251211.mbx

251211.mbx T R O U B L E D C O M P A N Y R E P O R T E R E U R O P E Thursday, December 11, 2025, Vol. 26, No. 247 Headlines F R A N C E EUROPCAR MOBILITY:S&P Alters Outlook to Positive, Affirms 'B-' ICR G R E E C E PIRAEUS FINANCIAL: S&P Places 'BB-' LT ICR on CreditWatch Positive I R E L A N D AVOCA CLO XXXIV: Fitch Assigns 'B-(EXP)sf' Rating to Class F Notes BAIN CAPITAL 2018-1: Fitch Lowers Rating on Cl. F Notes to 'CCCsf' CARLYLE GLOBAL 2014-2: Fitch Lowers Rating on Cl. E-R Notes to B-sf CONTEGO CLO XII: Fitch Assigns 'B-sf' Final Rating to Cl. F-R Notes ELM PARK: Fitch Assigns 'B-(EXP)sf' Rating to Class F Notes MARGAY CLO IV: Fitch Assigns 'B-sf' Final Rating to Class F Notes I T A L Y ENGINEERING INGEGNERIA: Fitch Affirms 'B' IDR, Outlook Stable N E T H E R L A N D S EBN FINANCE: Fitch Affirms 'CCC' Sr. Unsec. Debt Rating HILL FL 2023-1: Fitch Lowers Rating on Class D Notes to 'BB+sf' UNITED GROUP: S&P Rates New EUR400MM Sr. Secured Notes 'B' R U S S I A SQB INSURANCE: Fitch Affirms 'BB' Long-Term IDR, Outlook Stable S P A I N FTA UCI 16: Fitch Hikes Rating on Class C Notes to 'B-sf' S W E D E N ASMODEE GROUP: S&P Rates Proposed EUR320MM Fixed-Rate Notes 'BB-' POLESTAR AUTOMOTIVE: ADS Ratio Change to 1:30 Takes Effect Dec. 9 U N I T E D K I N G D O M ARINIUM LTD: FRP Advisory Appointed as Joint Administrators BARLEY HILL NO. 2: S&P Lowers X-Dfrd Notes Rating to 'CCC (sf)' F4CONTRO LTD: Opus Restructuring Appointed as Joint Administrators GLOW INSULATION: Alvarez & Marsal Appointed as Joint Administrators KANABO GROUP: RSM UK Advisory Appointed as Joint Administrators NATIONAL TIMBER GROUP: Alvarez & Marsal Appointed as Administrators NATIONAL TIMBER: Alvarez & Marsal Appointed as Administrators NORTHROW LIMITED: Kroll Advisory Appointed as Joint Administrators PETROFAC LTD: S&P Withdraws 'D' ICR After Administration Filing SCOTIA ROOFING: Alvarez & Marsal Appointed as Joint Administrators SHERWOOD PARENTCO: Fitch Lowers LongTerm IDR to 'B', Outlook Stable - - - - - =========== F R A N C E =========== EUROPCAR MOBILITY:S&P Alters Outlook to Positive, Affirms 'B-' ICR ------------------------------------------------------------------ S&P Global Ratings revised its outlook on France-based car rental company Europcar Mobility Group SA (Europcar) and Europcar International SASU to positive from stable, while affirming its 'B-' long-term issuer credit ratings, and its 'B' issue rating on the EUR500 million fleet bond issued by EC Finance PLC. S&P said, "The positive outlook indicates that we could raise our ratings on Europcar following Europcar's further integration within VW group, with Europcar getting access to letters of comfort and cash pooling from VW group, while gradually improving its operating performance. "S&P Global Ratings expects Europcar will benefit from stronger ongoing support from its main shareholder VW after it becomes a fully consolidated subsidiary of the VW group. This is because, as a fully consolidated subsidiary, Europcar will benefit from the same conditions as other consolidated entities of the group. In particular, we expect Europcar to become part of VW's cash pooling system and benefit from letters of comfort for group subsidiaries. The consolidation of Europcar into VW group is linked to the increase VW's stake in Europcar to 93% from 66%, which we expect to result from the pending settlement of Attestor's put option. To date, the VW group has provided Europcar with a EUR500 million term loan, operating leases, and a EUR400 million shareholder loan. We still assess Europcar as a moderately strategic subsidiary of VW. We think Europcar's fleet management capabilities and network could play an important role for VW to develop an integrated mobility platform covering customers' key mobility needs, including through subscription and car-sharing products. At the same time, we believe it will take time for Europcar to achieve a structurally better growth and profitability profile, and we anticipate Europcar's earnings and cash contribution to the VW group will remain limited over the next few years. These considerations represent limiting factors when assessing Europcar's strategic importance to the group. "Our 2025-2026 base case scenario for Europcar remains unchanged compared to our report published June 24, 2025. We think that Europcar's turnaround plan will continue to gradually translate into lower costs and better asset yields. The renewed management team, led by CEO Sebastian Birkel and CFO Joachim Hinz, focuses on improving performance, targeting optimized utilization rates and pricing through tighter management of the fleet, a new loyalty program, and investments in digital capabilities with respect to yield management and customer experience. At the same time, Europcar is looking to reduce costs related to the fleet and selling, general, and administrative expenses, while also moving to a more asset-light model by increasing the share of franchisees. We expect these measures will result in meaningfully lower costs from 2026. In 2025, we forecast that Europcar's EBIT interest cover will remain subdued at 0.2x-0.4x, compared to 0.2x in 2024. In 2026, we expect the company's corporate EBITDA (before IFRS16 adjustments) to improve to EUR125 million-EUR175 million, from EUR25 million-EUR75 million expected in 2025, after negative EUR35 million in 2024. Corporate EBITDA corresponds to operating income plus non-fleet depreciation, amortization, and impairment, less net fleet financing expenses. We note that, as of June 30, 2025, Europcar further decreased the share of its fleet comprising vehicles at risk of market value declines to about 40% from 50% as of Dec. 31, 2024, thereby somewhat reducing risks from price fluctuations in the used-car market. "We expect Europcar will manage its debt maturity profile. Europcar's next meaningful debt maturities include its EUR500 million fleet bond due in October 2026, its senior asset-backed facility totaling EUR1,825 million maturing in July 2027, its EUR342.5 million revolving credit facility maturing in August 2027, and the EUR500 million VW Bank term loan terminating in November 2027. We note that the EUR500 million fleet bond is now due in less than 12 months, but we believe that VW would be prepared to extend further loans to Europcar if needed. "The positive outlook indicates that we could raise our ratings on Europcar following Europcar's further integration within VW Group, translating into Europcar getting access to letters of comfort and cash pooling from VW group. At the same time, we expect that Europcar will gradually improve its operating performance, for example through cost reduction and better yield management. "We could revise our outlook to stable if we saw a lower likelihood of Europcar becoming a fully consolidated subsidiary of VW, or we observed slower progress with Europcar's operating turnaround strategy. "We could raise our rating on Europcar after VW substantially increases its ownership stake in the company and this leads to a higher degree of ongoing support, for example through letters of comfort and access to VW group's cash pooling system. We would also expect initiatives to improve Europcar's yield management and cost structure, supporting structurally higher profitability, accompanied by stable market shares and modest top-line growth in key markets." This would help increase the company's S&P Global Ratings-adjusted EBIT interest coverage ratio to close to 1x on a sustainable basis, in addition to maintaining an adequate liquidity position. =========== G R E E C E =========== PIRAEUS FINANCIAL: S&P Places 'BB-' LT ICR on CreditWatch Positive ------------------------------------------------------------------ S&P Global Ratings placed its 'BB-' long-term issuer credit ratings on Piraeus Financial Holdings S.A., its long-term ratings on Piraeus Holdings' EMT program, and the 'CCC' rating on a junior subordinated instrument on CreditWatch with positive implications. S&P also affirmed its 'B' short-term issuer credit ratings on Piraeus Holdings and the EMT program. At the same time, S&P affirmed its 'BB+/B' long- and short-term issuer credit rating ratings on Piraeus Bank S.A. and maintained the stable outlook. S&P's stable outlook on Piraeus Bank reflects its expectation that it will preserve its creditworthiness over the next 12 months, supported by Greece's benign economic environment. S&P could lower the long-term rating on Piraeus Bank if: -- The bank's earnings capacity deteriorates or its appetite for acquisitions increases in a manner that erodes its capital base or materially weakens operating efficiency. -- S&P sees credit risks building on the back of rapid lending growth. S&P could raise its rating on Piraeus Bank if it sees its capitalization strengthening, with its RAC ratio exceeding 7% on a sustained basis. ============= I R E L A N D ============= AVOCA CLO XXXIV: Fitch Assigns 'B-(EXP)sf' Rating to Class F Notes ------------------------------------------------------------------ Fitch Ratings has assigned Avoca CLO XXXIV DAC expected ratings. The assignment of the final ratings is contingent on the final documents conforming to information reviewed. Entity/Debt Rating ----------- ------ Avoca CLO XXXIV DAC Class A Loan LT AAA(EXP)sf Expected Rating Class A Notes LT AAA(EXP)sf Expected Rating Class B Notes LT AA(EXP)sf Expected Rating Class C Notes LT A(EXP)sf Expected Rating Class D Notes LT BBB-(EXP)sf Expected Rating Class E Notes LT BB-(EXP)sf Expected Rating Class F Notes LT B-(EXP)sf Expected Rating Subordinated Notes LT NR(EXP)sf Expected Rating Transaction Summary Avoca CLO XXXIV DAC is a securitisation of mainly (at least 90%) senior secured obligations 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 EUR400 million. The portfolio is actively managed by KKR Credit Advisors (Ireland). The collateralised loan obligation (CLO) will have a 4.6-year reinvestment period and an 8.5-year weighted average life (WAL) test at closing. KEY RATING DRIVERS Average Portfolio Credit Quality (Neutral): Fitch assesses the average credit quality of obligors in the identified portfolio to be in the 'B' category. The Fitch-calculated weighted average rating factor (WARF) of the identified portfolio is 24.1. High Recovery Expectations (Positive): At least 90% of the portfolio will comprise senior secured obligations. The recovery prospects for these assets is more favourable than for second-lien, unsecured and mezzanine assets. The Fitch-calculated weighted average recovery rate (WARR) of the identified portfolio is 60.6%. Diversified Asset Portfolio (Positive): The deal will have a concentration limit for the 10 largest obligors of 20% and will include other concentration limits, including a maximum exposure to the three-largest Fitch-defined industries in the portfolio of 40%. These covenants ensure the asset portfolio will not be exposed to excessive concentration. Portfolio Management (Neutral): The transaction will have a reinvestment period of about 4.6 years and include reinvestment criteria similar to those of other European deals. Its analysis is based on a stressed-case portfolio with the aim of testing the robustness of the deal structure against its covenants and portfolio guidelines. Cash Flow Modelling (Neutral): The WAL used for the transaction's Fitch-stressed portfolio and matrices analysis is 12 months less than the WAL test covenant at the issue date, accounting for strict reinvestment conditions after the reinvestment period. These include the satisfaction of the coverage tests and the Fitch 'CCC' limitation test, together with a WAL test covenant that gradually reduces 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 An increase of the default rate (RDR) in the identified portfolio by 25% of the mean RDR and a decrease of the recovery rate (RRR) by 25% at all ratings would have no impact on the class A and C notes, lead to downgrades of one notch each for the class B, D, and E notes and to below 'B-sf' for the class F notes. Downgrades may occur if the build-up of the notes' credit enhancement following amortisation does not compensate for a larger loss expectation than assumed due to unexpectedly high levels of defaults and portfolio deterioration. The class B, D and E notes each have a rating cushion of two notches, while the class C and F notes have a cushion of one notch each, due to the better metrics and shorter life of the identified portfolio than the Fitch-stressed portfolio. 