260625.mbx

260625.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, June 25, 2026, Vol. 27, No. 126 Headlines F R A N C E FINANCIERE TOP: Fitch Affirms 'B+' LongTerm IDR, Outlook Stable MISTRAL HOLDCO: S&P Assigns 'B' ICR, Outlook Negative PAPREC HOLDING: Fitch Affirms 'BB' LongTerm IDR, Outlook Stable G E R M A N Y HT TROPLAST: S&P Affirms 'B' ICR & Alters Outlook to Stable PROTECT HOLDCO: Fitch Affirms 'B+' LongTerm IDR, Outlook Stable G R E E C E PUBLIC POWER: S&P Raises LT ICR to 'BB' on Accelerated Growth I R E L A N D ARES EUROPEAN XIX: S&P Assigns B-(sf) Rating on Class F Notes CANYON EURO CLO 2026-1: S&P Assigns B-(sf) Rating on Cl. F Notes CAPITAL FOUR XII: S&P Assigns B-(sf) Rating on Class F Notes CVC CORDATUS XXXI: Fitch Affirms B-sf Final Rating on Cl. F-2 Notes FERNHILL PARK: S&P Assigns B-(sf) Rating on Class F-R Notes TORO EUROPEAN 6: Fitch Corrects May 29 Rating Action I T A L Y OMNIA TECHNOLOGIES: Fitch Affirms 'B' LongTerm IDR, Outlook Stable L U X E M B O U R G HSE INVESTMENT: Fitch Alters Outlook on 'B-' IDR to Positive S W E D E N RAMUDDEN GLOBAL: S&P Withdraws 'B' LongTerm Issuer Credit Rating U N I T E D K I N G D O M FRONTIER MORTGAGE 2026-1: S&P Assigns BB(sf) Rating on Cl X Notes OBAN CARDS 2026-1: S&P Assigns BB+(sf) Rating on Class E Notes ZENTIA PROFILES: Interpath Advisory Appointed as Administrators - - - - - =========== F R A N C E =========== FINANCIERE TOP: Fitch Affirms 'B+' LongTerm IDR, Outlook Stable --------------------------------------------------------------- Fitch Ratings has affirmed Financiere Top Mendel SAS's Long-Term Issuer Default Rating (IDR) at 'B+' with Stable Outlook. Fitch has also affirmed the 'BB-' senior secured rating of the term loan B (TLB) issued by Financiere Mendel S.A.S., the US dollar tranche of which is co-issued by Mendel US Holdings LLC. The Recovery Rating is 'RR3'. Financiere Mendel S.A.S. is a Financiere Top Mendel subsidiary and directly owns Ceva Sante Animale S.A., the France-based manufacturer of animal health products. The rating reflects EBITDA leverage remaining above its 5.5x negative sensitivity in 2026 for the third year in a row, with the proposed EUR300 million add-on further reducing rating headroom. However, Fitch expects leverage to return below the negative sensitivity in 2027, driven by continued strong organic growth across all business divisions and improving cost management, which should gradually improve EBITDA margins. Fitch expects increasing free cash flow (FCF) generation from mildly positive levels to support deleveraging capacity. This underscores the Stable Outlook. Key Rating Drivers Strong Profitability: Ceva generates healthy EBITDA margins, supported by a diversified portfolio of pharmaceutical and biological animal health solutions and leading positions across key species. Margin resilience is aided by geographic diversification and constant investments in innovations supporting operating efficiency. Fitch expects the EBITDA margin to continue gradually improving to above 30% by 2029, from 28% in 2025, driven by operating efficiencies and better pricing mix as the company increases the complexity of its offered treatments. EBITDA Growth Supports Deleveraging Trajectory: Fitch estimates Ceva's EBITDA leverage will remain at around its negative leverage sensitivity of 5.5x in 2026 after the proposed EUR300 million add-on results in low rating headroom at 'B+'. Fitch however forecasts leverage will improve due to sustained EBITDA expansion and gradual FCF margin improvement, given its investment cycle. Fitch expects the add-on to be invested in growth opportunities, without causing a permanent leverage increase and to accelerate the deleveraging trajectory over its rating case. In its view, the company's leverage metrics have no rating headroom for significant underperformance or debt-funded acquisitions after successive debt raises in the past three years. This has led to leverage remaining at or slightly above the 5.5x negative sensitivity for the past two years, which Fitch expects to be breached this year. Improving FCF: Ceva's FCF has turned positive for two years, driven by EBITDA growth and gradually diminishing capex, which peaked in 2024. Fitch forecasts capex intensity will remain high at 11%, which together with high interest payments, will keep the FCF margin under pressure in 2026. The company's underlying deleveraging capability is underpinned by its healthy operating profitability and cash from operations, and Fitch forecasts FCF to remain neutral to marginally positive in 2026 and 2027, before gradually improving towards the mid-single digits by 2029. Robust Business Model: Fitch views Ceva's business model as robust, given its well-diversified product portfolio across species, balanced geographic footprint with broad representation in developed and emerging markets, and entrenched market positions in well-defined niche product areas. This is reflected by the company's record of delivering organic sales growth and solid operating margins through the cycle, resulting in strong scale increase over the last four years. However, Ceva ranks among niche scale pharmaceutical companies globally, benefiting from robust EBITDA margins