Zenith's termination as Master Servicer. CREDIT RATING RATIONALE The downgrade follows a review of the transaction and is based on the following analytical considerations: -- Transaction performance: Morningstar DBRS' assessment of portfolio recoveries as of December 2024, focusing on (1) a comparison between actual collections and the Servicer's initial business plan forecast, (2) the collection performance observed over recent months, and (3) a comparison between the current performance and Morningstar DBRS' expectations. -- Updated business plan: The Servicer's updated business plan as of October 2024, received in December 2024, and the comparison with the initial collection expectations. -- Portfolio characteristics: The loan pool composition as of December 2024 and the evolution of its core features since issuance. -- Transaction liquidating structure: The order of priority entails a fully sequential amortization of the Notes (i.e., the Class B Notes will begin to amortize following the full repayment of the Class A Notes and the Class J Notes will begin to amortize following the repayment of the Class B Notes). A portion of the interest due on the Class B Notes is paid ahead of the principal on the Class A Notes unless certain performance-related triggers are breached (i.e., cumulative collection ratio or present value cumulative profitability ratio of less than 90%, or an interest shortfall on the Class A Notes). These triggers had not been breached on the December 2024 semiannual collection date, with actual figures at 94.2% and 101.8%, respectively, according to the Servicer. -- Liquidity support: The transaction benefits from an amortizing cash reserve providing liquidity to the structure and covering potential interest shortfall on the Class A Notes and senior fees. The cash reserve target amount is equal to 4% of the Class A Notes' principal outstanding balance and is currently fully funded. TRANSACTION AND PERFORMANCE According to the July 2024 investor report, the outstanding principal amounts of the Class A, Class B, and Class J Notes were EUR 83.3 million, EUR 21.0 million, and EUR 4.5 million, respectively. As of the July 2024 interest payment date, the balance of the Class A notes had amortized by 45.9% since issuance and the aggregated transaction balance was EUR 108.8 million. As of the December 2024 collection date, the transaction was performing below the Servicer's initial business plan expectations. The actual cumulative gross collections as of December 2024 totaled EUR 114.1 million, whereas the initial business plan estimated cumulative gross collections of EUR 119.2 million for the same period. Therefore, as of December 2024, the transaction was underperforming by EUR 5.1 million (-4.3%) compared with the initial business plan expectations. At issuance, Morningstar DBRS estimated cumulative gross collections of EUR 90.2 million in the BBB (sf) stressed scenario for the same period. Therefore, as of December 2024, the transaction was performing above Morningstar DBRS' initial BBB (sf) stressed expectations. Pursuant to the requirements set out in the servicing agreement, in December 2024 the Servicer delivered an updated portfolio business plan as of October 2024. The updated business plan, combined with the actual cumulative gross collections of EUR 110.0 million as of October 2024, results in a total of EUR 209.5 million expected gross collections, which is 14.4% lower than the total gross collections of EUR 244.7 million estimated in the initial business plan. Considering the cumulative profitability ratio at 101.8% as of December 2024, the Servicer revised the future expected collections on open accounts downward considerably. Conversely, expectations on future nominal recovery costs have been maintained in line with the initial expectations, resulting in them being proportionally higher compared to the expectations at issuance. Excluding actual collections as of June 2024, the Servicer's expected future gross collections from July 2024 account for EUR 110.9 million. Morningstar DBRS' updated B (sf) credit rating stress assumes a haircut of 10.7% to the Servicer's updated business plan, considering total future expected collections from July 2024 onwards. The final maturity date of the transaction is in January 2041. Notes: All figures are in euros unless otherwise noted. DECO 2019 - VIVALDI: DBRS Confirms B(high) Rating on Class D Notes ------------------------------------------------------------------ DBRS Ratings GmbH confirmed the credit ratings on the bonds issued by Deco 2019 - Vivaldi S.r.l. (the Issuer) as follows: -- Class A confirmed at A (high) (sf) -- Class B confirmed at BBB (sf) -- Class C confirmed at BB (high) (sf) -- Class D confirmed at B (high) (sf) At the same time, Morningstar DBRS changed the trends on all credit ratings to Stable from Negative, in line with its credit outlook for the retail sector. CREDIT RATING RATIONALE The credit rating actions reflect the stable performance of the underlying portfolios following the partial prepayment of the loans in August 2024 as part of the restructuring agreed by the noteholders in June 2024. Deco 2019 Vivaldi S.r.l. is a securitization of approximately 95% interest of two refinancing facilities, the Franciacorta loan and the Palmanova loan, backed by two retail outlet villages in Northern Italy. The borrowers are ultimately owned by the funds controlled by Blackstone LLP (the Sponsor) and are managed by Kryalos SGR S.p.a. The loans are interest-only prior to permitted change of control (COC). Following the partial prepayment that occurred in August 2024, their aggregate outstanding balance decreased to EUR 210.5 million from EUR 233.9 million at closing. Both loans pay the three-month Euribor interest rate (floored at zero) plus a margin, which is function of the weighted average (WA) of margins payable on the notes, capped at 4.04% for both loans. Accordingly, the Class D notes are subject to an available funds cap if the shortfall is attributable to an increase in the WA margin of the notes. Consequently, there is no excess spread in the structure with the issuer's ongoing costs and expenses being covered by the borrowers. There are no default covenants prior to the permitted COC. Following the amendment agreement dated June 19, 2024 and from its effective date of August 15, 2024, a cash trap event is continuing until the repayment date. Please see the press release "Morningstar DBRS Comments on Deco 2019 - Vivaldi S.r.l. Loans Restructuring" published June 25, 2024 for more details regarding the amendment. Originally, the loans had a two-year term with three one-year extension options, subject to hedging being extended. The third extension option was exercised, providing the loans with a maturity at the August 2024 interest payment date (IPD). From the loan amendment effective date, the maturity of the loans has been extended to August 2027. A 4.0% strike rate hedging provided by HSBC plc is in place until the August 2026 IPD. As of the November 2024 IPD, the Franciacorta loan balance stands at EUR 151.4 million, representing 72% of the loan pool. Based on the last available valuation report undertaken in December 2023 by Cushman & Wakefield (C&W), the collateral portfolio's value stood at EUR 205.0 million, which represents a further 4.8% decline from the previous valuation of EUR 215.4 million in December 2022 and a 20.3% decline from the initial valuation of EUR 257.3 million at issuance. As of the November 2024 IPD, the loan-to-value ratio (LTV) was 71.5%, down from last year's LTV of 77.2%. As per the amendment loan agreement, all excess cash flow is trapped in the cash trap account until the final repayment date. As of the November 2024 IPD, the amount held in the cash trap is EUR 4.8 million. The Franciacorta debt yield (DY) increased to 10.8% at the November 2024 IPD from 9.4% in November 2023, mainly driven by an improved net rental income (NRI) and lower vacancy rate. The portfolio's NRI increased to EUR 15.9 million as of the November 2024 IPD from EUR 15.6 million the year before, while the vacancy rate decreased to 9.0% from 12.6% a year ago. For the Franciacorta loan, Morningstar DBRS maintained its net cash flow (NCF) assumption at EUR 11.7 million, representing a haircut of 28.0% to the issuer's NRI. Morningstar DBRS maintained its cap rate assumption at 7.1%. This resulted in a Morningstar DBRS value of EUR 165.8 million, which represents a 19.1% haircut to the most recent C&W valuation. The Palmanova loan balance stands at EUR 59.1 million as of November 2024 IPD, representing 28% of the loan pool. Based on December 2023 C&W valuation, the collateral portfolio value stood at EUR 80.0 million, which shows a further 8.2% decline from the previous valuation of EUR 87.1 million in December 2022 and a 22.0% decline from the initial valuation of EUR 102.6 million at issuance. As of the November 2024 IPD, the LTV was 70.3%, down from last year's LTV of 74.4%. As per amendment loan agreement, all excess cash flow is trapped in the cash trap account, until the final repayment date. As of the November 2024 IPD, the amount held in the cash trap is EUR 2.8 million. The Palmanova DY increased to 11.8% at the November 2024 IPD from 9.9% a year earlier. The portfolio's NRI increased to EUR 6.6 million from EUR 6.4 million, while the vacancy rate decreased to 5.9% as of the November 2024 IPD from the vacancy rate of 13.9% a year ago. Morningstar DBRS' NCF assumption for the Palmanova loan stood at EUR 4.7 million as of its last annual review in January 2024, reflecting a haircut of 28.3% compared with the issuer's most recent NRI. Morningstar DBRS' cap rate of 7.5% provides a Morningstar DBRS value of EUR 63.3 million, equivalent to a haircut of 20.9% to the most recent C&W valuation. The transaction benefits from a liquidity reserve facility provided by Deutsche Bank AG, London Branch that can be used to cover interest shortfalls on the Class A and Class B Notes. The size of the reserve stands at EUR 9.5 million as of the November 2024 IPD, decreased from EUR 10.5 million at closing following the partial prepayment that occurred on the August 2024 note payment date. According to Morningstar DBRS, the outstanding balance of the liquidity reserve facility as of November 2024 would be sufficient to cover 12 months of interest payments on the Class A and Class B notes, given the current hedging in place and the margins on the notes but excluding the revenue excess amounts, and 10 months based on the Euribor capped at 5.0% payable on the notes after their maturity. The Morningstar DBRS credit rating on the Class A notes is four notches lower than the credit rating implied by the direct sizing hurdle. The difference is warranted given that the level of liquidity reserve support available to the Class A notes is below the level Morningstar DBRS typically expects in order to mitigate payment disruption risk. At the time of issuance, based on Morningstar DBRS' calculation, the liquidity reserve facility was sufficient to provide 23 months of coverage on the covered notes given the lower hedging requirement compared with the current 12 months coverage based on a WA strike rate of 4.0% in compliance with the hedging conditions laid out in the amendment dated June 2024. The notes' final legal maturity date is scheduled in August 2031, four years after the loan maturity date. The tail period is shorter than the seven-year period Morningstar DBRS would expect in similar Morningstar DBRS-rated transactions. In Morningstar DBRS' view, the reduction of the tail period to four years increases the uncertainty about the repayment of the notes within their final maturity in the event that legal proceedings are initiated in Italian courts. However, such risk is mitigated by the presence of the shares pledge over the holding companies domiciliated in Luxembourg for the Franciacorta and Palmanova assets. In a default scenario, Morningstar DBRS expects that the special servicer would likely exercise the shares pledge over the holding companies to take rapid control over the assets and avoid the longer Italian court proceedings. Notes: All figures are in euros unless otherwise noted. INFRASTRUCTURE WIRELESS: S&P Affirms 'BB+' ICR, Outlook Stable -------------------------------------------------------------- S&P Global Ratings affirmed its 'BB+' long term issuer credit rating on Infrastructure Wireless Italiane S.p.A. (INWIT). The issue rating on INWIT's senior unsecured notes is 'BB+'. The stable outlook reflects INWIT's smooth operational execution, swift organic growth, and industry-leading efficiency indicators. It also factors in that the company benefits from tailwinds such as strong growth in data usage and connectivity, coverage obligations for mobile operators, and inflation. S&P therefore forecasts ample headroom within the rating parameters. S&P said, "The leverage threshold revision to 5.5x-6.5x from 5.0x-6.0x for our 'BB+' rating reflects our reassessed view of INWIT's business risk compared with peers in the telecom infrastructure market. We think INWIT's protective contractual agreement, high quality sites, better collocation rate, and stronger market positioning compares favourably to other single market operators such as Operadora de Sites Mexicanos (Opsimex; BB+/Stable/--), Summit Digitel Infrastructure Ltd. (BBB-/Stable/--), and PT Profesional Telekomunikasi Indonesia (Protelindo; BBB-/Stable/--). INWIT