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 three notches each for the class A, C, and D notes, four notches for the class B notes and to below 'B-sf' for the class E and F notes. Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade A reduction of the RDR by 25% of the mean RDR and an increase in the RRR by 25% at all rating levels in the Fitch-stressed portfolio would result in upgrades of up to three notches each for all notes, except for the 'AAAsf' rated notes. Upgrades during the reinvestment period, 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. Upgrades after the end of the reinvestment period 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 The majority of the underlying assets or risk-presenting entities have ratings or credit opinions from Fitch and other Nationally Recognised Statistical Rating Organisations and European Securities and Markets Authority- registered rating agencies. Fitch has relied on the practices of the relevant groups within Fitch and 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 its analysis according to its applicable rating methodologies indicates that it is adequately reliable. ESG Considerations Fitch does not provide ESG relevance scores for Avoca CLO XXXIV 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. BAIN CAPITAL 2018-1: Fitch Lowers Rating on Cl. F Notes to 'CCCsf' ------------------------------------------------------------------ Fitch Ratings has downgraded Bain Capital Euro 2018-1 DAC class F notes to 'CCCsf' from 'B-sf ' and affirmed the rest. Entity/Debt Rating Prior ----------- ------ ----- Bain Capital Euro CLO 2018-1 DAC B-1 XS1713469168 LT AAAsf Affirmed AAAsf B-2 XS1713465257 LT AAAsf Affirmed AAAsf C XS1713468194 LT AAAsf Affirmed AAAsf D XS1713467469 LT A+sf Affirmed A+sf E XS1713467030 LT BB+sf Affirmed BB+sf F XS1713466909 LT CCCsf Downgrade B-sf Transaction Summary Bain Capital Euro CLO 2018-1 DAC is a cash flow CLO comprising mostly senior secured obligations. The transaction is actively managed by Bain Capital Credit, Ltd. and exited its reinvestment period in April 2022. KEY RATING DRIVERS Junior Notes Sensitive to Par Loss: The transaction has experienced further par losses since the last review in May 2025 and is currently 6.3% below par. The class F par value test has been failing since June 2024 and the ratio has decreased further to 97.4% currently, from 99.6% in May 2025. The portfolio has EUR7.9 million of defaulted assets and EUR15.4 million (or 16.8% of the portfolio) of Fitch 'CCC' obligations. Exposure to obligors with a Negative Outlook is 17.4%, as calculated by Fitch. Fitch estimates the current market value of the portfolio to be below the outstanding balance of the rated notes, making a repayment in full by liquidation unlikely for the class F notes. Fitch acknowledges that market values may be volatile, resulting in substantial credit risk for the class F notes, which leads to the downgrade to 'CCCsf'. Amortisation Improves Credit Enhancement: The transaction has, since the last review, repaid EUR31.5 million and the class B notes have been 76.6% paid down. The benefit from amortisation outweighs further par losses that have occurred since the previous review and increased the credit enhancement of the class B to E notes, leading to their affirmations. 'B'/'B-' Portfolio: Fitch assesses the average credit quality of the underlying obligors at 'B'/'B-'. Fitch calculated, under its latest criteria, the weighted average rating factor at 31.3 for the current portfolio and 32.8 for the stressed portfolio for which Fitch has adjusted assets on Negative Outlook downward by one notch. Moderately Diversified Portfolio: The portfolio is moderately diversified across obligors, countries and industries, although the top 10 obligor and the largest obligor concentrations are 33.1% and 4%, respectively, failing their respective limits of 18% and 3%. Exposure to the three largest Fitch-defined industries is 33%. The fixed-rate assets constitute 8.3% of the portfolio, below a limit of 10%. Transaction Outside Reinvestment Period: The transaction exited its reinvestment period in April 2022, and the senior notes are deleveraging. However, the transaction cannot reinvest due to the failure of the Fitch 'CCC' limit and the class F par value tests. The manager's inability to reinvest means Fitch's downgrade analysis is based on the current portfolio, and the upgrade analysis is based on a Fitch-stressed portfolio for which Fitch has notched down assets on Negative Outlook and floored the weighted average life at four years. Deviation from Model Implied Rating: The class D notes are rated three notches below the model-implied rating (MIR) to avoid unjustified rating volatility at high rating levels. The portfolio will become more concentrated as deleveraging continues. In addition, there is a sizable Fitch 'CCC' bucket and the market value of these lower rated assets has shown high volatility. RATING SENSITIVITIES Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade Downgrades may occur if the loss expectation is larger than 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 Bain Capital Euro CLO 2018-1 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 GLOBAL 2014-2: Fitch Lowers Rating on Cl. E-R Notes to B-sf ------------------------------------------------------------------- Fitch Ratings has upgraded five tranches of Carlyle Global Market Strategies Euro CLO 2014-2 DAC, downgraded one and affirmed the rest. The Outlooks are Stable, except the class E notes, which are on Negative Outlook. Entity/Debt Rating Prior ----------- ------ ----- Carlyle Global Market Strategies Euro CLO 2014-2 DAC A-1-RRR XS2339018223 LT AAAsf Affirmed AAAsf A-2A-RRR XS2339019460 LT AAAsf Upgrade AA+sf A-2B-RRR XS2339020476 LT AAAsf Upgrade AA+sf B-1-R XS1898112922 LT AAsf Upgrade A+sf B-2-R XS1898113227 LT AAsf Upgrade A+sf C-R XS1898113656 LT A+sf Upgrade BBB+sf D-R XS1898116162 LT BBsf Affirmed BBsf E-R XS1898116246 LT B-sf Downgrade Bsf Transaction Summary Carlyle Global Market Strategies Euro CLO 2014-2 DAC is a cash flow CLO comprising mostly senior secured obligations. The transaction is actively managed by CELF Advisors LLP and exited its reinvestment period in May 2023. KEY RATING DRIVERS Transaction Deleveraging: About EUR108.4 million of the A-1-RRR notes have been repaid since its last review in January 2024. This deleveraging has resulted in an increase in credit enhancement for the class A-1-RRR to D-R notes. The upgrades of the class A-2A-RRR, A-2B-RRR, B-1-R, B-2-R and C-R notes and their Stable Outlooks reflect sufficient default-rate cushions at their model-implied ratings. Portfolio Deterioration: The transaction was around 5.1% below par (calculated as the current par difference over the original target par), with around EUR1.7 million defaulted assets in the portfolio, based on the latest trustee report. The downgrade of the class E notes and their Negative Outlook reflect an insufficient default-rate cushion against credit quality deterioration, with 17.4% of the portfolio exposed to assets with an Issuer Default Rating on Negative Outlook. Portfolio Concentration Increasing: The top 10 obligor concentration of the portfolio, as calculated by Fitch, is 25.1%, above the limit of 20% and the largest obligor represents 2.7% of the portfolio balance. This has increased, since the last review in January, from a top 10 concentration of 14.4% and a largest obligor concentration of 1.7% 2025. Exposure to the three largest Fitch-defined industries is 21.2%, as calculated by the trustee. Fitch expects the portfolio concentration to increase as the transaction continues to pay down. This underlines the Negative Outlook on the class E notes and the class B-1-R and B-2-R notes' deviation from their model-implied ratings. Low Refinancing Risks: The transaction has manageable near- and medium-term refinancing risk, with 0.3% of the portfolio maturing in 2026 and 3.1% maturing in 2027. 'B'/'B-' Portfolio: Fitch assesses the average credit quality of the obligors at 'B'/'B-'. The Fitch-calculated weighted average rating factor of the current portfolio is 27.6. High Recovery Expectations: Senior secured obligations comprise 100% 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 recovery rate of the current portfolio as reported by the trustee is 61.4%. Transaction Outside Reinvestment Period: The transaction exited its reinvestment period in May 2023, and the most senior notes are deleveraging. The transaction is failing its weighted average rating factor test (WARF) from another rating agency, which is required to be satisfied before reinvestment, and therefore cannot purchase assets. It is also failing the weighted average life test and Fitch weighted average recovery rate test, which are on a maintain-or -improve basis. However, if the manager were to cure the failing WARF test, they could continue to reinvest sale proceeds from the sale of credit risk obligations and unscheduled principal proceeds. Given the manager's potential to continue to reinvest, Fitch's analysis is based on a stressed portfolio and tested the notes' achievable ratings across the Fitch matrix, since the portfolio can still migrate to different collateral quality tests. Deviation from Model-Implied Ratings: The class B-1-R and B-2-R notes are two notches below their model-implied ratings, reflecting the high concentration in the portfolio, which Fitch expects to increase further as the transaction deleverages. RATING SENSITIVITIES Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade Downgrades may occur if the loss expectation is larger than 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 Carlyle Global Market Strategies Euro CLO 2014-2 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. CONTEGO CLO XII: Fitch Assigns 'B-sf' Final Rating to Cl. F-R Notes ------------------------------------------------------------------- Fitch Ratings has assigned Contego CLO XII DAC reset notes final ratings, as detailed below. Entity/Debt Rating Prior ----------- ------ ----- Contego CLO XII DAC A XS2708631598 LT PIFsf Paid In Full AAAsf A-R XS3219379933 LT AAAsf New Rating B XS2708631911 LT PIFsf Paid In Full AAsf B-R XS3219380279 LT AAsf New Rating C XS2708632133 LT PIFsf Paid In Full Asf C-R XS3219380436 LT Asf New Rating D XS2708632307 LT PIFsf Paid In Full BBB-sf D-R XS3219380600 LT BBB-sf New Rating E XS2708632489 LT PIFsf Paid In Full BB-sf E-R XS3219380865 LT BB-sf New Rating F XS2708632992 LT PIFsf Paid In Full B-sf F-R XS3219381087 LT B-sf New Rating X XS3219379776 LT AAAsf New Rating Transaction Summary Contego CLO XII 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 redeem all the existing notes, except the subordinated notes, and to fund a portfolio with a target par of EUR400 million. The portfolio is actively managed by Five Arrows Managers LLP. The CLO has a 4.6-year reinvestment period, and an 8.6-year weighted average life (WAL) test at closing. 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 25.6. 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 of the identified portfolio is 61.5%. Diversified Asset Portfolio (Positive): The transaction 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. Portfolio Management (Neutral): The transaction includes three matrix sets, each based on a top 10 obligor limit of 20%. Two matrices are effective at closing, corresponding to fixed-rate asset limits of 5% and 12.5%, and to an 8.6-year WAL test. The remaining two matrix sets correspond to a 7.6-year and 7.1-year WAL test, with the same fixed-rate asset limits as the closing matrices. The two forward matrix sets can be elected by the manager 12 months and 18 months after closing, subject to the collateral principal amount (with defaults carried at Fitch collateral value) being at least equal to the reinvestment target par balance. The transaction has a 4.6-year reinvestment period and includes reinvestment criteria similar to those of other European transactions. Fitch's analysis is based on a stressed-case portfolio with the aim of testing the robustness of the transaction structure against its covenants and portfolio guidelines. Cash Flow Modelling (Positive): The WAL used for the transaction's Fitch-stressed portfolio and matrices analysis is 12 months less than the WAL covenant, to account for structural and reinvestment conditions after the reinvestment period, including passing the over-collateralisation tests and Fitch 'CCC' limitation after reinvestment. 