projected above 30% through 2028. Supportive Market Fundamentals: The rating reflects its view that Ceva benefits from supportive market trends driving long-term demand and market propensity for accelerated consolidation. The animal health market offers many growth areas, backed by rising consumption of animal-based proteins linked to a growing population, rising incomes in emerging markets, and advanced farming methods requiring innovative therapies. Greater awareness of animal health for both farm and companion animals and wellbeing in developed countries shifting the focus to prevention from cure also supports the favourable trend. Peer Analysis Ceva's main peers are Elanco Animal Health Incorporated (BB/Stable), and Dechra Topco Limited (B+/Negative). The two-notch rating difference with Elanco reflects Ceva's much smaller scale and higher leverage, following Elanco's debt reduction in 2024. Dechra balances smaller scale and higher leverage with a greater focus on the companion animal segment with structurally higher growth than the overall farm animal market, although Ceva has significant exposure to high-growth poultry vaccines. Dechra's expected heavy investments on its next generation of products to the end of the decade limits its FCF generation and underscores its Negative Outlook. Pharmaceutical companies in the 'B' rating category are normally small, niche or generic businesses with concentrated portfolios or balance sheets. Ceva's business model has similarities with Nidda BondCo GmbH (Stada; B/Stable), although its comparative lack of scale is balanced by greater geographic reach and materially lower leverage. Other asset-intensive pharma peers, such as European Medco Development 3 S.a.r.l. (Axplora; (B-/Stable) and Roar Bidco AB (Recipharm; B/Stable), have higher leverage and for Axplora, a weaker business model, given exposure to higher product concentration and execution risks. Asset-light pharma companies, like CHEPLAPHARM Arzneimittel GmbH (B/Stable) and ADVANZ PHARMA HoldCo Limited (B/Negative), have similar leverage profiles, but stronger operating profitability and FCF generation, which offset their limited scale and greater portfolio concentration risks. Fitch’s Key Rating-Case Assumptions - Mid-to-high single-digit organic revenue growth in 2026, driven by all segments. This is partly offset by a mid-single digit negative FX impact. Mid-single digit organic revenue growth in 2027-2029 - EBITDA margin of 28% in 2026, before gradually improving to 30.4% by 2029 - Trade working capital at 3.5%-4% of sales in 2026-2029, supporting sales growth - High capex intensity of 11% in 2026-2029 - Total bolt-on acquisitions of EUR170 million in 2026-2029, funded by internal cash generation Corporate Rating Tool Inputs and Scores Fitch scored the issuer as follows, using its Corporate Rating Tool (CRT) to produce the Standalone Credit Profile (SCP): Business and financial profile factors (assessment, relative importance): management ('bb', Moderate), sector characteristics ('bbb+', Lower), market and competitive positioning ('b+', Higher), diversification and asset quality ('bbb', Moderate), company operational characteristics ('bbb', Moderate), profitability ('bbb-', Moderate), financial structure ('b', Higher), and financial flexibility ('bb-', Moderate). The quantitative financial subfactors are based on standard CRT financial period parameters: 20% weight for the historical year 2025, 40% for the forecast year 2026 and 40% for the forecast year 2027. B+ to CC considerations apply in its analysis and have no impact. The governance assessment of 'good' has no impact. The operating environment assessment of 'a' has no impact. The SCP is 'b+'. To derive the Long-Term IDR: Fitch made no adjustments to the SCP, resulting in an IDR of 'B+'. Recovery Analysis - The recovery analysis assumes that Ceva would be considered a going concern (GC) in bankruptcy and reorganised rather than liquidated. This is driven by the company's brand, quality of its product portfolio and established global market position. - Fitch estimates Ceva would have post-reorganisation GC EBITDA of about EUR310 million. Fitch has revised the GC from EUR250 million due to sustained strong performance over the last three years resulting in almost 1.5x larger scale and EBITDA generation. The GC EBITDA takes into consideration product contamination or similar compliance issues, or infectious disease outbreaks affecting various species in several regions akin to African swine fever. The assumption also reflects corrective measures taken in the reorganisation to offset the adverse conditions that trigger default. - Fitch assumes a 10% administrative claim. - Fitch uses a 6.5x multiple to calculate a post-reorganisation enterprise valuation, which is comparable with multiples applied to some pharmaceutical peers. This multiple reflects Ceva's strong organic growth potential, high underlying profitability and protected niche market positions. - Its principal waterfall analysis generated a ranked recovery in the 'RR3' band for its all senior secured capital structure, comprising a EUR2.1 billion TLB, USD695 million (EUR601 million equivalent) TLB, the proposed add-on of about EUR300 