operates under extremely protective contracts with Telecom Italia SpA (TIM; BB/Stable/--) and Vodafone Italy that are eight years long, indefinitely renewable, all or nothing, and indexed to the consumer price index (CPI) with 0% floor, providing high revenue visibility, which partly mitigates risks associated with its concentrated customer base and potential consolidation among mobile network operators in the Italian market. It boasts a very strong position of in Italy, capturing about half of the Italian tower market through a nationwide dense network of 24,000 sites hosting about 54,000 points of presence, and ranks far ahead of the second and third largest tower operators, Cellnex and PTI. The high quality of the company's site network stems from its favorable locations, which benefit from the historical first-mover advantage of TIM and Vodafone Italy. Additionally, a significant portion of its tower backhaul is equipped with fiber, providing a more powerful connection between radio sites and clients' local exchanges compared to traditional airwaves. This translates into a domestic market position that is significantly stronger than that of other single market operators such as Summit Digitel in India and Protelindo in Indonesia, in our view. INWIT's domestic position is more comparable with that of its smaller-scale Mexican peer Opsimex, despite the latter's concentration risks being higher due to having only one anchor tenant. INWIT's tenancy ratio is well above 2.0x, which is among the highest in the industry, indicating better tower utilization and, consequently, superior profitability. "Having said that, we still think INWIT's overall business risk is weaker compared to its peers with excellent business risk assessments, such as American Tower Corp. (BBB/Stable/--) and Crown Castle Inc. (BBB/Stable/A2) in the U.S., as well as Cellnex Telecom S.A. (BBB-/Stable/--) in Europe, due to their larger operational scale." In addition, its U.S. peers benefit from a very mature and consolidated market, while Cellnex's diverse markets and client base reduce risks stemming from the highly fragmented and more volatile European wireless markets. INWIT's improved customer credit standing further supports its business risks assessment. The company's revenues are heavily concentrated on TIM and Vodafone Italy, which together account for about 85% of total revenue. S&P said, "While we do not see a mechanical link between the company's credit quality and that of its customers, the critical nature of its infrastructure services for mobile operators means any increasing divergence between INWIT's credit quality and that of its main clients could ultimately become a more material constraint on the company's business risk profile and the overall rating. However, in recent months we have observed an improvement in the credit quality of its main clients. TIM's credit standing has improved following its sale of fixed network assets and subsequent deleveraging. In addition, the recent merger between Vodafone Italy and Fastweb has resulted in Swisscom (A-/Stable/--) becoming the ultimate parent of Vodafone Italy (Vodafone group is rated BBB/Stable/--)." S&P said, "While we estimate leverage will remain significantly below our relaxed upside threshold of 5.5x from 2024 onward, the stated financial policy indicates a risk of releveraging , which constrains a rating upside. We acknowledge INWIT has been operating under a narrow leverage range of 5.0x-5.5x over the past two years. We think solid organic growth and build-to-suit programs driven by 5G coverage and densification, coupled with long-term growth tailwinds from Italy's digitalization efforts, will continue to support INWIT's growth trajectory. This could lead to further deleveraging below 5.5x on a sustained basis. Nevertheless, since INWIT's leverage tolerance extends up to 6.0x, there is a likelihood that capital allocation decisions--whether for incremental investments to drive organic and inorganic growth or shareholder remuneration--could keep its leverage in the high-end range of the revised 'BB+' trigger. "The stable outlook reflects INWIT's smooth operational execution, swift organic growth, and industry-leading efficiency indicators. It also factors in that the company benefits from tailwinds such as strong growth in data usage and connectivity, coverage obligations for mobile operators, and inflation. We therefore forecast ample headroom within the rating parameters. "We could lower our rating on INWIT if our adjusted debt to EBITDA rises above 6.5x due to operational setbacks or a more aggressive financial policy than expected. "We could raise the rating if S&P Global Ratings-adjusted leverage remains below 5.5x. However, we would need assurance these levels can be sustained, depending on financial policy parameters." PIETRA NERA: DBRS Hikes Class E Notes Rating to BB -------------------------------------------------- DBRS Ratings GmbH took the following credit rating actions on the bonds issued by Pietra Nera Uno S.R.L. (the Issuer): -- Class A Notes confirmed at A (high) (sf) -- Class B Notes confirmed at BBB (high) (sf) -- Class C Notes upgraded to BBB (sf) from BBB (low) (sf) -- Class D Notes confirmed at BB (high) (sf) -- Class E Notes upgraded to BB (sf) from B (high) (sf) The trend on all ratings remains Stable. CREDIT RATING RATIONALE The credit rating upgrades and confirmations follow the repayment of the Palermo loan in full and the deleveraging of the two remaining loans, Fashion District and Valdichiana, because of the restructuring that took place in April 2024 as well as the loans' scheduled amortization. At issuance, the transaction was an agency securitization of three senior commercial real estate loans (i.e., the Fashion District loan, the Palermo loan, and the Valdichiana loan) and two pari passu-ranking capital expenditure facilities for a total initial amount of EUR 403.8 million, which represented a weighted-average (WA) loan-to-value ratio (LTV) of 74.7% at issuance, based on an initial portfolio valuation of EUR 541.3 million. BRE/Europe 7NQ S.a.r.l., the originator, advanced the loans to four Italian borrowers ultimately owned by the Blackstone Group LP (Blackstone or the Sponsor), and the loans are backed by four retail properties located across Italy. Deutsche Bank AG, London Branch (Deutsche Bank) acted as sole arranger for the transaction. The Palermo loan was repaid in full in November 2024, leaving behind The Fashion District loan and Valdichiana loan as collateral. The Fashion District loan is secured by two retail outlet villages -- Mantova Outlet Village and Puglia Outlet Village -- located in northern and southern Italy, respectively. The Valdichiana loan is secured by one retail outlet village -- Valdichiana Outlet Village -- located in Tuscany. The three assets are managed by Land of Fashion Outlet Management Srl, Blackstone's Italian platform focusing on retail outlet villages. On 30 April 2024, Class A noteholders passed an ordinary resolution enacting certain amendments to the facility agreements, including an extension of the original loan maturity date by three years. The Sponsor's proposal entailed the loan extension of three years to May 2027 against a partial repayment of the three loans via equity injection, an increased margin on the notes and a funded cash reserve at loan level to be used to fund any shortfalls of debt service amounts and certain costs amongst other conditions. Please see the following press release from Morningstar DBRS for more details regarding the amendment: "Morningstar DBRS Comments on Pietra Nera Uno S.R.L. Loans Restructuring". In June 2024, the noteholders voted on and passed a further resolution, which included the following amendments, amongst others: (1) the final maturity of the notes was extended to May 2034; (2) Revenue Excess Amounts now rank senior to interest due and payable on the Class Z Notes, Note Premium Amounts, and Liquidity Reserve Subordinated Amounts (previously Revenue Excess Amounts ranked junior to the three items listed above); and (3) the primary servicer shall not be capable of granting any extension to the repayment date of any loan without noteholder consent. The balance of the Fashion District loan declined to EUR 106.6 million from EUR 122.8 million over the quarter ended May 2024 because of scheduled amortization and a repayment of EUR 16.2 million via an equity injection as stipulated by the amendment dated April 2024. Similarly, the balance of the Valdichiana loan declined to EUR 88.9 million from EUR 94.1 million over the same quarter because of scheduled amortization and a repayment of EUR 5.2 million via an equity injection from the borrower. Both loans continue to amortize by 1.0% per annum. The outstanding balances of the Fashion District and Valdichiana loans stand at EUR 106.0 million and EUR 88.4 million as of November 2024, respectively. Primarily driven by the reduction in loan balances, both loans' debt yields (DYs) improved over the past four quarters. The Fashion District loan's DY rose to 16.1% as of November 2024 from 10.47% as of November 2023. Meanwhile the Valdichiana loan's DY went up to 13.2% from 11.4% over the same period. The contracted rent for the Fashion District portfolio increased to EUR 15.1 million from EUR 14.0 million between November 2023 and November 2024. Similarly, contracted rent for the Valdichiana asset increased to EUR 11.7 million from EUR 11.3 million. All surplus net rental income is paid into the cash trap account for each loan following the amendment dated 30 April 2024. As of November 2024, the cash trap balance of the Fashion District and Valdichiana loans is EUR 5.3 million and EUR 6.5 million, respectively. Based on the latest available valuation report dated February 29, 2024 prepared by Cushman & Wakefield (C&W), the appraised value of Valdichiana is EUR 128.9 million, which shows a decline of 2.0% over the previous valuation (EUR 131.5 million), and the collective value of the two assets securing the Fashion District loan, Mantova and Puglia, is EUR 143.5 million, which shows a 4.2% decline over the previous valuation (EUR 149.8 million). C&W also conducted the previous valuation dated 31 March 2023. In spite of a modest decline in market value for all the assets comprising the collateral, the LTV metrics as of November 2024 show improvement compared with November 2023 because of the deleveraging of the loans. Fashion District's LTV declined to 70.5% as of November 2024 from 82.4% as of November 2023. Valdichiana's LTV declined to 66.4% from 71.7% over the same period. Morningstar DBRS maintained its net cash flow (NCF) and capitalization rate (cap rate) assumptions for Fashion District at EUR 9.5 million and 8.25%, respectively. This results in a Morningstar DBRS value of EUR 114.6 million, which represents a 20% haircut over the most recent appraised value of EUR 143.5 million. Similarly, Morningstar DBRS maintained its NCF and cap rate assumptions for Valdichiana at EUR 8.1 million and 7.5%, respectively. This results in a Morningstar DBRS value of EUR 108.5 million, which represents a 16% haircut over the most recent appraised value of EUR 128.9 million. Each of the securitized loans bears interest at a floating rate equal to three-month Euribor (subject to a floor of zero) plus a margin resulting from the WA of the aggregate interest amounts payable to the notes. The loans are fully hedged against interest rate risk via cap agreements expiring in May 2026, with strike rates of 3.90% for the Fashion District loan and 3.92% for the Valdichiana loan. The hedging counterparty is HSBC Bank plc. The transaction benefits from a liquidity reserve facility of EUR 7.2 million (compared with EUR 15.0 million at origination), which represents 5.6% of the total outstanding balance of the covered notes, provided by Deutsche Bank. The Issuer can use the liquidity reserve facility to cover interest shortfalls on the Class A and Class B Notes. There had been no liquidity facility drawing as of the November 2024 interest payment date (IPD). According to Morningstar DBRS, the outstanding balance of the liquidity reserve facility as at the November 2024 IPD would be sufficient to provide 12 months of coverage based on the WA cap rate strike across the two loans and 10 months based on the Euribor cap of 5.0% payable on the notes after their maturity date, not accounting for the Revenue Excess Amounts which are not rated by Morningstar DBRS. The Morningstar DBRS credit rating on the Class A Notes is three notches lower than the credit rating implied by the Direct Sizing Hurdles. This difference is warranted given that the level of liquidity support available to the Class A Notes is below the level Morningstar DBRS typically expects in order to mitigate payment disruption risk. At the time of issuance, the liquidity facility was sufficient to provide 23 months of coverage on the covered notes according to Morningstar DBRS' calculation. The coverage is now 12 months as stated above based on the WA cap rate strike across the two loans and not including Revenue Excess Amounts. The primary reason for the decline in liquidity facility coverage is that the WA cap rate strike across the loans securing the transaction was 2.0% at the time of issuance, and it is now 3.91%, which complies with the hedging conditions laid out in the amendment dated April 2024. Following the amendments that passed in April and June 2024, the