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 lead to downgrades of one notch each for the class B-R to D-R notes, two notches for the class E-R notes, to below 'B-sf' for the class F-R notes. It would have no impact on the class X, and A-R notes. Based on the identified portfolio, downgrades may occur if the loss expectation is larger than assumed, due to unexpectedly high levels of default and portfolio deterioration. The class B-R, D-R, E-R and F-R notes have two-notch cushions, and the class C-R notes a one-notch cushion, due to the better metrics and shorter life of the identified portfolio than the Fitch-stressed portfolio. There is no rating cushion for the class X and A-R notes. Should the cushion between the identified portfolio and the Fitch-stressed portfolio be eroded 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 for the 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 three notches, 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 transaction's remaining life. 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 Contego CLO XII DAC 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 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 Contego CLO XII 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. ELM PARK: Fitch Assigns 'B-(EXP)sf' Rating to Class F Notes ----------------------------------------------------------- Fitch Ratings has assigned Elm Park CLO DAC reset notes expected ratings, as detailed below. The assignment of the final ratings is contingent on the receipt of documents conforming to information already reviewed. Entity/Debt Rating ----------- ------ Elm Park CLO DAC X XS3231162028 LT AAA(EXP)sf Expected Rating A Loan LT AAA(EXP)sf Expected Rating A XS3224514664 LT AAA(EXP)sf Expected Rating B XS3224514821 LT AA(EXP)sf Expected Rating C XS3224515125 LT A(EXP)sf Expected Rating D XS3224515471 LT BBB-(EXP)sf Expected Rating E XS3224515638 LT BB-(EXP)sf Expected Rating F XS3224515802 LT B-(EXP)sf Expected Rating Subordinated Notes XS1401842502 LT NR(EXP)sf Expected Rating Transaction Summary Elm Park CLO 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. On the issue date, the new notes will refinance the existing notes except for the subordinated notes. The portfolio is actively managed by Blackstone Ireland Limited. The collateralised loan obligation (CLO) will have a 4.5-year reinvestment period and a 7.5-year weighted average life (WAL) test covenant at closing. 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 (WARF) of the identified portfolio is 24.7. High Recovery Expectations (Positive): At least 90% of the portfolio will comprise senior secured obligations. Fitch views the recovery prospects for these assets as more favourable than for second-lien, unsecured and mezzanine assets. The Fitch weighted average recovery rate (WARR) of the identified portfolio is 60.4%. Diversified Portfolio (Positive): The transaction includes various concentration limits in the portfolio, including a top 10 obligor concentration limit at 25% (or a lower percentage in relation to Fitch test matrices) and a maximum exposure to the three largest Fitch-defined industries 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 year on or after the step-up date, which is 12 months after closing. The WAL extension is subject to conditions, including passing the collateral quality and coverage tests and the collateral principal amount being at least equal to the reinvestment target par balance. Portfolio Management (Neutral): The transaction will have a 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. Cash Flow Modelling (Positive): The WAL used for the transaction's Fitch-stressed portfolio and matrices analysis is 12 months less than the WAL covenant, to account for strict reinvestment conditions after the reinvestment period, including the satisfaction of over-collateralisation test and Fitch's 'CCC' limit test, together with a gradually reducing WAL covenant. Fitch believes these conditions 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 notes, and lead to downgrades of one notch each for the class 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 assumed, due to unexpectedly high levels of default and portfolio deterioration. The class B, C, D, E and F notes each have a cushion of two notches due to the better metrics and shorter life of the identified portfolio than the Fitch-stressed portfolio. 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 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 Fitch-stressed portfolio would lead to upgrades of up to three notches each for the notes, except for the 'AAAsf' rated notes. Upgrades during the reinvestment period, 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. Upgrades after the end of the reinvestment period 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 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 Elm Park CLO 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. MARGAY CLO IV: Fitch Assigns 'B-sf' Final Rating to Class F Notes ----------------------------------------------------------------- Fitch Ratings has assigned Margay CLO IV DAC final ratings, as detailed below. Entity/Debt Rating ----------- ------ Margay CLO IV DAC Class A Notes XS3207995468 LT AAAsf New Rating Class A-1 Loan LT AAAsf New Rating Class A-2 Loan LT AAAsf New Rating Class B XS3207995625 LT AAsf New Rating Class C XS3207996359 LT Asf New Rating Class D XS3207996516 LT BBB-sf New Rating Class E XS3207996789 LT BB-sf New Rating Class F XS3207996946 LT B-sf New Rating Subordinated Notes XS3207997167 LT NRsf New Rating Transaction Summary Margay 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 have been used to purchase a portfolio with a target par of EUR400 million. The portfolio is actively managed by M&G Investment Management Limited. The collateralised loan obligation (CLO) has a reinvestment period of 5.1 years and an eight-year weighted average life (WAL) test. KEY RATING DRIVERS Average Portfolio Credit Quality (Neutral): Fitch places the average credit quality of obligors at 'B'. The Fitch weighted average rating factor of the identified portfolio is 23.6. 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 of the identified portfolio is 59.6%. Diversified Portfolio (Positive): The transaction 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 portfolio will not be exposed to excessive concentration. Portfolio Management (Neutral): The deal includes four Fitch matrices: two effective at closing and corresponding to a top 10 obligor concentration limit at 20%, fixed-rate asset limits at 5% and 10% and an eight-year WAL test. The other two matrices can be selected by the manager at any time from year one, after closing as long as the aggregate collateral balance (including defaulted obligations at their Fitch-calculated collateral value) is at least at the target par. They have the same limits as the closing matrices, but with a seven-year WAL test. The transaction has a 5.1-year reinvestment period and includes reinvestment criteria similar to those of other European deals. 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 (Neutral): The deal can step up the WAL covenant by 12 months one year after closing, subject to all collateral quality tests being met based on the closing matrix sets and that the aggregate collateral balance (defaults at the Fitch-calculated collateral value) is at least at the target par. Cash Flow Modelling (Positive): The WAL used for the transaction's Fitch-stressed portfolio analysis was 12 months less than the WAL test covenant to account for the strict reinvestment conditions envisaged after the reinvestment period. These include passing the coverage tests, the Fitch weighted average rating factor and Fitch 'CCC' bucket limitation, together with a gradually decreasing WAL covenant. In Fitch's opinion, these conditions 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 result in downgrades of one notch each for the class B to E notes, and to below 'B-sf' for the class F notes. Downgrades, which are based on the identified portfolio, may occur if the loss expectation is larger than assumed, due to unexpectedly high levels of default and portfolio deterioration. The class B, D and E notes each have a rating cushion of two notches and the class C and F have a cushion of one notch, due to the better metrics and shorter life of the identified portfolio than the Fitch-stressed portfolio. The class A notes have no rating cushion as they are at their maximum achievable rating. Should the cushion between the identified and Fitch-stressed portfolios 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 B and C notes, up to three notches each for the class A and D notes, and to below 'B-sf' for the class E and F notes. Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade A 25% reduction of the mean RDR and a 25% increase in the RRR across all ratings of the Fitch-stressed portfolio would lead to upgrades of up to three notches each for the rated notes, except for the 'AAAsf' rated notes. Upgrades during the reinvestment period, 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. Upgrades after the end of the reinvestment period 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 The majority of the underlying assets or risk-presenting entities have ratings or credit opinions from Fitch and other Nationally Recognised Statistical Rating Organisations and European Securities and Markets Authority- registered rating agencies. Fitch has relied on the practices of the relevant groups within Fitch and 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 its analysis according to its applicable rating methodologies indicates that it is adequately reliable. ESG Considerations Fitch does not provide ESG relevance scores for Margay 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. ========= I T A L Y ========= ENGINEERING INGEGNERIA: Fitch Affirms 'B' IDR, Outlook Stable ------------------------------------------------------------- Fitch Ratings has affirmed Engineering Ingegneria Informatica S.p.A.'s (EII) Long-Term Issuer Default Rating (IDR) at 'B' with a Stable Outlook. Fitch has also affirmed EII's senior secured instrument rating at 'B', with a Recovery Rating of 'RR4'. The affirmation reflects EII's high leverage, weak coverage ratios and limited free cash flow (FCF) for 2025-2027, which is balanced by its strong market position in Italy and supportive industry trends. This rating review was prompted by the discovery of the participation of an ineligible voting member in the last rating committee on 15 January 2025, who should have rotated off the entity. Fitch reconvened a rating committee as soon as the analysis could be updated following this discovery, to determine if the rating action could have been influenced by a conflict of interest. The new committee determined that there was no need to revise the rating. Key Rating Drivers High Leverage: Fitch estimates EII's Fitch-defined EBITDA leverage will reduce to 5.8x at end-2025 from 6.0x in 2024, in line with the sensitivities for its 'B' rating. Fitch expects EBITDA leverage to decline further by 0.2x-0.4x a year in 2026-2028 as growing EBITDA is slightly offset by higher factoring utilisation. This will allow EII to build further rating headroom. Low Interest Coverage: EBITDA interest coverage will remain at the lower end of the thresholds for the 'B' rating for the next two years. Fitch forecasts EBITDA interest coverage of 2.3x in 2025 and 2026 before increasing to 2.4x in 2027. This pressure is due to the full impact of higher-coupon debt raised in the last three years, as well as the full-year effect of the higher-cost refinancing. This is slightly offset by an EURIBOR rate expected by Fitch at around 2% over the next few years. Fitch expects the headroom under this metric to improve in 2028, when it is expected to benefit from gradual increases in EBITDA. FCF Generation Improving: FCF margins were neutral to negative in 2023 and 2024. Fitch forecasts FCF will remain low at 1.4% and 2.2% in 2025 and 2026, before recovering to above 3% in 2027. Fitch expects EII to reduce capex to below EUR60 million in 2026, from its peak of EUR91 million in 2023, and then make further reductions to around EUR45 million-EUR50 million in 2027-2029. Non-recurring costs will also decrease to around EUR20 million in 2025, supporting FCF stabilisation. Moderate Organic Growth: Fitch expects EII's organic revenue growth to average just under 3% for 2025-2028. It trades mainly in Italy, where Fitch expects slow GDP growth of 0.6% in 2025 and 0.8% in 2026. However, trends and incentives for digitalisation under the Italian National Recovery and Resilience Plan should