million equivalent and a EUR100 million revolving credit facility, assumed to be fully drawn prior to distress in accordance with its methodology, with all facilities ranking pari passu. Fitch excludes the senior secured creditor mass bilateral facilities of about EUR214 million at end-March 2026 as these are unsecured financial obligations. RATING SENSITIVITIES Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade - Evidence of weakening operating performance, operational breakdowns (product issues/non-compliance) or M&A missteps leading to EBITDA margins below 23% - EBITDA leverage at or above 5.5x - Opportunistic shareholder distributions constraining Ceva's ability to invest in business and grow organically in the mid-single digits - Continuously negative FCF generation Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade - Solid operating performance with turnover growing in the high single digits, alongside EBITDA margins expanding towards 30%. - Reduction in EBITDA leverage below 4.5x on a sustained basis - Commitment to a more conservative financial policy - FCF margins sustained in the mid-to-high single digits Liquidity and Debt Structure At end-March 2026, Ceva reported Fitch-defined readily available cash of EUR325 million (after adjustment for restricted cash of EUR25 million). It has no material upcoming debt repayment maturities and expected positive FCF generation will support liquidity. The proposed add-on of EUR300 million will be fungible to the existing TLB. It also has a EUR100 million revolving credit facility due 2030 to support liquidity. The company's sources of funding are concentrated and mainly consist of EUR2.1 billion and USD695 million (EUR600 million equivalent) TLBs that are due to be repaid in November 2030. The expected add-on should improve its liquidity given its long-term maturity. Issuer Profile Ceva is an animal health company that develops, manufactures and distributes a large portfolio of pharmaceutical products and vaccines for poultry, swine, ruminants and companion animals. 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. Climate Vulnerability Signals The results of its Climate.VS screener did not indicate an elevated risk for Ceva and its subsidiaries. ESG Considerations Ceva has an ESG Relevance Score of '4' for Customer Welfare - Fair Messaging, Privacy & Data Security due to regulatory interventions and the shift of end-consumer preferences away from the use of antibiotics in feed for animals, 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 ----------- ------ -------- ----- Financiere Top Mendel SAS LT IDR B+ Affirmed B+ Financiere Mendel S.A.S. senior secured LT BB- Affirmed RR3 BB- Mendel US Holding LLC senior secured LT BB- Affirmed RR3 BB- MISTRAL HOLDCO: S&P Assigns 'B' ICR, Outlook Negative ----------------------------------------------------- S&P Global Ratings assigned its 'B' long-term issuer credit rating on France-based Mistral Holdco SAS (Meilleurtaux) and its 'B' issue rating and '3' recovery rating on its senior secured term loan. The negative outlook indicates that we could lower the rating if Meilleurtaux underperforms our base case, or financial policy decisions delay its deleveraging, leading to S&P Global Ratings-adjusted debt to EBITDA remaining above 7.0x for a prolonged period, or negative cash flow generation and FFO cash interest coverage materially below 2.0x. Mistral Holdco SAS (Meilleurtaux) is proposing an amend and extend transaction to extend the maturity of its first-lien term loan B (TLB) to February 2031 and upsize it to EUR500 million (from the existing EUR420 million), primarily to repay EUR50 million of the revolving credit facility (RCF) that was drawn to finance the acquisition of Peasy, a Belgium-based broker for housing finances. The transaction will also look to upsize the RCF to EUR65 million while extending its maturity to August 2030. S&P said, "We forecast that continued solid revenue growth momentum, driven primarily by market share gains in savings and investments and ongoing recovery in mortgage volumes in France, will support an S&P Global Ratings-adjusted deleveraging to 7.1x in 2026 and 6.3x in 2027, from 7.7x in 2025. We also anticipate that funds from operations (FFO) cash interest coverage will remain close to 2.0x, alongside our positive adjusted free operating cash flow (FOCF) generation of about EUR14 million (excluding transaction costs) in 2026 and EUR21 million in 2027. Yet, these credit metrics leave little room for operating underperformance in an uncertain macroeconomic environment, merger and acquisition (M&A) integration headwinds, or financial policy decisions that could delay deleveraging. "In our view, the proposed transaction will improve Meilleurtaux's debt maturity profile. The company plans to extend the maturity of its term loan to February 2031 and upsize it by EUR80 million, to EUR500 million. The incremental TLB will be used to repay EUR50 million of the RCF that was drawn to finance the acquisition of Peasy, a leading Belgium-based broker for housing finances and add cash on the balance sheet. Additionally, the company plans to extend the maturity of its RCF to August 2030 and upsize it by EUR15 million, to