final legal maturity of the notes is now 22 May 2034, seven years after the loan maturity (15 May 2027). Given the security structure and jurisdiction of the underlying loan, Morningstar DBRS believes this provides sufficient time to enforce on the loan collateral, if necessary, and repay the bondholders. Notes: All figures are in euros unless otherwise noted. REKEEP SPA: Moody's Affirms 'B3' CFR & Alters Outlook to Stable --------------------------------------------------------------- Moody's Ratings has changed to stable from negative the outlook on Rekeep S.p.A. Concurrently, Moody's have affirmed Rekeep's B3 corporate family rating and B3-PD probability of default rating. Moody's have also assigned a new B3 instrument rating to the proposed EUR350 million senior secured notes (the new notes) due August 2029 to be issued by Rekeep S.p.A. The B3 instrument rating on the EUR370 million senior secured notes (the outstanding notes) due February 2026 is unaffected. The proceeds from the proposed EUR350 million new notes issuance, coupled with cash on balance sheet, will be used to repay the EUR370 million outstanding notes and pay the transaction costs. Moody's will withdraw the rating of the outstanding notes upon full repayment. "The rating action reflects Moody's expectation that Rekeep will successfully refinance the outstanding notes and thus extend the maturity profile of its debt and that the company will progressively reduce its leverage over the next 12-18 months while maintaining Moody's adjusted free cash flow (FCF) at around break even levels", says Sarah Nicolini, a Moody's Ratings Vice President-Senior Analyst and lead analyst for Rekeep. RATINGS RATIONALE In the last twelve months ended September 2024, Rekeep's credit metrics were almost unchanged compared to 2023: its Moody's adjusted EBITA margin was stable at 4.6%, while its leverage, as measured by Moody's adjusted gross debt/EBITDA, remained high at 6.8x (7.3x including the FM4 fine, related to an infringement of competition rules in 2014) and its FCF was negative as a result of high capital expenditures. Moody's anticipate that the proposed bond issuance will be broadly leverage neutral. Over the next 12-18 months, Moody's forecast that the company will increase its profitability to reach a Moody's adjusted EBITA margin around 6%, stemming from unaltered strong growth in Poland, increasing fixed costs absorption and disciplined pricing to offset wage inflation. This profitability improvement will support a reduction in leverage, with Moody's adjusted debt/EBITDA projected to decrease to around 5.6x (6x including the FM4 fine) over the same period. Moody's also expect that the higher profit will more than offset the negative impact of higher interest expenses post refinancing, thus improving the company's Moody's adjusted EBITA/interest expense to an average 1.2x over the next 12-18 months, compared to 0.9x as of the last twelve months to September 2024. Similarly, Moody's anticipate that Rekeep's FCF generation will remain close to break even, owing to sustained capital expenditure to support international growth. The B3 CFR continues to be supported by the company's leading market positioning in the Italian and Polish facility management market; a degree of revenue visibility, supported by its order book and its multi-year contracts; and the non-discretionary nature of its business activities. A comprehensive review of all credit ratings for the respective issuer(s) has been conducted during a rating committee. LIQUIDITY Rekeep's liquidity is adequate. As of September 2024, the company had around EUR29 million of cash and a committed EUR75 million super-senior revolving credit facility (RCF), maturing in August 2025, out of which EUR60 million was undrawn. Rekeep has also access to a EUR300 million factoring facility maturing in January 2028, of which EUR52 million were used as of September 2024. Moody's anticipate that the company will generate nearly break even FCF over the next 12-18 months. Moody's expect the super-senior RCF maturity to be extended concurrently with the issuance of the new proposed senior secured notes, although with a reduction of the committed amount to EUR55.5 million. Additionally, Moody's expect the springing financial maintenance covenant to be maintained. Moody's forecast that the new super-senior RCF will be temporarily drawn in February to finance the seasonal working capital needs and that it will be fully reimbursed by the end of the first quarter. STRUCTURAL CONSIDERATIONS The B3 rating on the new proposed EUR350 million senior secured notes is aligned with the CFR, as it is only subordinated to the new proposed super-senior RCF. Both the new senior secured notes and the new super-senior RCF will be secured against share pledges of certain companies of the group and intercompany receivables. Moody's typically view debt with this type of security package as akin to unsecured debt. In addition, the new RCF will benefit from a special lien (privilegio speciale) on the company's moveable assets. RATIONALE FOR THE STABLE OUTLOOK The stable outlook incorporates Moody's expectation that the company will successfully refinance the existing notes. Additionally, the stable outlook also reflects Moody's assumption that the company will progressively reduce its leverage over the next 12-18 months, stemming from improving profit, and that FCF generation will be around break even over the same period. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS Upward pressure on the rating could develop if the company builds a track record of reducing its exposure to litigation and potential fines or if its operating performance strengthens materially through a combination of EBITDA growth and positive FCF, both on a sustained basis; and the company sustainably reduces its Moody's-adjusted debt/EBITDA (including FM4 fine) towards 5.0x. Conversely, downward pressure on the rating could be exerted if the outstanding notes become current as a result of the non-completion of the proposed refinancing transaction, or if Rekeep's credit metrics deteriorate further as a result of weakening operating performance or loss of sizeable contracts, penalty payments or significant legal costs, or an aggressive change in its financial policy. Quantitatively, downward pressure on the rating could develop if its Moody's-adjusted debt/EBITDA (including FM4 fine) increases above 6.5x or FCF stays negative, both on a sustained basis. Furthermore, any negative outcome from the investigations, ranging from management distraction to reputational risk or even financial damage, would strain the company's rating. PRINCIPAL METHODOLOGY The principal methodology used in these ratings was Business and Consumer Services published in November 2021. COMPANY PROFILE Founded in 1938 and headquartered in Bologna (Italy), Rekeep S.p.A. (formerly Manutencoop Facility Management S.p.a.) is a leading provider of facility management and laundry and sterilisation services in Italy and Poland. The company is also exposed to Turkey, Saudi and France. In the last twelve months ending September 2024, Rekeep generated revenue of EUR1213 million. =================== K A Z A K H S T A N =================== KASPI BANK: S&P Withdraws 'BB+/B' Issuer Credit Ratings ------------------------------------------------------- S&P Global Ratings withdrew its 'BB+/B' long- and short-term issuer credit ratings and 'kzAA+' Kazakhstan national scale rating on Kaspi Bank JSC at the bank's request. The outlook was stable at the time of the withdrawal. ===================== N E T H E R L A N D S ===================== JUBILEE PLACE 7: DBRS Gives Prov. B(high) Rating on Class E Notes ----------------------------------------------------------------- DBRS Ratings GmbH assigned provisional credit ratings to the residential mortgage-backed notes to be issued by Jubilee Place 7 B.V. (the Issuer) as follows: -- Class A notes at (P) AAA (sf) -- Class B notes at (P) AA (high) (sf) -- Class C notes at (P) A (high) (sf) -- Class D notes at (P) BBB (high) (sf) -- Class E notes at (P) B (high) (sf) -- Class X1 notes at (P) BBB (high) (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 August 2062. 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, Class E and Class X1 notes address the ultimate payment of interest and principal by the legal final maturity date. Morningstar DBRS does not rate the Class F, Class S1, Class S2, Class X2, or Class R notes also expected to be issued in this transaction. CREDIT RATING RATIONALE Jubilee Place 7 B.V. will be a bankruptcy-remote special-purpose vehicle incorporated in the Netherlands. The Issuer will use the proceeds from the 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 (Citibank; 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 30 November 2024, the portfolio consisted of 687 loans with a total portfolio balance of approximately EUR 299.4 million. The weighted-average (WA) seasoning of the portfolio is 0.7 years with a WA remaining term of 32.1 years. The WA current loan-to-value ratio of 68.3% is in line with that of other Dutch BTL residential mortgage-backed securities (RMBS) transactions. The loan parts in the portfolio are either interest-only loans (96.8%) or repayment mortgage loans (3.2%). Most of the loans were granted for the purpose of remortgage (78.8%). 99% of the loans in the portfolio are fixed with a compulsory future switch to floating, while 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 10.50%, which is provided by the subordination of the Class B to Class F notes and the liquidity reserve fund. Credit enhancement for the Class B notes will be 5.50% and will be provided by the subordination of the Class C to Class F notes and the liquidity reserve fund. Credit enhancement for the Class C notes will be 3.25% and will be provided by the subordination of the Class D to Class F notes and the liquidity reserve fund. Credit enhancement for the Class D notes will be 1.25% and will be provided by the subordination of the Class E and Class F notes and the liquidity reserve fund. Credit enhancement for the Class E notes will be 0.55% and will be provided by the subordination of the Class F notes and the liquidity reserve fund. The transaction benefits from an amortizing liquidity reserve fund (LRF) that the Issuer can use 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 1.25% (100/95) of the outstanding balance of the Class A and Class B notes. The LRF is floored at 0.25% (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 have 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 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' "Legal and 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 and Derivative 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 its 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 and the replacement language in the transaction documents. -- The consistency of the transaction's legal structure with Morningstar DBRS' "Legal and Derivative Criteria for European Structured Finance Transactions" methodology and the presence of legal opinions addressing the assignment of the assets to the Issuer. Notes: All figures are in euros unless otherwise noted. SANDY HOLDCO: S&P Downgrades ICR to 'B-', Outlook Stable -------------------------------------------------------- S&P Global Ratings lowered its long-term issuer credit rating on Dutch holiday park operator Sandy Holdco and on its senior secured debt to 'B-' from 'B'. S&P said, "Our stable outlook reflects our view that Sandy should report supportive operating performance in the next 12 months, despite elevated integration costs, as well as our view that the group does not face significant liquidity risk in the short term and no immediate refinancing risks." Elevated costs linked to the integration of Landal in 2025 will slow Sandy's deleveraging prospects, with S&P Global Ratings-adjusted leverage remaining above 7x in 2025. In 2023, the group closed the acquisition of Landal's business and since then the management has been working on its integration as well as the realization of its cost-savings plan. S&P said, "We understand the group has budgeted EUR78 million in one-off costs to implement initiatives required to realize roughly EUR72 million of cost synergies (to be achieved by 2026) such as reorganization of the headquarters, centralized procurement, and IT system migration, among others. We expect most of those one-off costs will be incurred over 2024-2025 with higher-than-anticipated impact expected for the current year. This negatively affects Sandy's EBITDA and increases pressures on its deleveraging profile. We now estimate S&P Global Ratings-adjusted debt to EBITDA will remain elevated at around 7.3x-7.8x in 2025 (depending on the RCF drawings at year-end 2025) from the about 9.6x spike in 2024, a level which we deem commensurate with a 'B-' rating." The company has announced the issuance of a EUR75 million TLB add-on and upsized its RCF to improve liquidity and foster growth opportunities. The company plans to increase its TLB due 2029 to EUR1.125 billion from EUR1.05 billion and upsize its RCF to EUR175 million from EUR125 million. S&P said, "Despite the higher debt quantum, we see the transaction providing a liquidity buffer to manage intra-year working capital requirements and flexibility to accommodate existing park refurbishment and new parks development. The group has expressed ambitions to accelerate