facilitate new contract wins. Fitch expects the finance and energy and utilities segments to be key contributors to growth in 2026, while health care normalises following a large one-off spike in 2025, due to a telemedicine contract. Some Profitability Increase: Fitch estimates Fitch-defined EBITDA margin to have increased to 14.6% in 2025 from 14.4% in 2024 and 13.5% in 2023, following cost restructuring and the realisation of synergies. Fitch expects margins will remain at around the same level until 2028, with growth of 0.1%-0.2% each year. EII's revenues are driven by mission-critical IT services and consultancy in digital transformation, where personnel and outsourced technical support make up most of the cost base. Margins are lower than at pure software providers. Proprietary Software and Digitech: EII has invested heavily in its proprietary software technology and digitech service offerings and expects to see revenues grow in these two services lines. Capex in 2023 and 2024 was aimed at increasing EII's competitive advantage to capture more profitable growth from these two segments. Revenues from proprietary technologies have higher profitability, and growth in this segment should allow EBITDA margin increases. Labour Costs Constrain Margin Growth: Fitch expects contract profitability to only marginally increase, as specialised labour cost inflation is compensated by relocations of part of the workforce to lower labour-cost areas in the country. However, overall profitability could see higher-than-expected increases, as investments in proprietary technologies increase the segment's share of total revenue. Strong Position in Italy: EII ranks among the top three companies in Italy in implementation and management of software applications, with a market share of around 10%. Its scale and reputation have helped it grow faster than GDP over the last 20 years, driven by investments and acquisitions. Fitch believes that EII will be able to capitalise on expected growth in digital investments in Italy, which still lags the rest of western Europe. However, the domestic market remains competitive. Peer Analysis EII's Fitch-rated leveraged buyout (LBO) peers include IT service companies such as Cedacri S.p.A. (B/Stable) and AlmavivA S.p.A. (BB-/Negative). It is also comparable with employee resource planning software-as-a-service providers, TeamSystem S.p.A. (B/Stable) and Unit4 Group Holding B.V. (B/Stable). EII's revenue share of internally developed software solutions of 13% is lower than that of TeamSystem and Unit4, whose revenues are almost exclusively from internally developed software. This is reflected in EII's lower revenue visibility and weaker margins. However, it is balanced by EII's strong diversification and leading market positions in the Italian IT software and consulting services markets. EII has similar leverage to its LBO peers but generates lower EBITDA and FCF margins. This is related to the lower profitability from system-integration and digitech services and the limited scalability of industry-specific proprietary software solutions and consulting services compared with other software peers, which have either a stronger subscription model or pure software content. Fitch’s Key Rating-Case Assumptions - Revenue growth of 1.6% in 2025 and 2.8% in 2026, followed by 3.4% in 2027 and 3.1% in 2028 - Fitch-defined EBITDA margin to grow to 14.6% in 2025 and to rise slowly to 14.9% by 2027 - Working-capital outflows offset by factoring utilisation to 2028 - Capex at around 2.5%-4.0% of revenue in 2025-2027 - Bolt-on acquisitions of EUR10 million a year from 2025 onwards Recovery Analysis The recovery analysis assumes that EII would be considered a going-concern (GC) in bankruptcy, and that it would be reorganised rather than liquidated, given the inherent value behind its contract portfolio, its incumbent software licenses, and strong client relationships. Fitch has assumed a 10% administrative claim. Fitch assesses GC EBITDA at about EUR175 million, which after undertaking corrective measures, would generate neutral FCF. Financial distress, leading to a restructuring, may be driven by severe recessionary effects, shrinking the client base as customers cut back on non-critical consulting and outsourcing. Additionally, should the company fall technologically behind its competitors, it may lose its clients' business-critical projects to competition. A multiple of 5.5x is applied to the GC EBITDA to calculate a post-reorganisation enterprise valuation. This is in line with multiples used for other software-focused issuers rated in the 'B' category. Its recovery analysis includes EII's EUR485 million senior secured notes ranking equally with the EUR650 million notes. Fitch assumes a fully drawn super senior revolving credit facility (RCF) of EUR205 million, and around EUR100 million of bilateral facilities and other financial liabilities. Fitch assumes EUR226 million of receivables factoring is not available in a restructuring. The debt waterfall analysis results in a 'RR4' recovery rating for the senior secured debt, resulting in a 'B' instrument rating. RATING SENSITIVITIES Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade - EBITDA leverage consistently above 6.5x - EBITDA/interest paid below 2.0x - Worsening FCF margins below 1% through the cycle, with increases in cash outflows from working capital and higher capex requirements - Deterioration in the quality of revenue towards a less recurring, contract-led revenue model Factors That Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade - EBITDA leverage below 5.0x on a sustained basis - Cash from operations less capex/total debt at mid-to-high single-digit percentages, due to higher contract profitability and improved working-capital management - EBITDA/interest paid sustained above 3.0x - Increase of subscription-based recurring sales in the revenue mix Liquidity and Debt Structure Liquidity is underpinned by cash on balance sheet and by an estimated undrawn amount available under the RCF of around EUR115 million at end-September 2025. Working capital can be volatile, as significant investments in client receivables are key to securing contracts. In addition, EII's quarterly working-capital volatility may lead to drawdowns on the RCF or further increases in factoring utilisation. This will affect Fitch-adjusted debt metrics and lead to increases in leverage, if not accompanied by an increase in EBITDA. Fitch has assumed EUR150 million of restricted cash for end-2024, of which EUR80 million is guaranteed to R&D partners and the remaining EUR70 million is an estimate of the company's peak-to-trough cash on its balance sheet each quarter. Fitch treats the company's payment in kind instrument as equity, which is contingent on its maturity being beyond of all other debt instruments. Upcoming debt maturities include EUR485 million senior secured fixed rate notes due in May 2028 and EUR650 million senior secured floating and fixed rate notes due in February 2030. Issuer Profile EII is a leading Italian specialist in IT services, software development, and the provision of digital platforms MACROECONOMIC ASSUMPTIONS AND SECTOR FORECASTS Fitch's latest quarterly Global Corporates Sector Forecasts Monitor 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 EII has an ESG Relevance Score of '4' for Governance Structure, due to the legal and commercial risks derived from being a contractor for the public sector in Italy, which 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 Prior ----------- ------ -------- ----- Engineering Ingegneria Informatica S.p.A. LT IDR B Affirmed B senior secured LT B Affirmed RR4 B ===================== N E T H E R L A N D S ===================== EBN FINANCE: Fitch Affirms 'CCC' Sr. Unsec. Debt Rating ------------------------------------------------------- Fitch Ratings has affirmed Ecobank Nigeria Limited's (ENG) Long-Term Issuer Default Rating (IDR) at 'CCC' and the senior unsecured debt rating on EBN Finance Company B.V.'s outstanding USD150 million Eurobond at 'CCC'. The Viability Rating (VR) has been affirmed at 'f', the Shareholder Support Rating (SSR) at 'no support' and the National Long-Term Rating at 'B+(nga)' with a Stable Outlook. Key Rating Drivers The Long-Term IDR reflects Fitch's view that default remains a real possibility given the risk of deposit withdrawals in view of the bank's modest foreign-currency liquidity and high regulatory intervention risk linked to its material capital shortfall. However, Fitch understands that the bank's deposits have been broadly stable and believes the bank has sufficient liquidity to continue servicing its obligations, including the remaining USD150 million Eurobond, and that default is not probable. The VR of 'f' reflects its view that the bank has a material capital shortfall. The VR is below the implied VR of 'ccc-' due to a negative adjustment for capitalisation and leverage. Eurobond Tender Offer: ENG launched a tender offer on 28 November to redeem its USD150 million senior unsecured Eurobond maturing in February 2026 at par together with accrued interest. The tender offer is expected to conclude by end-2025 and Fitch believes the bank has sufficient foreign-currency liquidity to redeem the outstanding USD150 million. The tender offer follows an earlier tender offer to redeem USD150 million of the original USD300 million Eurobond, which concluded successfully in July 2025. Tight Foreign-Currency Liquidity: Foreign-currency liquidity is sufficient to service ENG's obligations, but it remains very tight by domestic standards, particularly considering that the bank's foreign-currency customer deposits are highly concentrated and 46% are price-sensitive term deposits. Following the tender offer, Fitch estimates that foreign-currency liquid assets will cover a modest percentage of foreign-currency deposits. However, the bank retains access to some foreign-currency liquidity support from its parent, Ecobank Transnational Incorporated (ETI; B-/Stable), and, if successful, elements of the bank's capital plan would boost foreign-currency liquidity. Prolonged CAR Breach: ENG has been in breach of its total capital adequacy ratio (CAR) requirement of 10% since the devaluation of the naira in 2M24, despite extensive regulatory forbearance relating to the classification and provisioning of problem loans and single-obligor limit breaches. The breach is particularly large when excluding the benefits of regulatory forbearance, which was withdrawn for the broader banking system at end-1H25. Accordingly, Fitch considers the bank to have a material capital shortfall. High Regulatory Intervention Risk: Fitch understands that a transitory period granted by the Central Bank of Nigeria to ensure the banking system's orderly exit from forbearance expires on 31 March 2026. ENG intends to exit forbearance and restore CAR compliance by this date, primarily through AT1 issuance and large loan sales that it expects to conclude in 1Q26. Failure to do so would increase the risk of regulatory intervention and restrictions on ENG servicing its obligations, but this is not Fitch's expectation. Rating Sensitivities Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade A downgrade of ENG's Long-Term IDR would result from an increase in default risk. This would most likely result from deposit withdrawals resulting in a weakening of the stock of liquid assets, or an increased risk of restrictions on the bank servicing its obligations resulting from regulatory intervention. A downgrade of the National Ratings would result from a weakening in creditworthiness relative to other Nigerian issuers. Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade An upgrade of ENG's Long-Term IDR would require an upgrade of the VR or SSR to 'ccc+' or higher. An upgrade of ENG's VR would require the bank to restore CAR compliance after exiting forbearance and significantly improve its foreign-currency liquidity. An upgrade of the National Ratings would result from a strengthening in creditworthiness relative to other Nigerian issuers. OTHER DEBT AND ISSUER RATINGS: KEY RATING DRIVERS Senior unsecured debt issued through EBN Finance Company B.V. is rated at the same level as ENG's Long-Term IDR, reflecting Fitch's view that the likelihood of default on these obligations is the same as that of the bank. The Recovery Rating of these notes is 'RR4', indicating average recovery prospects in the event of default. The delay in ETI providing a substantial capital injection to ENG since the CAR breach indicates a weak record of timely support and the SSR of 'no support' reflects no reasonable assumption of support being forthcoming to avoid defaulting on senior obligations. OTHER DEBT AND ISSUER RATINGS: RATING SENSITIVITIES ENG's senior unsecured debt ratings are sensitive to changes in its Long-Term IDRs. An upgrade of ENG's SSR would require a stronger record of ETI providing support. 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 ----------- ------ -------- ----- EBN Finance Company B.V. senior unsecured LT CCC Affirmed RR4 CCC Ecobank Nigeria Limited LT IDR CCC Affirmed CCC ST IDR C Affirmed C Natl LT B+(nga) Affirmed B+(nga) Natl ST B(nga) Affirmed B(nga) Viability f Affirmed f Shareholder Support ns Affirmed ns HILL FL 2023-1: Fitch Lowers Rating on Class D Notes to 'BB+sf' --------------------------------------------------------------- Fitch Ratings has downgraded the class B, C and D notes of Hill FL 2023-1 B.V., Hill FL 2024-1 B.V., and Hill FL 2024-2 B.V. The class A notes have been affirmed. Entity/Debt Rating Recovery Prior ----------- ------ -------- ----- Hill FL 2023-1 B.V. Class A XS2604660899 LT AAAsf Affirmed AAAsf Class B XS2604661277 LT AA-sf Downgrade AA+sf Class C XS2604661434 LT Asf Downgrade A+sf Class D XS2604661608 LT BB+sf Downgrade BBB+sf Hill FL 2024-1 B.V. Class A XS2744967386 LT AAAsf Affirmed AAAsf Class B XS2744967899 LT AA-sf Downgrade AA+sf Class C XS2744968434 LT Asf Downgrade A+sf Class D XS2744968517 LT BBB-sf Downgrade Asf Hill FL 2024-2 B.V. Class A XS2905556044 LT AAAsf Affirmed AAAsf Class B XS2905556390 LT AA-sf Downgrade AA+sf Class C XS2905556473 LT Asf Downgrade A+sf Class D XS2905556556 LT BBB-sf Downgrade BBB+sf Transaction Summary The transactions securitise pools of financial auto lease receivables including balloon amounts originated by Hiltermann Lease Group Holding B.V. Lessees are Dutch small businesses or sole proprietors. The transactions are amortising pro rata and will switch irreversibly to sequential once certain triggers are breached. KEY RATING DRIVERS Nine Tranches Downgraded: Fitch has downgraded all but the most senior notes across the three transactions. This reflects the weaker performance in the asset assumptions and considerations related to the pro rata amortisation dynamics. For the junior notes, the downgrades have also been driven by the high reliance on excess spread in the tail of the transactions in case of back-loaded defaults. Asset Assumption Updates: Fitch has increased the default base case for Hill 2024-1 and Hill 2024-2 to 7.5% from 6.5% and 6.3%, respectively, to address that defaults are above its expectations (cumulative defaults at 5.8% and 3.4%). Cumulative defaults are 6.4% to date and performance has been in line with its expectations, so the default base case for Hill 2023-1 is unchanged at 6.3% of the outstanding balance. The 'AAA' default multiple for Hill 2023-1 is unchanged at 4.25x but Fitch has lowered it to 4.0x from 4.25x for Hill 2024-1 and Hill 2024-2, reflecting the end of the revolving period for the latter, the high absolute level of the base case, and similar performance across the transactions. The recovery base case and 'AAA' haircut are unchanged at 80% and 45%, respectively, for all transactions, consistent with the general recovery performance. Full Repurchases of Defaulted Contracts: Since the end of 2024, Hiltermann has been repurchasing all newly defaulted contracts at their outstanding balance at the point of default, ensuring swift recoveries that match the defaulted amounts. The SPV settles the difference between the repurchase amount and the eventual vehicle sale price through a subordinated item in the waterfall, and any losses at this point count towards the relevant trigger. This approach can benefit the notes if Hiltermann continues to repurchase defaults, as this prevents losses, however, if repurchases are discontinued, the positive impact may be offset by an extended pro-rata period with no credit enhancement build-up. Fitch does not give credit to Hiltermann's repurchases as it is unrated and this is an option instead of a contractual obligation. However, Fitch factors the repercussions of this approach into the ratings. Pro Rata Dynamics: The transactions are amortising pro-rata and will irreversibly switch to sequential if the performing pool balance falls below the rated notes or cumulative losses exceed certain levels, among other triggers. Continued repurchases of defaults can prolong the pro rata period by delaying the sequential triggers being hit. Fitch has tested the impact of this feature on prolonged pro-rata periods by assuming different points for stopping repurchases. Fitch believes that an extended pro-rata period puts pressure on the ratings if Hiltermann suddenly stopped repurchasing. This has been considered in the ratings. Excess Spread Dynamics: Portfolio interest in excess of the issuer's expenses and release amounts from the reserve may be used to cure defaults. For at least 90% of the outstanding balance of the transactions, the issuer benefits from all future instalments if the lessee prepays. This reduces the negative impact on excess spread in case of high prepayments. The availability of excess spread in the structures is the main driver of the junior notes' ratings, which particularly rely on it. Counterparty Risks Addressed: Fitch considers servicing continuity risk reduced based on the availability of replacement servicers in the Dutch leasing market, considering the low complexity of financial leases, clearly documented replacement provisions and adequately sized reserves that provide about three months or more of interest coverage of class A to D notes. Commingling risk is addressed by the use of an insolvency-remote collection foundation and replacement provisions on the collection account bank provider, in line with Fitch's criteria. RATING SENSITIVITIES Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade Unanticipated increases in default rates or decreases in recovery rates producing larger losses than its current assumptions could result in negative rating actions on the notes. Below are the rating sensitivities for classes A/B/C/D of Hill 2023-1, Hill 2024-1 and Hill 2024-2, respectively: Increase default rates by 10%: 'AA+sf'/'A+sf'/'A-sf'/'BB+sf'; 'AA+sf'/'A+sf'/'A-sf'/'BBB-sf';'AA+sf'/'AA-sf'/'Asf'/'BBB-sf' Increase default rates by 25%: 'AAsf'/'Asf'/'BBB+sf'/'BB+sf'; 'AAsf'/'Asf'/'BBB+sf'/'BBB-sf'; 'AAsf'/'A+sf'/'A-sf'/'BBB-sf' Increase default rates by 50%: 'AA-sf'/'A-sf'/'BBBsf'/'BBsf''; 'A+sf'/'A-sf'/'BBBsf'/'BBB-sf'; 'AA-sf'/'Asf'/'BBB+sf'/'BBB-sf' Reduce recovery rates by 10%: 'AA+sf'/'A+sf'/'BBB+sf'/'BBsf''; 'AA+sf'/'A+sf'/'A-sf'/'BBB-sf'; 'AA+sf'/'AAsf'/'A-sf'/'BBB-sf' Reduce recovery rates by 25%: 'AA+sf'/'Asf'/'BBBsf'/'B-sf''; 'AAsf'/'Asf'/'BBBsf'/'BB+sf'; 'AA+sf'/'A+sf'/'BBBsf'/'BBB-sf' Reduce recovery rates by 50%: 'AA-sf'/'BBB+sf'/'BB+sf'/'NRsf''; 'A+sf'/'BBB+sf'/'BBsf'/'CCCsf'; 'AA-sf'/'BBB+sf'/'BB+sf'/'BBsf' Increase default rates by 10% and reduce recovery rates by 10%: 'AA+sf'/'A+sf'/'BBB+sf'/'BBsf''; 'AAsf'/'A+sf'/'BBB+sf'/'BBB-sf'; 'AA+sf'/'AA-sf'/'BBB+sf'/'BBB-sf' Increase default rates by 25% and reduce recovery rates by 25%: 'AA-sf'/'BBB+sf'/'BBB-sf'/'CCCsf''; 'A+sf'/'BBB+sf'/'BB+sf'/'BB-sf'; 'AA-sf'/'Asf'/'BBB-sf'/'BB+sf' Increase default rates by 50% and reduce recovery rates by 50%: 'BBB+sf'/'BB+sf'/'B-sf'/'NRsf''; 'BBB+sf'/'BB+sf'/'CCCsf'/'NRsf'; 'BBB+sf'/'BB+sf'/'Bsf'/'NRsf' Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade Lower defaults and higher recovery levels, improving economic conditions and a more relaxed monetary policy, could lead to positive rating action. For example, a simultaneous decrease of defaults and increase of recoveries by 25% would have the following impact on Hill 2023-1, Hill 2024-1 and Hill 2024-2 class A/B/C/D notes, respectively: 'AAAsf'/'AAAsf'/'AAsf'/'Asf'; 'AAAsf'/'AAAsf'/'AA+sf'/'AA-sf'; 'AAAsf'/'AAAsf'/'AA+sf'/'AAsf'. 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 Hill FL 2023-1 B.V. 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. Prior to the transaction closing, 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. Prior to the transaction closing, Fitch conducted a review of a small targeted sample of the originator's origination files and found the information contained in the reviewed files to be adequately consistent with the originator's policies and practices and the other information provided to the agency about the asset portfolio. Overall, and together with any assumptions referred to above, Fitch's assessment of the information relied upon for the agency's rating analysis according to its applicable rating methodologies indicates that it is adequately reliable. Hill FL 2024-1 B.V., Hill FL 2024-2 B.V. 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. Prior to the transaction closing, 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. UNITED GROUP: S&P Rates New EUR400MM Sr. Secured Notes 'B' ---------------------------------------------------------- S&P Global Ratings assigned its 'B' issue rating to the proposed EUR400 million senior secured fixed-rate notes due January 2032 to be issued by United Group B.V. (B/Stable/--). The rating on the proposed notes is in line with the rating on the existing senior secured notes. The group will use the funds from the new issuance to redeem the remaining outstanding amount under its senior secured notes due 2027, repay drawings on its revolving credit facility (RCF) and certain local facilities, and pay transaction fees and expenses. S&P will discontinue the issue rating on the fixed-rate notes due in 2027 because they will be fully repaid. The proposed transaction will underpin United Group's adequate liquidity, addressing its closest maturities. S&P said, "At the same time, it will incrementally increase the company's annual interest expense, but we do not expect this to materially affect cash flow generation. Nevertheless, we continue to forecast negative free operating cash flow (FOCF) in 2025 and about break-even FOCF in 2026. This is primarily because we anticipate high working capital outflows and elevated capital spending to fund the rollout of the fixed-line network infrastructure in Greece, as well as enhancements to the mobile network." S&P said, "We now anticipate the group's S&P Global Ratings-adjusted EBITDA margin will improve to 38.5%-39.0% in 2025-2026 from 37% in 2024, thanks to declining integration and restructuring costs, cross-selling actions, cost optimization, and increasing convergence. This is slightly better than our previous forecast and in line with United Group's performance over the first nine months of 2025. Under our current base case, we therefore anticipate the company will report stronger S&P Global Ratings-adjusted debt to EBITDA of about 6.2x in 2025, and 6.1x in 2026, compared with our previous forecast of 6.5x and 6.2x, respectively, which remain in line with our current rating parameters. "Our 'B' long-term issuer credit rating and stable outlook on United Group B.V., the 'B' rating on the existing senior secured notes, and the 'B-' rating on the payment-in-kind (PIK) notes are unaffected by this rating action." Issue Ratings - Subordination Risk Analysis Capital structure The group's capital structure at closing mainly consists of EUR4 billion of senior secured notes issued by United Group B.V., EUR300 million of PIK notes issued by holding company Summer Bidco B.V., and about EUR250 million bilateral facilities after the transaction closes. The company also has access to a EUR410 million super senior secured RCF that we expect will be repaid at closing. Analytical conclusions S&P said, "Our 'B' issue ratings on the existing and proposed senior secured notes are at the same level as the issuer credit rating. This is because the notes are secured and only drawings from the EUR410 million super senior secured RCF and the about EUR250 million of bilateral facilities at the operating company level have priority over the notes upon enforcement of collateral. "This is significantly lower than our threshold of priority debt accounting for at least 50% of total debt for notching from the issuer credit rating to derive the issue rating. "Our 'B-' rating on the PIK notes is one notch below the issuer credit rating on United Group. This is because the share of priority liabilities ranking ahead of these notes is about 90% of total debt. Furthermore, the notes do not share the security package or guarantees offered to holders of the group's issued debt and there is no recourse to that restricted