international expansion in markets such as Germany, the U.K., and France, or minor markets such as Austria and Denmark to diversify geographically. We believe the group's intention to invest to modernize its asset portfolio would support long-term revenue growth prospects through higher occupancy and average daily rates (ADRs). While we do not expect a significant increase in investments in 2025, which should remain at a maintenance level of around EUR60 million, we believe the group could resume some discretionary capital expenditure (capex) from 2026 when the integration costs will likely have reduced significantly." S&P said, "Sandy has a limited track record of positive free operating cash flow (FOCF) generation after leases, which we expect should be positive at EUR10 million-EUR20 million in 2025. In 2024 we expect FOCF after leases to be materially negative at around EUR30 million-EUR35 million, primarily because of elevated acquisition-related costs (nonrecurring in 2025) and integration-related expense. While the evolution of FOCF after leases for the current year should remain depressed because of the integration costs, we believe it should be positive at around EUR10 million-EUR20 million. However, this is contingent on the full and timely achievement of cost savings, as well as successful implementation of some working capital management initiatives, such as revision of payment terms and guest prepayments. "We see early signs of top-line improvements after soft consumer demand in the third quarter of 2024, which should support 3%-4% revenue increase in 2025. The fourth quarter of 2024 already showed positive performance improvement after a softer-than-expected summer, driven by strong pre-booking levels, mainly based on higher volumes. The group enjoys relatively predictable booking patterns because slightly more than 50% of the annual revenue is secured through bookings in the first four months of the year. So far, first indications are positive with a 5.8% increase in rental revenue as of Jan. 20, 2025, compared with the same period last year, driven by 3.2% more volumes and 2.5% increase in ADRs. The current booking trends give more confidence that the group could achieve our expectations in terms of top-line growth in 2025 at around 3%-4%, compared with a relatively flat performance in 2024. We see higher uncertainties around EBITDA margin evolution in 2025, which we expect at 21%-22%, from about 17% in 2024, due to staff cost inflation, high nonrecurring costs, and ability to timely and successfully realize cost-savings initiatives." The VAT increase on accommodation in the Netherlands might raise affordability concerns and top-line volatility from 2026. The Dutch government has approved a VAT increase to 21% (from 9%) for culture, sports, media and accommodation, which is likely to be effective from Jan. 1, 2026, with implications for the entire leisure sector in the Netherlands (roughly 80%-85% of Sandy's sales). The management aims to pass on to customers around one-third of the rate increase through price increases, while the park partnership business (around 28% of the revenue) should allow the business to share the burden of the VAT increase with its partners. Overall, the management anticipates around EUR35 million impact on its EBITDA, which should be neutralized through price initiatives and cost-savings opportunities. S&P said, "However, we believe further price increases could be limited by potential affordability concerns, mainly in the part of the business exposed to low-budget travellers, or by a narrowing price gap with other travel destinations. We therefore expect Sandy's top line to decline by 1%-2% in 2026 and EBITDA margin to expand to about 26% from 21%-22% in 2025 as we take into consideration some impact from the VAT increase offset by a notable decline in nonrecurring costs and realized cost savings. The leisure sector is lobbying for alternatives to avoid the VAT rate hikes, which, if agreed, would likely improve our forecast on the company's operating performance in 2026." S&P said, "Our stable outlook reflects our view that Sandy should post supportive operating performance in the next 12 months, despite elevated costs to achieve synergies from the integration of Landal. Under our current base case, we expect EBITDA margins to stand at 21%-22% in 2025 from about 17% in 2024, before increasing to around 26% in 2026 as integration costs ease and assuming the group will be able to partially mitigate the VAT increase in the Netherlands. This should result in positive FOCF of EUR10 million-EUR20 million after lease payments in 2025, supporting the group's adequate liquidity profile. We expect S&P Global Ratings-adjusted leverage to reduce to 7.3x-7.8x in 2025 (depending on the RCF drawings at year-end 2025) from estimated 9.6x in 2024, then trending down below 7.0x in 2026. "We could lower the rating if we see a significant deterioration in the group's liquidity profile compared to our base case or a material increase in leverage leading us to deem the capital structure as unsustainable. We believe this could happen if the group's operating performance weakened well below our base case due to failure to successfully integrate Landal in a timely manner or if we see deterioration in consumer demand, leading to pressures on the group's profitability and FOCF generation remaining sustainably negative. "We could raise the rating if Sandy's performance improved above our base case, supported by solid consumer demand, good cost control, and successful integration of Landal leading to solid profitability expansion and working capital management. For a positive rating action, we would also need to have evidence that the group had mitigated the impact of the VAT increase through cost-savings initiatives, price adjustments, and improved promotional activities. Alternatively, we could revise our base case if the VAT increase expected for 2026 will not be implemented. Under these scenarios, we would need to see a clear deleveraging trend below 7x on a sustainable basis and positive FOCF after leases on a recurring basis." SPRINT MIDCO: S&P Assigns 'CCC' LongTerm ICR, Outlook Negative -------------------------------------------------------------- S&P Global Ratings assigned its 'CCC' long-term issuer credit rating to Sprint Midco B.V., with a negative outlook. S&P also assigned issue and recovery ratings to the post-restructuring debt tranches. At the same time, S&P raised its issuer credit rating on Sprint HoldCo B.V. to 'CCC' from 'SD' and subsequently withdrew this rating at the issuer's request. S&P also withdrew its issue rating on the restructured and cancelled EUR705 million term loan B (TLB) tranche. Accell Group's parent company, Sprint HoldCo B.V., has restructured its debt, including a 40% debt write-down and injection of fresh liquidity, reducing both operating-level debt and cash interest. As part of the transaction, Sprint Midco B.V. became the group's new parent, while the operating group remains Sprint Bidco B.V. S&P assigned its 'CCC' long-term issuer credit rating to Sprint Midco B.V., with a negative outlook. The negative outlook reflects the possibility of a lower rating in the short to medium term. This could be a result of a persistently challenging European bicycle market environment and weak consumer sentiment, in Germany in particular. In addition, S&P cannot dismiss unforeseen and unexpected working capital swings due to supply chain pressures and deviations in cash conversion from management's efforts to optimize the cost structure and its distribution network. The comprehensive debt restructuring will reduce Accell Group's total debt to EUR1.2 billion from approximately EUR1.6 billion. With the restructuring, completed Feb. 12, 2025, debt at operating level fell dramatically to EUR834 million, with negligible cash interest, particularly during the first 12 months as the group benefits from a payment-in-kind (PIK) toggle interest feature in its new operating company (OpCo) super senior facility, and largely PIK-based debt service. The previous EUR180 million revolving credit facility (RCF) and EUR705 million TLB have been restructured into approximately EUR308 million of new debt that comprises the second-lien OpCo and second- and third-lien HoldCo facilities, plus a 5% equity stake. Existing TLB and RCF lenders were invited to participate in the new OpCo super senior facility of EUR125 million principal amount (at 20% original issue discount), which also came with a 15% equity stake. The new capital structure, under the new parent, Sprint MidCo, includes EUR364 million of debt at the parent company and EUR834 million of OpCo debt, under the legal entity Sprint BidCo B.V. This comprises: Sprint BidCo's EUR167 million senior secured facility with 12-month PIK toggle interest of E+7%, its EUR376 million 1.5 lien facility (E+7% PIK; or 0.5% cash plus PIK), and its EUR80 million second-lien facility (E+7% PIK; or 0.5% cash plus PIK). The first two mature in May 2030 and the latter in June 2031; Sprint Midco's EUR100 million first-lien facility, its EUR130 million second-lien facility, and its EUR134 million third-lien facility, all maturing in June 2031 (all three with PIK interest, and a negligible cash interest on the second and third lien facilities). Accell Group starts 2025 with a healthier inventory mix. It reduced its stocks of finished goods by 50% by the end of 2024 since the peak in 2023. The group cleared it stock via discounts, leading to lower gross margins in 2024. S&P said, "In addition, we expect the company will gradually reduce costs by producing most of its bikes in lower cost countries and simplifying product platforms to benefit from better cross-use of components. Accell has increased data integration and transparency of inventory at the dealer level, which will help it to respond quickly to adverse demand developments. We expect this will yield better data on stock levels than previously, and therefore soften potential working capital swings." The group's liquidity position remains fragile. S&P does not take into account the group's additional EUR100 million super senior facility availability, which is uncommitted. Although the debt restructuring has postponed maturities and has dramatically reduced cash interest during 2025, the cash interest cost will increase in 2026 as the PIK toggle feature on the super senior secured OpCo loan will become cash only in subsequent years. After restructuring and advisory fees, we estimate that the group will have EUR30 million-EUR35 million of cash on balance sheet. Working capital swings have been substantial in the past years, but S&P estimates up to EUR50 million per year, with the low point of cash on balance sheet typically in April, just before the busy spring season. Accell is highly dependent on favorable business and financial conditions to meet the obligations arising from its normal course of business and we cannot exclude another liquidity crunch in the next 12 months. The group's forecast anticipates a normalization in the market, with increased sales volumes and improved gross margins in 2025 compared with 2024. It also expects a gradual return to pre-pandemic margins by the end of 2026. Nevertheless, Accell is facing difficult market conditions, making the timing and magnitude of this recovery difficult to predict and largely beyond its control. Weak consumer confidence and high inventory levels in the overall industry are the main obstacles to a rebound in 2025. Accell reduced its inventory stock over 2024 to a normal level, but this came at the expense of heavy discounting, especially on e-bikes, due to the high technological redundancies in this segment. S&P said, "Around 40%-50% of net sales come from the Central Europe segment, which includes Germany, and we expect no market recovery in this geography in the short to medium term, as consumer confidence remains low. In our view this will translate into continued high stock levels at bicycle dealers, preventing margin recovery and new orders from dealers." S&P said, "The 'CCC' rating reflects our expectation that the group will realize negative EBITDA and negative free operating cash flow (FOCF) after leases in 2025. We estimate negative S&P Global Ratings-adjusted EBITDA of negative EUR265 million in 2024 and expect improvement to negative EUR73 million in 2025. We believe gross margins will not fully recover in 2025 and higher net sales will not cover the group's operating cost structure, despite the management's swift and comprehensive actions to streamline its portfolio of products, simplify components across product platforms, reign in inventory, and control supply chains. We estimate FOCF after leases was negative EUR346 million in 2024 and expect around negative EUR126 million in 2025. In addition, management will need to demonstrate its grasp on inventory transparency in its distribution channel, which is an important element of working capital movements. "The negative outlook reflects the difficult market conditions and the highly uncertain timing and extent of a market recovery, which may lead to a liquidity shortfall over the next 12 months, absent alternative liquidity sources. Though we have seen positive momentum in terms of cost and supply chain optimization, due to management initiatives, this may not be sufficient to offset unforeseen developments in supplier terms and overall market recovery. "We assign a negative outlook generally when we believe that an event or trend has at least a one-in-three likelihood, as a broad guideline, of resulting in a negative rating change in one year for speculative-grade credits. "We could lower the rating if Accell Group's liquidity deteriorates, leading to a large FOCF deficit and a wider liquidity shortfall, with cash on balance sheet approaching or falling below the company's EUR15 million cash covenant trigger. We could also lower our rating if we consider another distressed debt restructuring or any other specific default scenario to be likely within the next 12 months." An upgrade would depend on the pace of overall market recovery, and cost and supply chain optimization leading to greater degree of inventory control throughout the group's distribution channels. This would likely lead to a steady recovery in EBITDA. S&P would also expect to see improvement in FOCF such that a liquidity shortfall appeared remote over the 12-month rating horizon. ========= S P A I N ========= GRUPO AVINTIA: DBRS Confirms B(low) Issuer Rating, Stable Trend --------------------------------------------------------------- DBRS Ratings GmbH confirmed the Issuer Rating on Corporacion Grupo Avintia, S.L. (Avintia or the Group) at B (low) with a Stable trend. KEY CREDIT RATING CONSIDERATIONS The credit rating action reflects the improved estimated results for F2024, which showed an increase in revenues to EUR 622 million with an EBITDA margin at 3.1%, and the expectation of ongoing similar operating performance. However, the credit rating action also considers the uncertainty around the property development business in the medium term, which leads to a low visibility with regards to cash flow generation, the underperformance of the Group against their own forecast and the delays in the information provided. The Stable trend reflects an activity level which continues to be supported by the construction backlog which is now around EUR 900 million. The recent Spanish government announcement regarding their intention to build more affordable social housing may boost the Company's backlog in particular as the Company has strong experience and technical capabilities. However, Morningstar DBRS remains prudent as this process could take long time. CREDIT RATING DRIVERS Although a credit rating upgrade is not likely at this time, Morningstar DBRS could consider an upgrade if the cash flow-to-debt ratio remains higher than 3.0%, debt-to-EBITDA less than 8.0 times (x), and EBITDA margin significantly higher than 2% on a sustained basis, coupled with the receipt of consistent and timely financial information. Morningstar DBRS could consider a credit rating downgrade if the financial metrics deteriorate in the upcoming years with cash flow-to-debt ratio of less than 2.0%, debt-to-EBITDA of less than 10.0 times (x), and EBITDA margin of less than 1.8%. A further significant restatement of the audited financial statements could also negatively affect the credit rating. EARNINGS OUTLOOK Looking ahead, Morningstar DBRS expects the Group to generate revenues above EUR 600 million while slightly improving the EBITDA margin at 3.3% in F2025 and 3.6% in F2026 from 3.1% estimated for FY2024. The improvement takes into account the increase in the proportion of industrialized construction over the traditional construction. In addition, the change in the property development strategy focusing on build-to-rent units to be sold once construction is completed, while improving profitability, at the same time increases the risk of delays in cash flow generation. Morningstar DBRS notes that management forecasts higher revenues and profitability for the 2025-26 period but, given the high volatility in the construction and property development sector and the overestimated projections in previous years, Morningstar DBRS remained extremely prudent in its base case. FINANCIAL OUTLOOK Although gross debt has decreased over the last two years, Morningstar DBRS expects a significant increment on indebtedness as the Group expects to boost the property development business. For F2025, Morningstar DBRS expects debt-to-EBITDA to surpass 6.5x to continue increasing to more than 7.5x on F2026 if the Group is able to continue with the development of the build-to-rent units. Morningstar DBRS anticipates cash flow-to-debt to remain around 7.0% on average for 2025 and 2026, reflecting some delays on the execution of the business plan. CREDIT RATING RATIONALE Avintia is a partially vertically integrated construction group with activities primarily in construction and property development. The Group's creditworthiness is supported by its (1) knowledge of the markets in which the Group operates with a solid domestic market position and (2) strong construction backlog. The Group's creditworthiness is constrained by its (1) low profitability, coupled with the high industry risk characterized by cyclicality, intense competition, and volatility; (2) increasing the proportion of fixed-price contracts; and (3) lack of visibility on the property development business. Notes: All figures are in euros unless otherwise noted. =========================== U N I T E D K I N G D O M =========================== CAPRI HOLDINGS: Fitch Affirms 'BB' LongTerm IDR, Outlook Negative ----------------------------------------------------------------- Fitch Ratings has upgraded Capri Holdings Limited's revolving credit facility to 'BBB-' with a Recovery Rating of 'RR1' from 'BB'/'RR4' following an amendment to secure the previously unsecured instrument. Fitch has also assigned a 'BBB-'/'RR1' rating to the company's new senior secured $392 million term loan facility at Michael Kors (USA) Inc. and a new $302 million term loan at Michael Kors (Switzerland) GmbH. Proceeds from the new term loan went towards repaying the company's term loan maturities due later in 2025. Fitch has affirmed Capri's and Michael Kors (USA) Inc.'s Long-Term IDR's at 'BB' and assigned a new Long-Term IDR to Michael Kors (Switzerland) GmbH at 'BB'. The Rating Outlook remains Negative. Capri's 'BB' rating and Negative Outlook reflects ongoing topline and EBITDA declines in its portfolio, raising concerns about stabilizing operations soon. The Negative Outlook indicates potential for EBITDAR leverage sustained above 3.0x and EBITDAR fixed charge coverage sustained below 2.0x over the next 12 to24 months. Capri needs to expand EBITDA from an expected $365 million in fiscal 2025 towards $600 million and repay debt over the next 12 to 24 months to support the 'BB' rating. Bonds were pre-refunded, escrowed, defeased or cancelled (this includes program ratings where that program is closed or the issuer is no longer issuing debt under that program and there is no Fitch-rated debt outstanding under that program). The Long-Term IDR and term loan rating have been withdrawn at Gianni Versace S.r.l. given the debt has been repaid. Key Rating Drivers Accelerating Topline and EBITDA Declines: Capri's performance has been significantly below expectations since early 2023. Recent challenges are partly due to brand-specific issues at Michael Kors, exacerbated by management mis-execution across the portfolio and underinvestment over the last 15 months during the pending merger process. Additionally, ongoing consumer softness in the global luxury market due to weakness in China and retail travel has also impacted results. Combined company revenue for fiscal 2024 (YE March 2024) declined approximately 8%, driven by a 9% decline at the Michael Kors brand, which accounted for approximately 68% of overall fiscal 2024 revenue. For the first three quarters of fiscal 2025, revenue declines have accelerated to the mid-teens, driven largely by weakness at Michael Kors and Versace. Fitch projects EBITDA for fiscal 2025 to decline to $365 million, based on a 14% projected revenue drop. This compares to $780 million in fiscal 2024 and $1.4 billion and $1.2 billion in fiscal 2022 and 2023, respectively. Significant Execution Risk Ahead: Fitch expects Capri will require four to six quarters to stabilize its business. Growth should return to low single-digits in fiscal 2027, driven by flat growth at Michael Kors and low single-digit growth at Jimmy Choo and Versace. This assumes that Capri corrects its pricing strategy, addresses product offerings, and stabilizes wholesale channels at Michael Kors and Versace. However, Fitch views execution risk as high given the company's recent track record. The company will close approximately 75 Michael Kors stores over the next two years, while keeping the Versace and Jimmy Choo units flat. Capri plans to share more details on its turnaround strategy at an upcoming investor day in February 2025. Fitch recognizes Capri's portfolio of leading mid-tier and luxury accessory brands and its history of good execution, offering a path to topline and margin recovery. EBITDA to Trend Below Historical Levels: Fitch expects Capri's EBITDA to expand from $365 million in fiscal 2025 to approximately $580 million by fiscal 2028, but still below the $1.2 billion to $1.4 billion range seen in fiscal 2022 and 2023. This assumes topline trends stabilization in fiscal 2027 and EBITDA margin expansion from an expected 8.2% in fiscal 2025 to the low-double digits. Capri must balance investments with cost efficiencies to offset this impact. Fitch notes that the timing, scale and impact of potential U.S. tariffs are uncertain, and not included in current forecasts. Incremental costs could further pressure margins. Reasonable FCF: Due to EBITDA declines, Fitch expects FCF will trend lower in the $150 million-$250 million range beginning in fiscal 2025. This is compared to an average of around $450 million over the last four years. Historically, Capri has used cash generation for debt repayment, share repurchases, and business investment. After the merger was terminated, the company announced that their capital allocation priorities will be investing in the business, repaying debt and returning cash to shareholders. Near-Term Maturities Addressed: On Feb. 4, 2025, Capri announced that it had amended its credit agreement, issuing a new secured $700 million term loan facility, proceeds of which, along with revolver borrowings, were used to repay the company's $450 million and EUR450 million unsecured term loans both of which are due later in 2025. In addition, the company secured its $1.5 billion revolving credit facility. Both the revolver and term loan facilities are secured under the same credit agreement and mature in July 2027. Moderate Leverage; Weak Fixed Charge Coverage: Fitch expects Capri's EBITDAR leverage to climb to the mid-3x range in fiscal 2025 from 2.6x in fiscal 2024, driven by EBITDA declines. To support a 'BB' rating, Capri needs to expand EBITDA and use FCF to repay debt and bring EBITDAR leverage back below 3.0x. The 3.0x EBITDAR leverage threshold is low for a 'BB' rating, and balanced by the company's weak EBITDAR fixed charge coverage. This is expected to be in the mid-1x range in fiscal 2025 and could return towards 2.0x over the next 24 months, in line with EBITDA expansion. Parent-Subsidiary Linkage: Fitch's analysis includes a strong subsidiary/weak parent approach between the parent, Capri, and its subsidiary, Michael Kors (USA) Inc. and Michael Kors (Switzerland) GmbH. Fitch assesses the quality of the overall linkage as high, which results in an equalization of their IDRs. Derivation Summary Similarly rated peers include Signet Jewelers Ltd. (BB+/Stable), Samsonite Group S.A. (BB+/Stable), and Levi Strauss & Co. (BBB-/Stable). Signet and Samsonite remain under criteria observation given its new treatment of leases, published on Dec. 6, 2024. The UCO designation indicates that the existing ratings may change due to the application of the final criteria. Signet's ratings consider good execution from a topline and margin standpoint, which supports Fitch's longer-term expectations of low single-digit revenue and EBITDA growth. The rating reflects Signet's leading market position as a U.S. specialty jeweler with an approximately 9% share of a highly fragmented industry. Samsonite's rating considers the company's status as the world's largest travel luggage company, with strong brands and historically good organic growth. Levi's ratings reflect its position as one of the world's largest branded apparel manufacturers, with broad channel and geographic exposure, and good execution in terms of both topline and margins. This supports Fitch's medium-term expectations of low single-digit revenue and EBITDA growth. Key Assumptions - Revenue growth to decline in the low-teens in fiscal 2025, driven by double digits declines at Michael Kors and Versace. Beginning in fiscal 2027, revenue growth could turn flat-to-slightly positive, driven by flattish performance at Michael Kors and low-single digit growth at Versace and Jimmy Choo. - EBITDA to contract to approximately $365 million in fiscal 2025 from $780 million in fiscal 2024 driven by topline declines and gross margin contraction. Beginning in fiscal 2026, Fitch expects EBITDA to rebound, modestly, driven by margin expansion as the company effectively manages its cost structure and inventory levels. Fitch expects that Capri's EBITDA could expand from a trough of $365 million in fiscal 2025 towards the high-$500 million range by fiscal 2028. - FCF to be around $125 million in fiscal 2025 assuming a modest working capital inflow and capital