group. Therefore, we view these notes as structurally subordinated." =========== R U S S I A =========== SQB INSURANCE: Fitch Affirms 'BB' Long-Term IDR, Outlook Stable --------------------------------------------------------------- Fitch Ratings has affirmed Joint Stock Company Insurance Company SQB Insurance's Insurer Financial Strength (IFS) Rating and Long-Term Issuer Default Rating (IDR) at 'BB'. The Outlooks are Stable. The ratings for the Uzbekistan-based company benefit from the ownership of Uzbek Industrial and Construction Bank Joint-Stock Commercial Bank (UICB, Long-Term IDR: BB/Stable). SQB Insurance's standalone credit quality of 'b' reflects the company's small operating scale, weak capitalisation, good financial performance and investment risk, which remain commensurate with the ratings. Key Rating Drivers Support Drives Ratings: SQB Insurance's ratings are aligned with UICB's Long-Term IDR, reflecting the importance of SQB Insurance to the parent and the strong integration of its operations within the group and management oversight. This supports its expectation that UICB will continue to develop the insurance business and provide support to SQB Insurance, leading a three-notch uplift to SQB Insurance's standalone credit quality. Limited Operating Scale; Group Reliance: SQB Insurance is small scale with an about 2% market share in 2024 and 9M25 and volatile growth record. The company benefits from access to the parent bank's client base but overall has moderate competitive positioning and diversification. Its assessment also reflects heightened business risk from the company's focus on financial risk insurance, which accounted for 43% of net premiums in 9M25 (2024: 53%). Inward reinsurance business is also expanding and represented 19% of premiums in 9M25 (2024: 14%). Group-sourced business has declined to 37% of premiums in 2024 and 24% in 9M25, from 58% in 2023 and 61% in 2022, as the company develops other distribution channels. Nevertheless, its reliance on the group is large. Weak Capital Position: SQB Insurance's capital position is weak. The Prism Global model score was 'Weak' at end-2024, in line with end-2023, with high asset risk contributing most to the insurer's target capital. The company's non-risk-based solvency framework coverage ratio improved to 234% at end-3Q25, from 199% at end-2024 and 159% at end-2023. The company meets the new UZS80 billion regulatory minimum requirement for reinsurance companies, effective from October 2025, based on its UZS105 billion of regulatory capital at end-3Q25. However, the gradual tightening of regulatory capital requirements through October 2029 will likely put pressure on the company's solvency margin. Good Investment-Driven Performance: SQB Insurance's return on equity (ROE) under IFRS reporting was 26% in 2024 and has averaged 24% over the last four years. Statutory reporting indicates strong financial performance in 2025, with a 9M25 net profit of UZS17.3 billion equating to an annualised ROE of 23%. The company's good performance is driven by strong investment results from deposits, in the form of mainly local-currency denominated interest income. This income has offset historically poor underwriting results, reflected in an IFRS combined ratio of 130% in 2024 and a four-year average of 119%. Conservative Investment Strategy: The company's investments are predominantly short- and long-term deposits, representing 99% of the investment portfolio at end-2024. These deposits are placed with several state-owned and large private banks, mainly rated in the 'BB' category. Stronger Reinsurance Panel: The company increased its reliance on reinsurance, with the net-to-gross premium ratio of 74% in 9M25 and 64% in 2024 (2023: 87%). Usage mainly varies with property risk cover needs, which are ceded on facultative basis. At end-3Q25, 82% of ceded liabilities were placed with 'A'-rated UK and Singapore reinsurers, compared with 61% at end-2024 and only 8% at end-2023. Previously, the company ceded risks primarily to local reinsurers or companies in central Asia. RATING SENSITIVITIES Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade - A downgrade of UICB's Long-Term IDR - A reduction in UICB's propensity to support SQB Insurance Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade - An upgrade of UICB's Long-Term IDR Public Ratings with Credit Linkage to other ratings The ratings reflect credit linkage to UICB. 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 Prior ----------- ------ ----- Joint Stock Company Insurance Company SQB Insurance LT IDR BB Affirmed BB LT IFS BB Affirmed BB ========= S P A I N ========= FTA UCI 16: Fitch Hikes Rating on Class C Notes to 'B-sf' --------------------------------------------------------- Fitch Ratings has upgraded six tranches of four FTA UCI Spanish RMBS transactions. Entity/Debt Rating Prior ----------- ------ ----- FTA, UCI 17 Class A2 ES0337985016 LT AAAsf Upgrade AA+sf Class B ES0337985024 LT BB-sf Upgrade B-sf Class C ES0337985032 LT CCCsf Affirmed CCCsf Class D ES0337985040 LT CCsf Affirmed CCsf FTA, UCI 14 Class A ES0338341003 LT AAAsf Affirmed AAAsf Class B ES0338341011 LT AAsf Upgrade A+sf Class C ES0338341029 LT CCCsf Affirmed CCCsf FTA, UCI 15 Series A ES0380957003 LT AAAsf Affirmed AAAsf Series B ES0380957011 LT AA+sf Upgrade Asf Series C ES0380957029 LT CCCsf Affirmed CCCsf Series D ES0380957037 LT CCCsf Affirmed CCCsf FTA, UCI 16 A2 ES0338186010 LT AAAsf Affirmed AAAsf B ES0338186028 LT Asf Upgrade BB+sf C ES0338186036 LT B-sf Upgrade CCCsf D ES0338186044 LT CCsf Affirmed CCsf E ES0338186051 LT CCsf Affirmed CCsf Transaction Summary The transactions comprise Spanish residential mortgages originated and serviced by Union de Creditos Inmobiliarios S.A. E.F.C. (BBB+/Stable/F2) a specialist lender fully owned by BNP Paribas SA (A+/Stable/F1) and Banco Santander, S.A. (A/Stable/F1). KEY RATING DRIVERS CE Build Up: The rating actions reflect Fitch's view that credit enhancement (CE) protection for the notes is sufficient to fully compensate the credit and cash flow stresses associated with the corresponding rating scenarios, substantiating the upgrade of all transactions' class B notes, UCI 16's class C notes and UCI 17's class A notes. Fitch expects structural CE to continue increasing across all transactions, driven by the ongoing sequential amortisation of the notes and the non-amortising reserve funds. The transactions are prevented from paying principal on a pro-rata basis due to three months plus arrears exceeding the 2% documented threshold. Fitch believes that a sufficient reduction in arrears to enable pro-rata amortisation is very unlikely and has therefore assumed continued sequential amortisation for the life of the notes in its analysis. Moreover, a mandatory sequential paydown will be triggered once the outstanding portfolio balance falls below 10% of the initial amount (currently between approximately 11% and 16% as of the last payment date), further supporting its expectation of CE build-up. No Credit for Unsecured Loans: The transactions contain a small proportion of unsecured loans, representing between 4% and 7% of the current portfolio balance including defaults, which were granted alongside the mortgage at loan origination. Fitch has not given credit in its analysis to the proceeds from unsecured loans due to the inherent risk of complementary loans and insufficient performance data, resulting in negative CE ratios for the junior tranches in the rating analysis. Volatile Asset Performance Outlook: The transactions are exposed to asset performance volatility due to high arrears observed in recent months. Loans in arrears over 90 days were above 4% of the current portfolio balance at September 2025. This is lower than a year ago when they were between 7.0% and 8.5%, but materially above the average for Fitch-rated Spanish RMBS deals of less than 1.0%, mainly due to the portfolios' exposure to vulnerable borrowers. When calibrating the portfolio foreclosure frequency (FF) rates, Fitch has maintained a 1.5x transaction adjustment for UCI 14 and 15 and 2.0x for UCI 17, and has reduced that for UCI 16 to 2.0x (from 2.75x before), reflecting the observed portfolio performance, which materially differs from the criteria-derived transaction-specific weighted average FF for these portfolios. RATING SENSITIVITIES Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade - For all transactions' class A notes, a multi notch downgrade of Spain's Long-Term Issuer Default Rating (IDR) that could decrease the maximum achievable rating for Spanish structured finance transactions. - Long-term asset performance deterioration such as increased delinquencies or larger defaults, which could be driven by adverse changes to macroeconomic conditions, interest rates or borrower behaviour. For instance, a simultaneous increase of defaults (+15%) and a decrease of the recoveries (-15%) could trigger downgrades of up to three notches. Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade - All transactions' class A notes are at the highest level on Fitch's scale and cannot be upgraded. - For the junior notes, CE ratios increase as the transactions deleverage, able to fully compensate the credit losses and cash flow stresses commensurate with higher rating scenarios, all else being equal. - Stable to improved asset performance driven by stable delinquencies and defaults could potentially lead to upgrades. For instance, simultaneous decrease of defaults (-15%) and an increase of the recoveries (+15%) could trigger upgrades of up to five notches. USE OF THIRD PARTY DUE DILIGENCE PURSUANT TO SEC RULE 17G -10 ABS Due Diligence-15E was not provided to, or reviewed by, Fitch in relation to this rating action. DATA ADEQUACY FTA, UCI 14, FTA, UCI 15, FTA, UCI 16, FTA, UCI 17 Fitch has checked the consistency and plausibility of the information it has received about the performance of the asset pools and the transactions. 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. Fitch did not undertake a review of the information provided about the underlying asset pools ahead of the transaction's initial closing. The subsequent performance of the transactions over the years is consistent with the agency's expectations given the operating environment and Fitch is therefore satisfied that the asset pool information relied upon for its initial rating analysis was adequately reliable. 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 transactions have an ESG Relevance Score of '4' for Transaction Parties & Operational Risk due to the large share of restructured loans that currently form the portfolios, which 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. =========== S W E D E N =========== ASMODEE GROUP: S&P Rates Proposed EUR320MM Fixed-Rate Notes 'BB-' ----------------------------------------------------------------- S&P Global Ratings assigned its 'BB-' issue rating and '3' recovery rating to tabletop games retailer Asmodee Group AB's proposed EUR320 million six-year senior secured fixed-rate notes. S&P said, "In our view, this transaction is leverage neutral and indicates a proactive management of debt maturities. We understand Asmodee will use the proceeds to refinance its existing EUR320 million senior secured floating-rate notes due December 2029. The proposed notes will rank pari passu with the existing EUR320 million 5.75% senior secured fixed-rate notes due December 2029, while the EUR150 million super-senior RCF due June 2029 will maintain its priority ranking on enforcement. "Our 'BB-' long-term issuer credit rating and stable outlook on Asmodee are unchanged, as are our 'BB-' issue rating and '3' recovery rating on its existing notes." Issue Ratings--Recovery Analysis Key analytical factors -- S&P's rating on Asmodee's EUR640 million senior secured notes is unchanged at 'BB-', in line with the issuer credit rating. The recovery rating is '3', reflecting its expectation of meaningful recovery (50%-70%; rounded estimate: 65%) in the event of default. -- The recovery prospects are supported by the group's entrenched competitive position in the niche tabletop industry and leading positions in some of its key markets. However, the presence of a prior-ranking revolving credit facility (RCF) and S&P's perception of a weak security package--comprising share pledges over the shares of Asmodee Group AB and its subsidiaries--is a constraining factor. There are no direct liens on intellectual properties (IPs). -- S&P values the group as a going concern, given its varied portfolio of owned IPs and established relationship