expenditures around $125 million. Beginning in fiscal 2026, FCF could trend in the $150 million to $250 million range, assuming an EBITDA rebound, neutral working capital and capex of around $125 million. Fitch expects Capri to deploy FCF toward debt reduction, in line with its historical practice. - EBITDAR leverage to climb to the mid-3.0x range in fiscal 2025, from 2.6x in fiscal 2024, driven by significant EBITDA declines. Fitch expects EBITDAR leverage to moderate to below 3x by fiscal 2027, driven by EBITDA expansion and debt repayment. - Interest rate assumptions: The revolving credit facility (SOFR+2.00%) and term loan facility (SOFR+2.00%) are both floating rate instruments. Fitch's annual SOFR assumptions are the following: (fiscal 2025: 4.75%); (fiscal 2026: 4.00%); (fiscal 2027: 3.50%); (fiscal 2028: 3.50%). - Achieving the above assumptions could result in a revision of Capri's Outlook to Stable. - Fitch has not incorporated any impact to its assumptions from the new administration regarding potential changes around tariffs, immigration, or taxation. Recovery Analysis Fitch does not employ a waterfall recovery analysis for issuers that are assigned ratings in the 'BB' category. Due to the distance to default, Recovery Ratings in the 'BB' category are not computed by bespoke analysis. Instead, they serve as a label to reflect an estimate of the risk of these instruments relative to other instruments in the entity's capital structure. Fitch has upgraded Capri Holdings Limited's and Michael Kors (USA), Inc.'s (co-borrowers) newly secured revolving credit facility from 'BB'/'RR4' to 'BBB-'/'RR1'. Fitch has assigned the new secured term loan facility a 'BBB-'/'RR1' rating and assigned a 'BBB-'/'RR1' rating to the revolver at Michael Kors (Switzerland) GmbH. Using proceeds from the new term loan facility, along with revolver borrowings, Capri repaid its EUR450 million unsecured term loan under Gianni Versace S.r.l. as well as its $450 million unsecured term loan co-borrowed under Michael Kors (USA) Inc., Michael Kors (Switzerland) GmbH, and Capri Holdings Limited. Fitch has therefore withdrawn the IDR and unsecured term loan rating at Gianni Versace S.r.l . RATING SENSITIVITIES Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade - A slower than expected recovery with EBITDA sustained below $500 million; - EBITDAR Leverage sustained above 3.0x; - EBITDAR Fixed Charge Coverage sustained below 2.0x. Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade - Fitch could revise the Outlook to Stable if EBITDAR leverage is sustained below 3.0x and EBITDAR Fixed Charge Coverage is around 2.0x. This could be accomplished through a combination of EBITDA rebound and debt repayment. An upgrade to 'BB+' could result from: - Low-single digit growth, along with EBITDA expansion and debt repayment; - EBITDAR Leverage sustained below 2.5x; - EBITDAR Fixed Charge Coverage approaching the high-2x. Liquidity and Debt Structure As of Dec. 28, 2024, Capri had $356 million in cash and $978 million in availability on its revolving credit facility. The company's debt structure as Dec. 28, 2024 consisted of its $1.5 billion unsecured revolving credit facility due July 2027, $450 million in unsecured term loan debt maturing Oct. 31, 2025, and a EUR450 million term loan facility borrowed under Gianni Versace S. r. l, which matures in December 2025. On Feb. 4, 2025, Capri filed an 8-K announcing that it had amended its credit agreement. As part of this amendment, Capri secured its $1.5 billion revolving credit facility and entered into a new $700 million secured term loan. The credit facilities are secured by certain U.S. assets and intellectual property. Capri used the proceeds from the new term loan to repay its $450 million unsecured term loan as well as the EUR450 million unsecured term loan at Gianni Versace S.r.l. The revolving facility is co-borrowed under Capri Holdings Limited and Michael Kors (USA), Inc. and Michael Kors (Switzerland) GmbH. The new term loan is co-borrowed under Michael Kors (USA) Inc., the USD tranche, and Michael Kors (Switzerland) GmbH, the Euro tranche. Michael Kors (Switzerland) GmbH is Capri's principal operating entity in EMEA. Issuer Profile Capri Holdings Limited is a leading global manufacturer and retailer of accessories and leather goods, primarily handbags and footwear. The company's portfolio consists of three brands: Michael Kors, Jimmy Choo and Versace. Summary of Financial Adjustments Historical and projected EBITDA is adjusted to add back non-cash stock-based compensation and exclude non-recurring charges. Fitch uses the balance sheet reported lease liability as the capitalized lease value when computing lease-equivalent debt. MACROECONOMIC ASSUMPTIONS AND SECTOR FORECASTS Fitch's latest quarterly Global Corporates Macro and Sector Forecasts data file which aggregates key data points used in its credit analysis. Fitch's macroeconomic forecasts, commodity price assumptions, default rate forecasts, sector key performance indicators and sector-level forecasts are among the data items included. 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 ----------- ------ -------- ----- Michael Kors (USA), Inc. LT IDR BB Affirmed BB senior secured LT BBB- New Rating RR1 senior secured LT BBB- Upgrade RR1 BB Gianni Versace S.r.l. LT IDR WD Withdrawn BB senior unsecured LT WD Withdrawn BB Michael Kors (Switzerland) GmbH LT IDR BB New Rating senior secured LT BBB- New Rating RR1 Capri Holdings Limited LT IDR BB Affirmed BB senior secured LT BBB- Upgrade RR1 BB J.S. WRIGHT: FRP Advisory Named as Administrators ------------------------------------------------- J.S.Wright & Co.Limited was placed into administration proceedings in the High Court of Justice Business and Property Courts of England and Wales, Insolvency & Companies List (ChD), Court Number: CR-2025-00788, and Rajnesh Mittal and Benjamin Neil Jones of FRP Advisory Trading Limited were appointed as administrators on Feb. 10, 2025. J.S.Wright engages in plumbing, heat and air-conditioning installation. Its registered office is at Atlas Buildings, 16 Portland Street, Birmingham, B6 5RX in the process of being changed to C/o FRP Advisory Trading Limited, 2nd Floor, 120 Colmore Row, Birmingham, B3 3BD Its principal trading address is at Atlas Buildings, 16 Portland Street, Birmingham, B6 5RX The joint administrators can be reached at: Rajnesh Mittal Benjamin Neil Jones FRP Advisory Trading Limited 2nd Floor, 120 Colmore Row Birmingham, B3 3BD Any person who requires further information may contact: The Joint Administrators Tel No: 0121 710 1680 Email: cp.birmingham@frpadvisory.com Alternative contact: Abbie Lenihan KULTRALAB LTD: Quantuma Advisory Named as Administrators -------------------------------------------------------- Kultralab Ltd was placed into administration proceedings in the High Court of Justice Business and Property Courts of England and Wales, Court Number: CR-2025-000206, and Nicholas Simmonds and Chris Newell of Quantuma Advisory Limited were appointed as administrators on Jan. 30, 2025. Kultralab Ltd is engaged in electrical installation. Its registered office is at 5 Brayford Square, London, E1 0SG and it is in the process of being changed to 1st floor, 21 Station Road, Watford, Herts, WD17 1AP. Its principal trading address is at 4 Bream's Buildings, London, EC4A 1HP. The joint administrators can be reached at: Nicholas Simmonds Chris Newell Quantuma Advisory Limited 1st Floor, 21 Station Road Watford, Herts, WD17 1AP For further details, please contact: Laura Bodgi Tel No: 01923 943494 Email: Laura.Bodgi@quantuma.com MAGIC ROCK: FRP Advisory Named as Administrators ------------------------------------------------ Magic Rock Brewing Company Ltd was placed into administration proceedings in the High Court of Justice Court Number: CR-2025-000039, and David Hudson and Philip David Reynolds of FRP Advisory Trading Limited were appointed as administrators on Jan. 30, 2025. Magic Rock is a manufacturer retail and wholesaler of beer. Its registered office is c/o FRP Advisory Trading Limited, at 2nd Floor, 110 Cannon Street, London, EC4N 6EU Its principal trading address is at Willow Park Business Centre, Willow Lane, Huddersfield, HD1 5EB The joint administrators can be reached at: David Hudson Philip David Reynolds FRP Advisory Trading Limited 110 Cannon Street London EC4N 6EU Further details, contact: The Joint Administrators Tel No: 020 3005 4000 Alternative contact: Bobby Cotter Email: cp.london@frpadvisory.com NEWDAY PARTNERSHIP VFN-P1: DBRS Confirms BB(high) Rating on E Notes ------------------------------------------------------------------- DBRS Ratings Limited confirmed the credit ratings of the notes listed below (collectively, the Notes) issued by NewDay Partnership Master Issuer and NewDay Partnership Loan Note Issuer following its annual review of the Notes: NewDay Partnership Master Issuer: Series 2023-1 -- Class A Notes at AAA (sf) -- Class B Notes at AA (high) (sf) -- Class C Notes at A (high) (sf) -- Class D Notes at BBB (high) (sf) NewDay Partnership Loan Note Issuer: VFN-P1 -- V1 Class A Loan Note at BBB (high) (sf) -- V2 Class A Loan Note at AAA (sf) -- V2 Class B Loan Note at AA (sf) -- V2 Class C Loan Note at A (sf) -- V2 Class E Loan Note at BB (high) (sf) The credit ratings address the timely payment of scheduled interest and the ultimate repayment of principal by the legal final maturity date. The Notes or each transaction is a securitization of co-branded credit cards affiliated with high street and online retailers granted to individuals domiciled in the UK by NewDay Ltd. (NewDay or the originator) and are issued out of NewDay Partnership Master Issuer or NewDay Partnership Loan Note Issuer as part of the NewDay Partnership master issuance structure under the same requirements regarding servicing, amortization events and priority of distributions. NewDay Cards Ltd. (NewDay Cards) is the initial servicer with Lenvi Servicing Limited (Lenvi) in place as the backup servicer for each transaction. CREDIT RATING RATIONALE -- The transaction's capital structure, including the form and sufficiency of available credit enhancement to support Morningstar DBRS' expected yield, charge-off rate and monthly principal payment rate (MPPR) under various stress scenarios -- The ability of the transaction to withstand stressed cash flow assumptions and repay the notes -- The originator's capabilities with respect to origination and underwriting -- An operational risk review of NewDay Cards and Lenvi with respect to servicing -- The transaction parties' financial strength regarding their respective roles -- The credit quality, the diversification of the collateral, and the securitized portfolio's historical and projected performance -- Morningstar DBRS' long-term sovereign rating on the United Kingdom of Great Britain and Northern Ireland at AA with a Stable trend -- The consistency of the transaction's legal structure with Morningstar DBRS' methodology "Legal and Derivative Criteria for European Structured Finance Transactions" TRANSACTION STRUCTURE Each transaction typically 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 have the option to extend the scheduled revolving period by up to 12 months. If the notes are not fully redeemed at the end of their respective scheduled revolving periods, the individual transaction would enter into a rapid amortization. Each transaction includes a series-specific liquidity reserve that has been replenished to the target amount in the transaction's interest waterfalls. The liquidity reserve is available to cover the shortfalls in senior expenses, senior swap payments if applicable and interest due 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 all GBP-denominated 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 floating-rate Notes. The potential interest rate mismatch risk is to a certain degree mitigated by excess spread and the originator's ability to increase the credit card contractual rate and is considered in Morningstar DBRS' cashflow analysis. COUNTERPARTIES Citibank, N.A. London Branch remains as the account bank for each transaction. Based on Morningstar DBRS' private credit ratings on Citibank, N.A. London Branch and the downgrade provisions outlined in the transaction documents governing NewDay Partnership Master Issuer, Morningstar DBRS considers the risk arising from the exposure to the account bank to be commensurate with the credit ratings assigned to the notes issued by NewDay Partnership Master Issuer. Nonetheless, as the transaction documents governing NewDay Partnership Loan Note Issuer do not include Morningstar DBRS' rating thresholds in respect of the account bank, permitted investments and servicer and sub-servicer accounts, there may be larger volatility for VFN P1-V1 and VFN P1-V2 credit ratings than the notes issued by NewDay Partnership Master Issuer when Morningstar DBRS' view of counterparty credit worthiness differs from the rating thresholds currently included in the documents. PORTFOLIO ASSUMPTIONS The most recent investor report for the month of December 2024 indicates a total payment rate of 38.9%, notably improved from 19.3% in June 2023 before the inclusion of the John Lewis Partnership (JLP) receivables to the securitized portfolio in July 2023. While the historical data of JLP receivables as a new credit card type is still relatively short and has yet to normalize, the available performance history to date shows low