with well-known third-party brands and a diverse distribution network. -- In S&P's hypothetical default scenario, it envisages a deterioration of the operating performance due to a structural decline in demand for board games, loss of key licenses, and the unsuccessful integration of material acquisitions. Simulated default assumptions -- Year of default: 2029 -- Jurisdiction: Sweden -- EBITDA at emergence: EUR93 million -- Implied enterprise value-to-EBITDA multiple: 6.5x, in line with standard sector assumptions. Simplified waterfall -- Gross enterprise value: EUR605 million -- Net enterprise value after administrative expenses (5%): EUR575 million -- Estimated super senior debt claims [1][2]: EUR132 million -- Value available for senior secured debt claims: EUR443 million -- Estimated senior secured debt claims [1]: EUR657 million --Recovery rating: '3' (50%-70%, rounded estimate: 65%) [1] All debt amounts include six months of prepetition interest. [2] The RCF is assumed to be 85% drawn at default. POLESTAR AUTOMOTIVE: ADS Ratio Change to 1:30 Takes Effect Dec. 9 ----------------------------------------------------------------- Polestar Automotive Holding UK PLC announced that the effective date for the previously announced plan to change the ratio of its American Depositary Shares to ordinary shares was slated to occur on December 9, 2025. Specifically, the Company's Class A, Class B, Class C-1 and Class C-2 American Depositary Shares ratio to the respective Class A, Class B, Class C-1 and Class C-2 ordinary shares will change from the current ADS Ratio of one ADS to one ordinary share, to the new ADS Ratio of one ADS to 30 ordinary shares. There will be no change to the Company's Class A, Class B, Class-1 or Class C-2 ordinary shares. The effect of the ADS Ratio Change on the trading price of the Class A ADSs and Class C-1 ADSs on the Nasdaq Global Market is expected to take place at the open of trading on December 9, 2025 (U.S. Eastern Time). On the Effective Date, ADS holders of record in certified form will be required on a mandatory basis to surrender their ADSs to the depositary bank for the Company's ADS program, Citibank, N.A., for cancellation and will receive one new ADS in exchange for every 30 existing ADSs then held in connection with the ADS Ratio Change, with further details to be provided in the notice by the Depositary Bank. Holders of uncertificated ADSs in the Direct Registration System and in The Depository Trust Company will have their ADSs automatically exchanged and need not take any action. The exchange of every 30 then-held (existing) ADSs for one new ADS will occur automatically, at the Effective Date, with the then-held ADSs being cancelled and new ADSs being issued by the Depositary Bank. As of the Effective Date, the Company's Class A ADSs will continue to be traded on Nasdaq under the symbol "PSNY" and the Company's Class C-1 ADSs will continue to be traded on Nasdaq under the symbol "PSNYW". No new fractional ADSs will be issued in connection with the ADS Ratio Change. Instead, fractional entitlements to new ADSs will be aggregated and sold by the Depositary Bank and the net cash proceeds from the sale of the fractional ADS entitlements (after deduction of fees, taxes and expenses) will be distributed to the applicable ADS holders by the Depositary Bank. Aside from ADS holders who will receive cash following the sale of their fractional entitlements, the ADS Ratio Change will not impact any ADS holder's percentage ownership of the Company or voting power. As a result of the ADS Ratio Change, the ADS price is expected to increase proportionally, although the Company can give no assurance that the ADS price after the ADS Ratio Change will be equal to or greater than the ADS price on a proportionate basis. About Polestar Automotive Polestar (Nasdaq: PSNY) is the Swedish electric performance car brand with a focus on uncompromised design and innovation, and the ambition to accelerate the change towards a sustainable future. Headquartered in Gothenburg, Sweden, its cars are available in 27 markets globally across North America, Europe and Asia Pacific. Gothenburg, Sweden-based Deloitte AB, the Company's auditor since 2021, issued a "going concern" qualification in its report dated May 9, 2025, attached to the Company's Annual Report on Form 10-K for the year ended December 31, 2024, citing that the Company requires additional financing to support operating and development activities that raise substantial doubt about its ability to continue as a going concern. As of June 30, 2025, the Company had $3.6 billion in total assets, $7.9 billion in total liabilities, and a total deficit of $4.3 billion. =========================== U N I T E D K I N G D O M =========================== ARINIUM LTD: FRP Advisory Appointed as Joint Administrators ----------------------------------------------------------- Arinium Limited was placed into administration proceedings in the High Court of Justice, Court No. CR-2025-008366, and Nedim Ailyan and Paul Atkinson of FRP Advisory Trading Limited were appointed as joint administrators on Nov. 26, 2025. Arinium Limited specialized in the letting and operating of own or leased real estate. Its registered office is at 310 Harrow Road, Wembley, HA9 6LL, to be changed to Centre Block, 4th Floor, Central Court, Knoll Rise, Orpington, BR6 0JA. Its principal trading address is 5 Grange Road, Orpington, Kent, BR6 8ED. The joint administrators can be reached at: Nedim Ailyan Paul Atkinson FRP Advisory Trading Limited 4th Floor, Centre Block Central Court, Knoll Rise Orpington, Kent, BR6 0JA Further details contact: The Joint Administrators Tel: 020 8302 4344 Email: cp.oprington@frpadvisory.com BARLEY HILL NO. 2: S&P Lowers X-Dfrd Notes Rating to 'CCC (sf)' --------------------------------------------------------------- S&P Global Ratings raised its credit ratings on Barley Hill No. 2 PLC's class B and C-Dfrd notes to 'AAA (sf)' from 'AA (sf)' and to 'AA-(sf)' from 'A (sf)', respectively. At the same time, S&P affirmed its 'BBB- (sf)' rating on the class D-Dfrd notes and lowered the ratings on the class E-Dfrd and X-Dfrd notes to 'B- (sf)' from 'B+ (sf)' and to 'CCC (sf)' from 'B- (sf)', respectively. The rating actions reflect its full analysis of the transaction's latest information and current structural features. As of June 2025, total arrears were 31.49%, up from 16.80% at our previous review, while 90+ days arrears were 23.77%, (previously 7.25%). Both metrics exceed our U.K. nonconforming – post-2014 delinquency index; however, total arrears amounts have remained relatively stable. The three-month constant prepayment rate was approximately 55%, and has remained high throughout 2025, consistent with the expected reversion patterns. This has reduced the pool factor to 15%, following the main reversion spikes in 2024 and 2025. S&P expects prepayment rates to continue decreasing, as most reversion peaks have occurred. The transaction has no cumulative losses. S&P said, "Since our previous review, we increased our weighted-average foreclosure frequency assumptions for all rating levels, mainly due to a reduction in severe arrears. On April 4, 2025, we updated our assumptions for overvaluation in U.K. regions. Therefore, our weighted-average loss severity assumptions have decreased at all rating levels--except 'BB' and 'B', where the loss severity is floored at 2%--reflecting lower overvaluation and updated house price index assumptions. Therefore, since our previous review, the required credit coverage has decreased at all rating levels, except 'BB' and 'B.'" Credit analysis results WAFF (%) WALS (%) Credit coverage (%) AAA 40.58 15.97 6.48 AA 35.16 10.91 3.84 A 32.41 4.47 1.45 BBB 29.65 2.26 0.67 BB 26.9 2.00 0.54 B 26.21 2.00 0.52 WAFF--Weighted-average foreclosure frequency. WALS--Weighted-average loss severity. S&P said, "We raised our ratings on the class B and C-Dfrd notes to 'AAA (sf)' from 'AA (sf)' and to 'AA- (sf)' from 'A (sf)', respectively, reflecting the higher credit enhancement. The class B notes are now the most senior in the capital structure and, as outlined in the transaction documents, can no longer defer interest. We limited the potential upgrade of the class C-Dfrd notes due to deteriorating performance and increase in arrears. "The rating on the class D-Dfrd notes is below that indicated by our cash flow analysis. However, we affirmed the rating, considering the tranche's relative position in the capital structure. The affirmation also reflects the tranche's ability to withstand potential repercussions from the cost-of-living crisis, including higher defaults and longer foreclosure timing stresses. "We lowered our rating on the class E-Dfrd notes to 'B-(sf)' from 'B+ (sf)'. Our standard cash flow analysis indicates that this tranche faces shortfalls at all rating levels. Even in a steady-state scenario--where the current stress level shows little to no increase and collateral performance remains steady--the notes continue to face shortfalls at the 'B' rating. However, considering that transaction has experienced no losses since inception and the positive excess spread, we believe that payment of interest and principal on these notes is not dependent on favorable business, financial, and economic conditions. "Our standard cash flow analysis indicates that the class X-Dfrd notes face shortfalls at all rating levels, even in a steady-state scenario. The transaction's step-up date is February 2026 and given the class's repayment speed and excess spread levels, it is unlikely to fully redeem by then. Following the step-up date, this class will be paid its remaining principal outstanding through the principal waterfall after the most senior classes, including E-Dfrd, are exhausted. Therefore, in our view, payment of interest and principal on the class X-Dfrd notes depends on favorable business, financial, and economic conditions. We therefore lowered our rating on the notes." Macroeconomic forecasts and forward-looking analysis S&P expects U.K. inflation to remain above the Bank of England's 2% target in 2025, and we forecast a 3.9% year-on-year change in house prices in Q4 2025. S&P said, "Given our current macroeconomic forecasts and forward-looking view of the U.K. residential mortgage market, we performed additional sensitivities relating to higher default levels due to increased arrears and extended recovery timings, reflecting delays in repossessions owing to court backlogs in the U.K. and the repossession grace period announced by the U.K. government under the Mortgage Charter. We ran eight scenarios with increased defaults and higher loss severities of up to 30%. The sensitivity analysis results indicate a deterioration consistent with our credit stability considerations in our rating definitions." The transaction is backed by a portfolio of owner-occupied mortgage loans secured by properties in the U.K. F4CONTRO LTD: Opus Restructuring Appointed as Joint Administrators ------------------------------------------------------------------ F4Control Limited was placed into administration proceedings in the High Court of Justice, No. 008400 of 2025, and Louise Williams and Luke Brough of Opus Restructuring LLP were appointed as joint administrators on Nov. 27, 2025. F4Control Limited specialized in passenger land transport. Its registered office is at 7 St John Street, Mansfield, Nottinghamshire, NG18 1QH. Its principal trading address is The Old Station, High Street, Edwinstowe, NG21 9HS. The joint administrators can be reached at: Louise Williams Luke Brough (IP No. 31630) Opus Restructuring LLP Bridgford Business Centre 29 Bridgford Road West Bridgford, NG2 6AU Further details contact: Charlotte Jones Tel: 0115 666 8230 Email: nottingham@opusllp.com GLOW INSULATION: Alvarez & Marsal Appointed as Joint Administrators ------------------------------------------------------------------- Glow Insulation & Site Supplies Limited was placed into administration proceedings in the Court of Session, No. P1187/25, and Michael Magnay, Gemma Quinn, and Jonathan Marston of Alvarez & Marsal Europe LLP were appointed as joint administrators on Nov. 26, 2025. Glow Insulation & Site Supplies Limited's agents were involved in the sale of timber and building materials. Its registered office and principal trading address is Thornbridge Yard, Laurieston Road, Grangemouth, FK3 8XX. The joint administrators can be reached at: Michael Magnay Gemma Quinn Jonathan Marston Alvarez & Marsal Europe LLP Suite 3, Avery House 69 North Street Brighton, BN41 1DH Tel: +44 (0) 