charge-off rates and high MPPRs. Based on the trend of latest performance data and the current compositions of different receivable types in the securitized portfolio, Morningstar DBRS elected to maintain the expected MPPR at 20%. A period of gradual increases in reported yields since mid-2022 was the result of NewDay's active repricing activities following the increases in the Bank of England base rate. Due to the high MPPRs, the JLP receivables generate relatively low yields which dampen the increases in portfolio yields. The total yields remained relatively stable throughout 2024, with 24.7% reported for the month of December 2024. Based on the trend of recent performance data and the current compositions of different receivable types in the securitized portfolio, Morningstar DBRS also maintained the expected yield at 22%. The reported charge-off rates of the securitized portfolio have been between 5% and 7% since March 2020 until April 2023 when it reached a record high of 7.9% before receding to below 4% in December 2023 after the addition of the JLP receivables. The levels stabilized in 2024 and most recently at 4.6% for the month of December 2024. While the trend of recent performance data is encouraging, Morningstar DBRS continued to maintain the expected charge-off rate at 7.5%. Morningstar DBRS notes the addition of the JLP receivables into the securitized portfolio contributes favorably to the collateral performance and the receivables balance of the securitized portfolio has steadily declined to a similar level before the inclusion of the JLP receivables. As the performance data of the JLP receivables is still not considered normalized, Morningstar DBRS will continue to monitor the transaction performance. Notes: All figures are in British pound sterling unless otherwise noted. ORIGAMI ENERGY: FRP Advisory Named as Administrators ---------------------------------------------------- Origami Energy Limited was placed into administration proceedings in the High Court of Justice Business and Property Courts of England and Wales, Insolvency & Companies List, Court Number: CR-2025-000629, and Geoffrey Paul Rowley and Simon Baggs of FRP Advisory Trading Limited were appointed as administrators on Jan. 31, 2025. Origami Energy, trading as Origami Energy, engaged in information technology service activities. Its registered office is at Barclays Eagle Lab, 28 Chesterton Road, Cambridge, CB4 3AZ to be changed to 2nd Floor, 110 Cannon Street, London, EC4N 6EU. The joint administrators can be reached at: Geoffrey Paul Rowley Simon Baggs FRP Advisory Trading Limited 110 Cannon Street London, EC4N 6EU For further details, contact: The Joint Administrators Tel No: 020 3005 4000 Alternative contact: Edward Gordon Email: cp.london@frpadvisory.com PEAK JERSEY: S&P Lowers LongTerm ICR to 'CCC+', Outlook Negative ---------------------------------------------------------------- S&P Global Ratings lowered its long-term issuer credit rating on Peak Jersey Holdco Ltd., Stat Perform's holding company, as well as the issue ratings on its RCF and senior secured term loan, to 'CCC+' from 'B-'. The negative outlook reflects Peak Jersey's significant refinancing risks associated with its upcoming debt maturities, in addition to its slower-than-expected revenue growth trajectory, which leads us to view its current level of debt as unsustainable, and see a risk that failure to secure timely refinancing or adverse business developments could trigger liquidity stress. The group's capital structure appears unsustainable with high cash interest costs significantly draining liquidity. Stats Perform reported an 8% revenue growth in the first nine months of 2024 defined EBITDA margin maintained at 18%. This growth was primarily driven by new product launches and price increases. However, it fell short of S&P's previous expectations of 13%-15% for 2024, indicating potential challenges ahead. Notably, the betting segment experienced muted growth during the third quarter of 2024, reflecting a tightening of spending by some U.K.-based betting companies in response to increased regulatory and compliance costs. A significant portion of the anticipated $90 million-$100 million management-defined 2024 EBITDA (which translates into S&P Global Ratings-adjusted EBITDA of $60 million-$70 million after deducting capitalized development costs and exceptional costs) is required to cover the $80 million cash interest cost on its unhedged financial debt, further straining liquidity and raising concerns about the sustainability of its capital structure. High leverage and negative free operating cash flow (FOCF) could challenge the group's refinancing efforts as the majority of its debt matures within the next 18 months. S&P said, "We forecast the group will report S&P Global Ratings-adjusted leverage above 9x in 2024, alongside a negative FOCF. The group faces the following debt maturities within the next 18 months: GBP10 million of the GBP50 million ($61 million equivalent) RCF matures in February 2026; the remaining GBP40 million of the RCF matures in April 2026; and the $500 million term loan B matures in July 2026. In our view, the refinancing depends on favorable business, financial, and economic conditions to meet its financial commitments." S&P said, "We assess the group's liquidity as less than adequate. Stats Perform has almost fully drawn its $61 million equivalent RCF and its liquidity is entirely supported by its cash holdings of $38.5 million as of Sept. 30, 2024 along with cash flow from operations. The group faces working capital requirements in the first half of the year as it pays for sports rights in advance. However, we also acknowledge that the group's decision to not renew its Serie A sports rights will reduce the working capital pressure. A strengthening U.S. dollar--in light of an increasingly protectionist trade tariff environment--could represent an indirect earnings and cash flow headwind in 2025. Stats Perform generates roughly 40% of its revenue in British pounds sterling, 35% in euros, and 20% in U.S. dollars, while about 40% of its operating costs are denominated in U.S. dollars. Moreover, the group does not hedge its receivables against a sudden dollar appreciation, which we consider a material risk. "The negative outlook reflects our view that Peak Jersey faces significant refinancing risks associated with its upcoming debt maturities. We view its current level of debt as unsustainable, and failure to secure timely refinancing or adverse business developments could trigger liquidity stress. "We could lower our rating on Peak Jersey if we expect the company to face a default scenario over the next 12 months, including a missed interest payment or distressed debt exchange. We would likely view any exchange offer or debt buyback by the company or its owners as a distressed exchange if executed well below the nominal value of the notes, given the elevated leverage. "We see limited rating upside over the next 12 months absent a successful refinancing of all its debt instruments (including the second lien debt). Any rating upside will also depend on our view on the sustainability of future capital structure, post refinancing, and the group's ability to continue to grow its business to reduce the overall leverage below 7.5x and demonstrate a track record of maintaining adequate liquidity." WRIGHT MAINTENANCE: FRP Advisory Named as Administrators -------------------------------------------------------- Wright Maintenance Limited was placed into administration proceedings in the High Court of Justice, Business & Property Courts, Court Number: CR-2025-00791, and Rajnesh Mittal and Benjamin Neil Jones of FRP Advisory Trading Limited were appointed as administrators on Feb. 10, 2025. Wright Maintenance specialized in business support service activities. Its registered office is at Atlas Building 16 Portland Street, Birmingham, B6 5RX in the process of being changed to C/o FRP Advisory Trading Limited 2nd Floor, 120 Colmore Row, Birmingham, B3 3BD Its principal trading address is at Atlas Building 16 Portland Street, Birmingham, B6 5RX The joint administrators can be reached at: Rajnesh Mittal Benjamin Neil Jones FRP Advisory Trading Limited 2nd Floor, 120 Colmore Row Birmingham, B3 3BD Further details, contact: The Joint Administrators Tel No: 0121 710 1680 Alternative contact: Abbie Lenihan Email: cp.birmingham@frpadvisory.com [] Perry Higgins Joins PwC's Restructuring Team in Manchester ------------------------------------------------------------- Perry Higgins has joined PwC's restructuring team in Manchester as a director in early February 2025, as the firm continues to invest in its North West team. Perry was previously with AlixPartners. Perry guides companies and stakeholders through complex restructuring engagements. He is a qualified Insolvency Practitioner in the United Kingdom, a member of the Institute of Chartered Accountants of Scotland, and holds a first-class honours degree in economics from the University of Sheffield. His clients have included public and private companies, directors, secured and unsecured creditors, public sector bodies and regulators; giving him a deep understanding of the perspectives of stakeholders in high-stakes restructuring engagements. He has worked across various industries, including aviation, automotive, media, professional services, manufacturing, retail and leisure. [] PFK Smith Cooper Dean Nelson to Lead Nottingham Team ------------------------------------------------------- Head of Business Recovery and Restructuring at PKF Smith Cooper Dean Nelson will head up the business recovery and restructuring team in Nottingham in a new era for the service line, marking a stronger and more aligned presence for PKF in the East Midlands. A partner at PKF Smith Cooper with over 25 years' experience in business recovery and restructuring, Dean Nelson will be working at both the firm's Nottingham and Derby offices to help businesses in financial distress across the East Midlands. Already an established name in business recovery and restructuring, the firm's team has worked on many high profile cases in recent years, including the administration of Robinson Structures Limited (which saw 68 jobs saved) and the rescue of Belper Leisure Centre, a cornerstone of the local community. Dean will be supported by a strong and experienced team in this next chapter for the firm, who will also operate across the region to ensure a consolidated and consistent service offering for the firm's East Midlands clients. Director Emily Oliver, who recently became a licensed insolvency practitioner, will continue to be an instrumental force in the firm's Derby office, while manager Kieran Marshall, who has worked at the firm since 2018, rises to the challenge of a more senior role in Nottingham. Dean commented: "Following recent team changes, I knew that heading up our team in Nottingham and embracing a more united approach across our East Midlands offices would be crucial to ensure our clients continue to benefit from PKF's first-class business recovery and restructuring services. "Last year, we acquired insolvency boutique BLB advisory, which strengthened PKF Smith Cooper's presence in the West Midlands and saw us gain a new partner in Brett Barton as well as over 80 years of combined industry experience from new team members. "There's a strong future ahead for PKF Smith Cooper in the East Midlands, and we're confident that this new chapter for Nottingham and Derby will enable us to grow our service offering, specialist team and existing reputation in the East Midlands. Maintaining a tangible presence in key locations and building solid relationships with clients have always been central to our company values, and I am looking forward to working closely with current and future clients in Nottingham." [] PKF Smith's E. Oliver Becomes Licensed Insolvency Practitioner ----------------------------------------------------------------- PKF Smith Cooper further strengthens their Derby and wider East Midlands presence as Business Recovery and Restructuring Director Emily Oliver becomes a Licensed Insolvency Practitioner. Emily joined PKF Smith Cooper fifteen years ago as an Insolvency Administrator and has since been promoted five times, becoming Business Recovery and Restructuring (BRR) Director in 2023, and is based in the firm's Derby office. Emily began her restructuring and recovery career in a small restructuring boutique after graduating university and has since accumulated over a decade of front-line experience dealing with OMB's. During her career, she has qualified as an ACCA accountant and has also completed the Certificate of Proficiency in Insolvency. Emily has played a vital role in the Business Recovery and Restructuring team and her efforts have been notable, assisting clients in securing their future when they are experiencing financial distress. She has supported on several high-profile cases, including the rescue of Belper Leisure Centre. On gaining her Insolvency Practitioner License, Emily commented: "I am very thankful for the support I have received from Dean Nelson, Head of PKF Smith Cooper Business Recovery and Restructuring team and I look forward to the next step in my restructuring career, continuing to support and advise clients in finding the best possible solution for their business in this difficult trading period." Dean Nelson, commented: "It is great to see our East Midlands presence strengthened and I am thrilled to see Emily's dedication and hard work pay off after 15 years of being with the firm in reaching this pinnacle achievement." =============== X X X X X X X X =============== [] BOND PRICING: For the Week February 10 to February 14, 2025 -------------------------------------------------------------- Issuer Coupon Maturity Currency Price ------ ------ -------- -------- ----- Altice France Hol 10.500 5/15/2027 USD 30.484 Bilt Paper BV 10.360 USD 1.769 Turkiye Governmen 10.400 10/13/2032 TRY 48.725 Cabonline Group H 11.937 4/19/2029 SEK 40.000 IOG Plc 12.022 9/22/2025 EUR 0.446 Ferralum Metals G 10.000 12/30/2026 EUR 29.350 Marginalen Bank B 11.457 SEK 28.417 Fastator AB 12.500 9/26/2025 SEK 38.001 Fastator AB 12.500 9/25/2026 SEK 39.691 Privatbank CJSC V 10.250 1/23/2018 USD 3.673 NCO Invest SA 10.000 12/30/2026 EUR 0.152 Sidetur Finance B 10.000 4/20/2016 USD 0.930 Tinkoff Bank JSC 11.002 USD 42.875 NCO Invest SA 10.000 12/30/2026 EUR 0.152 Kvalitena AB publ 10.067 4/2/2024 SEK 45.750 Transcapitalbank 10.000 USD 1.450 Avangardco Invest 10.000 10/29/2018 USD 0.186 Societe Generale 21.000 12/26/2025 USD 16.600 UkrLandFarming PL 10.875 3/26/2018 USD 1.870 Plusplus Capital 11.000 7/29/2026 EUR 8.650 Altice France Hol 10.500 5/15/2027 USD 31.123 Privatbank CJSC V 10.875 2/28/2018 USD 4.824 Bilt Paper BV 10.360 USD 1.769 Bulgaria Steel Fi 12.000 5/4/2013 EUR 0.216 R-Logitech Financ 10.250 9/26/2027 EUR 5.189 Fastator AB 12.500 9/24/2027 SEK 39.697 Privatbank CJSC V 11.000 2/9/2021 USD 0.500 UniCredit Bank Gm 12.250 2/28/2025 EUR 43.870 Oscar Properties 11.270 7/5/2024 SEK 0.077 Raiffeisen Schwei 16.000 7/8/2025 CHF 41.890 Barclays Bank PLC 14.250 12/18/2025 USD 36.912 NTRP Via Interpip 10.250 8/2/2017 USD 1.002 Phosphorus Holdco 10.000 4/1/2019 GBP 0.309 Elli Investments 12.250 6/15/2020 GBP 0.380 Societe Generale 17.800 2/12/2026 USD 45.466 Societe Generale 15.000 9/29/2025 USD 13.000 UniCredit Bank Gm 10.700 2/17/2025 EUR 7.850 JP Morgan Structu 13.250 11/28/2025 EUR 1.042 Bank Vontobel AG 14.500 8/15/2025 USD 44.900 Landesbank Baden- 11.000 1/2/2026 EUR 12.530 Landesbank Baden- 19.000 2/28/2025 EUR 5.250 Societe Generale 11.000 7/14/2026 USD 17.000 UBS AG/London 10.000 3/23/2026 USD 31.470 ACBA Bank OJSC 11.500 3/1/2026 AMD 0.000 Finca Uco Cjsc 13.000 5/30/2025 AMD 9.800 BNP Paribas Issua 19.000 9/18/2026 EUR 4.030 Goldman Sachs Int 16.288 3/17/2027 USD 24.920 Banco Espirito Sa 10.000 12/6/2021 EUR 0.058 Bulgaria Steel Fi 12.000 5/4/2013 EUR 0.216 BLT Finance BV 12.000 2/10/2015 USD 10.500 Lehman Brothers T 10.000 10/23/2008 USD 0.100 Lehman Brothers T 15.000 6/4/2009 CHF 0.100 Lehman Brothers T 23.300 9/16/2008 USD 0.100 Tonon Luxembourg 12.500 5/14/2024 USD 2.216 KPNQwest NV 10.000 3/15/2012 EUR 0.521 Serica Energy Chi 12.500 9/27/2019 USD 1.500 Elli Investments 12.250 6/15/2020 GBP 0.380 UkrLandFarming PL 10.875 3/26/2018 USD 1.870 JP Morgan Structu 16.000 9/26/2025 EUR 1.032 JP Morgan Structu 20.250 12/30/2025 EUR 1.099 JP Morgan Structu 26.000 12/30/2025 EUR 0.938 JP Morgan Structu 16.250 6/27/2025 EUR 1.068 JP Morgan Structu 13.750 12/30/2025 EUR 1.085 JP Morgan Structu 15.000 9/26/2025 EUR 1.079 JP Morgan Structu 17.750 12/30/2025 EUR 1.036 JP Morgan Structu 10.000 6/26/2026 EUR 0.914 Basler Kantonalba 15.000 8/12/2025 CHF 48.660 Corner Bank Ltd G 16.000 7/31/2025 CHF 48.550 Bank Vontobel AG 14.500 4/4/2025 CHF 21.500 Bank Vontobel AG 11.000 4/11/2025 CHF 17.500 Bank Vontobel AG 12.000 4/11/2025 CHF 21.400 Raiffeisen Schwei 13.000 3/25/2025 CHF 25.510 DZ Bank AG Deutsc 16.000 6/27/2025 EUR 40.920 DZ Bank AG Deutsc 10.100 6/27/2025 EUR 47.850 Leonteq Securitie 12.000 8/5/2025 CHF 29.370 Zurcher Kantonalb 14.000 6/17/2025 USD 28.570 Basler Kantonalba 16.000 10/15/2025 CHF 41.690 Leonteq Securitie 18.000 5/27/2025 CHF 34.020 Raiffeisen Schwei 16.000 2/19/2025 CHF 44.650 Zurcher Kantonalb 23.000 3/5/2025 CHF 44.830 Bank Julius Baer 17.500 7/30/2025 CHF 48.300 Leonteq Securitie 16.000 3/4/2025 CHF 44.480 UBS AG/London 15.000 4/7/2025 USD 30.700 DZ Bank AG Deutsc 23.600 3/28/2025 EUR 48.390 DZ Bank AG Deutsc 18.900 3/28/2025 EUR 39.710 DZ Bank AG Deutsc 23.600 3/28/2025 EUR 32.470 Raiffeisen Schwei 16.000 7/4/2025 CHF 28.170 Landesbank Baden- 10.500 4/28/2025 EUR 8.470 Landesbank Baden- 19.000 4/28/2025 EUR 8.100 Leonteq Securitie 20.000 3/21/2025 CHF 43.910 Bank Vontobel AG 16.000 6/24/2025 USD 38.700 Landesbank Baden- 16.500 4/28/2025 EUR 8.080 Bank Vontobel AG 24.000 4/14/2025 CHF 34.900 Corner Banca SA 18.400 7/22/2025 CHF 29.850 Swissquote Bank S 14.960 7/1/2025 CHF 32.010 Bank Vontobel AG 14.000 6/23/2025 CHF 35.900 Bank Vontobel AG 15.000 10/14/2025 USD 37.900 Landesbank Baden- 16.000 1/2/2026 EUR 15.850 Landesbank Baden- 13.000 6/27/2025 EUR 9.230 Raiffeisen Switze 16.000 3/4/2025 CHF 8.230 Corner Banca SA 16.800 1/12/2026 USD 43.020 Bank Vontobel AG 11.000 8/11/2025 CHF 46.100 Leonteq Securitie 15.600 10/22/2025 CHF 49.060 Bank Vontobel AG 25.000 4/29/2025 CHF 42.000 Landesbank Baden- 10.500 4/24/2026 EUR 14.840 DZ Bank AG Deutsc 11.050 5/23/2025 EUR 50.230 Leonteq Securitie 17.200 9/24/2025 CHF 42.740 DZ Bank AG Deutsc 18.500 3/28/2025 EUR 10.150 DZ Bank AG Deutsc 17.600 6/27/2025 EUR 12.400 Raiffeisen Schwei 15.000 3/18/2025 CHF 28.940 Leonteq Securitie 22.600 6/24/2025 CHF 49.120 Bank Julius Baer 17.100 3/19/2025 CHF 25.600 Landesbank Baden- 16.000 6/27/2025 EUR 9.450 Landesbank Baden- 11.000 2/27/2026 EUR 13.460 Bank Vontobel AG 20.000 7/31/2025 CHF 45.900 Leonteq Securitie 16.200 8/8/2025 CHF 48.730 Leonteq Securitie 14.000 10/15/2025 CHF 35.000 Leonteq Securitie 19.000 7/15/2025 USD 40.350 Swissquote Bank E 19.340 8/5/2025 USD 35.570 Leonteq Securitie 14.000 9/3/2025 CHF 50.850 BNP Paribas Emiss 15.000 9/25/2025 EUR 42.590 Bank Vontobel AG 14.250 5/30/2025 USD 25.800 Landesbank Baden- 13.000 4/24/2026 EUR 17.220 Bank Julius Baer 18.500 7/2/2025 CHF 39.300 Landesbank Baden- 11.500 4/24/2026 EUR 15.720 Swissquote Bank S 24.070 5/6/2025 CHF 32.240 Swissquote Bank E 17.590 4/22/2025 USD 30.550 Societe Generale 11.140 4/2/2026 USD 47.600 Raiffeisen Schwei 18.000 7/15/2025 CHF 39.060 Leonteq Securitie 16.400 10/15/2025 CHF 41.530 Corner Banca SA 18.800 6/26/2025 CHF 40.660 Leonteq Securitie 15.400 7/1/2025 CHF 38.670 Societe Generale 16.000 3/18/2027 USD 49.060 Bank Vontobel AG 12.000 3/19/2026 CHF 35.000 Landesbank Baden- 11.500 2/28/2025 EUR 6.930 Landesbank Baden- 15.000 2/28/2025 EUR 5.900 Leonteq Securitie 10.500 5/15/2025 CHF 34.610 Vontobel Financia 16.000 3/28/2025 EUR 5.850 Swissquote Bank E 25.320 2/26/2025 CHF 23.870 Bank Julius Baer 12.000 5/28/2025 USD 28.050 Bank Vontobel AG 26.000 3/5/2025 CHF 27.200 Bank Vontobel AG 12.000 3/5/2025 CHF 21.600 Bank Vontobel AG 14.000 3/5/2025 CHF 7.200 Basler Kantonalba 17.000 9/5/2025 USD 45.370 Bank Julius Baer 18.690 3/7/2025 CHF 23.000 Basler Kantonalba 14.200 9/17/2025 CHF 32.320 DZ Bank AG Deutsc 13.200 3/28/2025 EUR 30.730 DZ Bank AG Deutsc 18.300 3/28/2025 EUR 8.300 DZ Bank AG Deutsc 15.000 3/28/2025 EUR 9.000 DZ Bank AG Deutsc 21.200 3/28/2025 EUR 30.060 DZ Bank AG Deutsc 10.500 3/28/2025 EUR 50.530 Raiffeisen Switze 13.000 3/11/2025 CHF 26.430 Raiffeisen Switze 16.500 3/11/2025 CHF 8.120 Swissquote Bank E 18.530 3/5/2025 CHF 43.600 Landesbank Baden- 12.000 2/27/2026 EUR 14.260 Leonteq Securitie 14.500 2/27/2025 CHF 23.180 Landesbank Baden- 10.500 2/28/2025 EUR 43.800 Bank Julius Baer 14.000 6/4/2025 CHF 30.550 Leonteq Securitie 15.000 11/19/2025 CHF 46.730 Bank Vontobel AG 15.000 4/29/2025 CHF 24.500 Bank Vontobel AG 11.000 4/29/2025 CHF 25.700 Leonteq Securitie 20.000 3/11/2025 CHF 7.670 Inecobank CJSC 10.000 4/28/2025 AMD 8.849 Raiffeisen Switze 10.500 4/2/2025 EUR 47.200 UniCredit Bank Gm 16.550 8/18/2025 USD 13.450 Landesbank Baden- 10.500 1/2/2026 EUR 10.880 Leonteq Securitie 22.000 3/28/2025 CHF 49.590 UniCredit Bank Gm 11.200 12/28/2026 EUR 47.840 Corner Banca SA 10.000 2/25/2025 CHF 44.870 Leonteq Securitie 10.000 2/25/2025 CHF 44.500 UBS AG/London 11.000 2/17/2025 EUR 44.950 Landesbank Baden- 14.000 6/27/2025 EUR 8.230 Landesbank Baden- 16.000 6/27/2025 EUR 8.480 Landesbank Baden- 19.000 6/27/2025 EUR 9.180 Landesbank Baden- 21.000 6/27/2025 EUR 9.600 Zurcher Kantonalb 10.000 3/27/2025 EUR 45.620 Bank Vontobel AG 10.500 2/19/2025 EUR 46.400 Corner Banca SA 13.000 4/2/2025 CHF 48.050 Landesbank Baden- 13.000 3/28/2025 EUR 5.350 Landesbank Baden- 15.000 3/28/2025 EUR 5.070 Landesbank Baden- 11.000 3/28/2025 EUR 5.760 UBS AG/London 15.000 8/21/2025 USD 45.550 Leonteq Securitie 17.000 7/29/2025 CHF 49.350 UniCredit Bank Gm 11.500 2/28/2025 EUR 48.850 DZ Bank AG Deutsc 12.100 3/28/2025 EUR 45.650 DZ Bank AG Deutsc 18.600 3/28/2025 EUR 37.260 Swissquote Bank S 14.080 2/20/2025 CHF 48.960 DZ Bank AG Deutsc 13.500 3/28/2025 EUR 45.060 DZ Bank AG Deutsc 15.400 3/28/2025 EUR 49.590 Leonteq Securitie 10.340 8/31/2026 EUR 39.060 Armenian Economy 11.000 10/3/2025 AMD 0.000 Landesbank Baden- 14.000 10/24/2025 EUR 11.760 Landesbank Baden- 10.000 10/24/2025 EUR 10.190 Bank Vontobel AG 12.750 4/14/2025 USD 50.700 UBS AG/London 10.250 3/10/2025 EUR 37.400 UBS AG/London 25.000 10/20/2026 USD 10.910 Corner Banca SA 20.000 3/5/2025 USD 47.200 Erste Group Bank 10.750 3/31/2026 EUR 41.600 Bank Vontobel AG 10.500 5/12/2025 EUR 37.900 National Mortgage 12.000 3/30/2026 AMD 0.000 Evocabank CJSC 11.000 9/27/2025 AMD 0.000 ACBA Bank OJSC 11.000 12/1/2025 AMD 0.000 DZ Bank AG Deutsc 12.100 3/28/2025 EUR 48.380 HSBC Trinkaus & B 13.300 6/27/2025 EUR 22.460 Banque Internatio 10.000 3/19/2025 EUR 50.500 Landesbank Baden- 14.000 6/27/2025 EUR 8.350 Barclays Bank PLC 21.500 12/26/2025 USD 22.470 HSBC Trinkaus & B 13.400 3/28/2025 EUR 20.800 Landesbank Baden- 10.000 6/27/2025 EUR 8.490 HSBC Trinkaus & B 11.600 3/28/2025 EUR 22.760 Bank Julius Baer 12.720 2/17/2025 CHF 16.150 Citigroup Global 25.530 2/18/2025 EUR 0.010 Societe Generale 23.110 2/17/2025 USD 45.550 Ameriabank CJSC 10.000 2/20/2025 AMD 0.000 Leonteq Securitie 10.000 5/26/2025 CHF 43.870 UniCredit Bank Gm 10.500 4/7/2026 EUR 26.220 Raiffeisen Switze 10.300 6/11/2025 CHF 47.040 HSBC Trinkaus & B 15.900 3/28/2025 EUR 18.180 HSBC Trinkaus & B 15.000 3/28/2025 EUR 18.810 HSBC Trinkaus & B 11.300 6/27/2025 EUR 24.150 BNP Paribas Issua 20.000 9/18/2026 EUR 12.500 HSBC Trinkaus & B 22.250 6/27/2025 EUR 7.600 HSBC Trinkaus & B 11.750 6/27/2025 EUR 42.120 UniCredit Bank Gm 10.500 12/22/2025 EUR 31.760 HSBC Trinkaus & B 17.500 6/27/2025 EUR 6.000 HSBC Trinkaus & B 12.750 6/27/2025 EUR 4.410 HSBC Trinkaus & B 10.250 6/27/2025 EUR 47.200 HSBC Trinkaus & B 15.500 6/27/2025 EUR 46.790 HSBC Trinkaus & B 16.000 3/28/2025 EUR 18.530 HSBC Trinkaus & B 11.000 3/28/2025 EUR 23.320 HSBC Trinkaus & B 13.400 6/27/2025 EUR 22.910 HSBC Trinkaus & B 16.300 3/28/2025 EUR 3.990 HSBC Trinkaus & B 15.100 3/28/2025 EUR 19.210 HSBC Trinkaus & B 11.500 6/27/2025 EUR 24.750 HSBC Trinkaus & B 14.400 3/28/2025 EUR 4.070 Armenian Economy 10.500 5/4/2025 AMD 0.000 UBS AG/London 21.600 8/2/2027 SEK 14.160 Lehman Brothers T 13.000 7/25/2012 EUR 0.100 Lehman Brothers T 18.250 10/2/2008 USD 0.100 Lehman Brothers T 15.000 3/30/2011 EUR 0.100 Lehman Brothers T 14.900 9/15/2008 EUR 0.100 Lehman Brothers T 12.000 7/13/2037 JPY 0.100 Lehman Brothers T 10.000 6/11/2038 JPY 0.100 Lehman Brothers T 13.000 12/14/2012 USD 0.100 Lehman Brothers T 13.500 6/2/2009 USD 0.100 Lehman Brothers T 13.432 1/8/2009 ILS 0.100 Lehman Brothers T 16.000 10/28/2008 USD 0.100 Lehman Brothers T 10.442 11/22/2008 CHF 0.100 Lehman Brothers T 12.400 6/12/2009 USD 0.100 Lehman Brothers T 10.000 6/17/2009 USD 0.100 Lehman Brothers T 11.000 7/4/2011 CHF 0.100 Lehman Brothers T 12.000 7/4/2011 EUR 0.100 Lehman Brothers T 13.150 10/30/2008 USD 0.100 Lehman Brothers T 11.000 7/4/2011 USD 0.100 Lehman Brothers T 16.000 12/26/2008 USD 0.100 Lehman Brothers T 14.100 11/12/2008 USD 0.100 Lehman Brothers T 16.800 8/21/2009 USD 0.100 Lehman Brothers T 11.250 12/31/2008 USD 0.100 Lehman Brothers T 10.600 4/22/2014 MXN 0.100 Lehman Brothers T 14.900 11/16/2010 EUR 0.100 Lehman Brothers T 16.000 10/8/2008 CHF 0.100 Lehman Brothers T 10.000 10/22/2008 USD 0.100 Lehman Brothers T 16.200 5/14/2009 USD 0.100 Lehman Brothers T 16.000 11/9/2008 USD 0.100 Lehman Brothers T 10.000 5/22/2009 USD 0.100 Lehman Brothers T 17.000 6/2/2009 USD 0.100 Lehman Brothers T 11.750 3/1/2010 EUR 0.100 Lehman Brothers T 11.000 2/16/2009 CHF 0.100 Lehman Brothers T 10.000 2/16/2009 CHF 0.100 Lehman Brothers T 13.000 2/16/2009 CHF 0.100 Sidetur Finance B 10.000 4/20/2016 USD 0.930 Tonon Luxembourg 12.500 5/14/2024 USD 2.216 Credit Agricole C 29.699 12/29/2031 EUR 46.529 Lehman Brothers T 11.000 12/19/2011 USD 0.100 Lehman Brothers T 13.500 11/28/2008 USD 0.100 Petromena ASA 10.850 11/19/2018 USD 0.622 Teksid Aluminum L 12.375 7/15/2011 EUR 0.619 PA Resources AB 13.500 3/3/2016 SEK 0.124 Phosphorus Holdco 10.000 4/1/2019 GBP 0.309 Privatbank CJSC V 10.875 2/28/2018 USD 4.824 Lehman Brothers T 10.500 8/9/2010 EUR 0.100 Lehman Brothers T 11.000 6/29/2009 EUR 0.100 Lehman Brothers T 10.000 3/27/2009 USD 0.100 ********* 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 2025. All rights reserved. ISSN 1529-2754. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. The TCR Europe subscription rate is US$775 per half-year, delivered via e-mail. Additional e-mail subscriptions for members of the same firm for the term of the initial subscription or balance thereof are US$25 each. For subscription information, contact Peter Chapman at 215-945-7000. * * * End of Transmission * * *