20 7715 5200 For further information, contact: Dimitri Golovanovs Alvarez & Marsal Europe LLP Tel: +44 (0) 20 7715 5223 Email: INS_GLISSL@alvarezandmarsal.com KANABO GROUP: RSM UK Advisory Appointed as Joint Administrators --------------------------------------------------------------- Kanabo Group PLC was placed into administration proceedings in the Business and Property Courts of England and Wales, Insolvency and Companies List (ChD), Court No. CR-2025-008423, and Damian Webb and Stephanie Sutton of RSM UK Restructuring Advisory LLP were appointed as joint administrators on Nov. 28, 2025. Kanabo Group PLC specialized in other business support service activities not elsewhere classified. Its registered office and principal trading address is Churchill House, 137-139 Brent Street, London, NW4 4DJ. The joint administrators can be reached at: Damian Webb Stephanie Sutton RSM UK Restructuring Advisory LLP 25 Farringdon Street London, EC4A 4AB Correspondence address & contact details of case manager: Anh Pham RSM UK Restructuring Advisory LLP 25 Farringdon Street London, EC4A 4AB Tel: 020 3201 8000 Alternative contact: The Joint Administrators Tel: 020 3201 8000 NATIONAL TIMBER GROUP: Alvarez & Marsal Appointed as Administrators ------------------------------------------------------------------- National Timber Group Midco Limited was placed into administration proceedings in the High Court of Justice, Business & Property Courts in Manchester, No. CR-2025-MAN-001578, and Michael Magnay, Gemma Quinn, and Jonathan Marston of Alvarez & Marsal Europe LLP were appointed as joint administrators on Nov. 26, 2025. National Timber Group Midco Limited specialized in activities of production holding companies. Its registered office and principal trading address is Bramall Lane, Sheffield, South Yorkshire, S2 4RJ. The joint administrators can be reached at: Michael Magnay Gemma Quinn Jonathan Marston Alvarez & Marsal Europe LLP Suite 3, Avery House 69 North Street Brighton, BN41 1DH Tel: +44 (0) 20 7715 5200 For further information, contact: Dimitri Golovanovs Alvarez & Marsal Europe LLP Tel: +44 (0) 20 7715 5223 Email: INS_NATGML@alvarezandmarsal.com NATIONAL TIMBER: Alvarez & Marsal Appointed as Administrators ------------------------------------------------------------- National Timber Group England Limited was placed into administration proceedings in the High Court of Justice, Business & Property Courts in Manchester, No. CR-2025-MAN-001577, and Michael Magnay, Gemma Quinn, and Jonathan Marston of Alvarez & Marsal Europe LLP were appointed as joint administrators on Nov. 26, 2025. National Timber Group England Limited's agents were involved in the sale of timber and building materials. Its registered office and principal trading address is Bramall Lane, Sheffield, S2 4RJ. The joint administrators can be reached at: Michael Magnay Gemma Quinn Jonathan Marston (IP No. 14392) Alvarez & Marsal Europe LLP Suite 3, Avery House 69 North Street Brighton, BN41 1DH Tel: +44 (0) 20 7715 5200 For further information, contact: Dimitri Golovanovs Alvarez & Marsal Europe LLP Tel: +44 (0) 20 7715 5223 Email: INS_NATGEL@alvarezandmarsal.com NORTHROW LIMITED: Kroll Advisory Appointed as Joint Administrators ------------------------------------------------------------------ NorthRow Limited was placed into administration proceedings in the High Court of Justice, Business and Property Courts of England and Wales, Insolvency and Companies List (ChD), Court No. CR-2025-007771, and Philip Dakin and Benjamin John Wiles of Kroll Advisory Ltd were appointed as joint administrators on Dec. 1, 2025. NorthRow Limited specialized in business and domestic software development. Its registered office is at 85 Great Portland Street, First Floor, London, W1W 7LT. Its principal trading address is Spaces Lewis Building, 35 Bull Street, Birmingham, B4 6AF. The joint administrators can be reached at: Philip Dakin Benjamin John Wiles Kroll Advisory Ltd The News Building, Level 6 3 London Bridge Street London, SE1 9SG Further details contact: The Joint Administrators Kroll Advisory Ltd Tel: 020 7089 4700 Alternative Contact: Sam Pryor Email: Sam.Pryor@Kroll.com PETROFAC LTD: S&P Withdraws 'D' ICR After Administration Filing --------------------------------------------------------------- S&P Global Ratings withdrew its 'D' (default) issuer and issue credit ratings on Petrofac Ltd. This follows our last rating action, when we lowered our issuer credit rating on Petrofac to 'D' after it was placed under administration on Oct. 28, 2025. SCOTIA ROOFING: Alvarez & Marsal Appointed as Joint Administrators ------------------------------------------------------------------ Scotia Roofing & Building Supplies Ltd. was placed into administration proceedings in the Court of Session, No. P1188/25, and Michael Magnay, Gemma Quinn, and Jonathan Marston of Alvarez & Marsal Europe LLP were appointed as joint administrators on Nov. 26, 2025. Scotia Roofing & Building Supplies Ltd.'s agents were involved in the sale of timber and building materials. Its registered office and principal trading address is Thornbridge Yard, Laurieston Road, Grangemouth, FK3 8XX. The joint administrators can be reached at: Michael Magnay Gemma Quinn Jonathan Marston Alvarez & Marsal Europe LLP Suite 3, Avery House 69 North Street Brighton, BN41 1DH Tel: +44 (0) 20 7715 5200 For further information, contact: Dimitri Golovanovs Alvarez & Marsal Europe LLP Tel: +44 (0) 20 7715 5223 Email: INS_SCRBSL@alvarezandmarsal.com SHERWOOD PARENTCO: Fitch Lowers LongTerm IDR to 'B', Outlook Stable ------------------------------------------------------------------- Fitch Ratings has downgraded Sherwood Parentco Limited's (Arrow) Long-Term Issuer Default Rating (IDR) to 'B' from 'B+'. The Outlook is Stable. Fitch has also downgraded Sherwood Financing Plc's senior secured debt, guaranteed by Arrow (and other Sherwood entities) to 'B' from 'B+'. The downgrade reflects Fitch's expectation that Arrow's leverage (Fitch-calculated gross debt to adjusted EBITDA) will remain high in 2026 amid continuing loss making, albeit capital-light income is expected to build but recent fundraising will take time to be deployed, and realisations can be uncertain. Arrow is the parent company of Sherwood Acquisitions Limited, a UK-based entity set up by TDR Capital LLC (and owned by investment funds managed by TDR Capital LLP) to acquire Arrow Global Group, a European fund manager specialising in a range of distressed and performing assets. Key Rating Drivers Arrow's ratings are constrained by its high leverage profile during its business model transition and Fitch's expectation of leverage remaining above 4.5x gross debt to adjusted EBITDA over the next 12 months. The ratings also reflect Arrow's modest scale and reported net losses during this transition phase. This is weighed against the anticipated medium- to longer-term benefits from Arrow's asset-light strategy, progressively differentiating it from more direct investors in distressed assets, and its lack of near-term refinancing need. Capital-Light Shift: Over the last five years, Arrow has reduced its traditional debt purchasing activities, acting as a manager of funds investing in a wider range of distressed and performing assets, and as the servicer of those assets. Under the revised business model, its balance sheet usage reduces principally to co-investments in funds and decreased to 7% in its most recent real estate lending fund 'ALO1', having been 25% in its inaugural credit opportunities fund 'ACO1', launched in 2019. Arrow's 2024 asset purchases for its own balance sheet were only GBP156 million, far lower than pre-pandemic levels. By end-3Q25, Arrow's funds under management (FUM) had increased to EUR13.6 billion following good year to date fundraising. Fee-earning net asset value was EUR4.6 billion. The long-term FUM growth rate remains sensitive to the performance of funds launched, none of which has completed its life cycle, as well as continued investor appetite for investments in non-performing and real estate assets. Still Below Break-Even: Arrow's business generates material EBITDA, but net earnings remain negative since the adoption of its revised model. It had a pre-tax loss of GBP96million in 9M25 (2024: GBP 70 million; 2023: GBP125 million), after accounting for high financing costs. FUM expansion, increase in deployments and delivering returns on the early co-investments should help the company move towards profitability. Leverage Constrains Rating: Arrow retains large borrowings and its Long-Term IDR is constrained by associated material leverage, with a Fitch-calculated gross debt/adjusted EBITDA ratio of around 6x at end-3Q25 (pro forma for the disposal of Zenith Service SpA). Like many European distressed asset purchasers, the company's tangible equity is negative following material inorganic expansion, and this weighs on its capitalisation and leverage assessment. Management targets net cash flow leverage at 3.0x over the medium term, which Fitch believes would require a substantial increase in revenue from integrated fund management as the reduced co-investment requirement will lead to lower funding needs. Refinanced Debt Structure: In 4Q24, Arrow refinanced its bonds due in 2026 and 2027, extending their maturities to December 2029. The company also replaced its existing GBP285 million revolving credit facility (RCF) with a new facility for the same amount, now maturing in June 2029, to bolster liquidity. Its EBITDA/interest expense ratio remains adequate for the current rating. Fitch's assessment of Arrow's funding, liquidity and coverage profile also takes into account its predominantly secured and confidence sensitive wholesale funding sources. Diversification of Income: Arrow's scale is below that of higher-rated alternative asset managers (measured by assets under management) and debt purchasers (measured by estimated remaining collections). However, the company's local presence in multiple European markets enables it to target smaller and often off-market transactions, which are typically less price sensitive than auction-led deals. RATING SENSITIVITIES Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade Further deterioration in cash flow leverage or inability to materially reduce pre-tax losses. Material underperformance in asset realisations, leading to large portfolio impairments. Weakening of Arrow's corporate governance, or other evidence of increased risk appetite. Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade Sustained improvement in Arrow's gross leverage ratio to below 4.5x alongside a path to breakeven in conjunction with sound fund performance that generates co-investment profits and facilitates investor support for investment in future funds. DEBT AND OTHER INSTRUMENT RATINGS: KEY RATING DRIVERS Sherwood Financing Plc's GBP1.5 billion equivalent senior secured notes are guaranteed by Arrow. In December 2024, these notes were refinanced into three tranches due December 2029: EUR965 million at a floating rate; EUR250 million at 7.625%; and GBP250 million at 9.625%. As Arrow's senior secured notes are its main outstanding debt class (and effectively junior to the company's GBP285 million RCF), Fitch has equalised the notes' ratings with the Long-Term IDR, indicating average recoveries for the notes. DEBT AND OTHER INSTRUMENT RATINGS: RATING SENSITIVITIES A downgrade of the Long-Term IDR would likely be mirrored in a downgrade of the notes. In addition, worsening recovery expectations, for instance, through a larger layer of structurally senior debt, could lead Fitch to notch down the notes' rating from the Long-Term IDR. An upgrade of the Long-Term IDR would likely be mirrored in an upgrade of the notes. In addition, improved recovery expectations, for instance, through a larger layer of junior debt, could lead Fitch to notch up the notes' rating from Arrow's Long-Term IDR. ESG Considerations Arrow has an ESG Relevance Score of '4' for 'Financial Transparency' due to the importance of internal modelling to portfolio valuations and associated metrics, such as estimated remaining collections. However, this is a feature of the debt-purchasing sector as a whole, and not specific to the company. This has a moderately negative impact on the credit profile and is relevant to the rating 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 Prior ----------- ------ ----- Sherwood Parentco Limited LT IDR B Downgrade B+ Sherwood Financing Plc senior secured LT B Downgrade B+ ********* 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 * * *