EUR65 million. "We think that Meilleurtaux's leading position as a provider of financial services in France, Belgium, and Luxembourg underpins the rating. In our view, the company's business risk profile is supported by its position in France as the leading omnichannel financial brokerage platform, holding the No. 1 market position in loan insurance brokerage and credit brokerage, co-leader position in savings and investments brokerage and the third-largest price comparison tool, also active in business-to-customer and business-to-business-to-customers within the health and general insurance segment." From being a pure play credit platform, Meilleurtaux has diversified its business into other complimentary services in insurance and savings and offers financial products across the brokerage value chain including advisory, distribution, and administrative services for individuals and businesses. It provides a multiplatform offering with an established online marketplace via Meilleurtaux.com, complemented by a large network of more than 330 branches (mainly franchised), more than 900 advisors via call-centers, and a wholesale activity site. These factors frame Meilleurtaux's strong brand awareness, which has resulted in solid market shares in its core markets. The business diversification and recurring nature of about 75% of the business have enabled the company to withstand the market headwinds that affected its credit business in recent years. Revenue has remained broadly flat since 2022, while mortgage production volumes contracted by more than 40% in France. The emergence of AI-based insurance comparison tools poses a risk to Meilleurtaux's business model. Nevertheless, its strong brand, entrenched partnerships with banks and insurers, and physical distribution channels create barriers to entry and limit disintermediation risk. The company also invests in AI to boost customer service and productivity, and has partnered with ChatGPT to launch a mortgage simulation tool. Relatively small scale and limited geographic diversification constrain the rating. The business risk profile is constrained by its relatively small scale, particularly among peers within the comparison and financial brokerage services. The company's strong marketing presence provides some protection, considering the barrier to entry, but S&P notes that the market remains very fragmented. Although improving with recent acquisitions, the company's meaningful exposure to France (contributing 83% of revenue pro forma for the Peasy acquisition) makes the company vulnerable to regulatory developments in the market. Regulatory developments to date have been positive for the industry, as illustrated by the most recent "Loi Lemoine", a reform law concerning the mortgage insurance market, which will continue to drive growth in individual mortgage insurance contracts. The company is materially exposed to some insurance and banking partners, although concentration is decreasing. The presence of broad network of partners partially mitigates the exposure because the capacity of any top partner could be supplemented by other partners. S&P forecasts that supportive industry trends and the company's strategic initiatives will underpin continued solid revenue growth in 2026 and 2027. In 2025, gross revenue increased by about 3%, driven by a rebound in mortgage production in France, underpinned by decreasing interest rates, and a solid growth in savings and investments supported by proprietary product launches and high take-up rates. This was tempered by a decline in insurance business due to the temporary impact of a strategic shift from upfront commissioning of health insurance to more stable recurring commission model, and softness in the motor insurance market. Growth accelerated quarter on quarter, reaching 11% in the last quarter of 2025. S&P said, "We forecast gross revenue growth of 9%-10% per year in 2026-2027 on a like-for-like basis, and about 26% including the integration of Peasy in 2026. The continued momentum in savings and investments, as geopolitical and macroeconomic uncertainties boost customers' savings in France, will fuel growth. We expect intermediation to continue and Meilleurtaux to capture a growing share of the market, thanks to its strong brand and cross-selling initiatives. In the credit segment, continued market recovery in the context of stabilized mortgage rates, and the company's enhanced sales, marketing, and distribution efforts across its own platform and its network of franchisees and advisors will underpin growth. While interest rates have increased since the start of the conflict in the Middle East, we understand that French banks have not passed it on to mortgage rates, supporting volumes. Nevertheless, a prolonged conflict with a deeper macroeconomic impact could slow the market recovery, in our view. We anticipate the insurance business to grow in 2026, although at a moderate pace. "We forecast some profitability improvements after the dilutive effect of the integration of Peasy. The company has a relatively flexible cost base, supported by the strong franchise model under which Meilleurtaux operates. This has aided the company maintaining an S&P Global Ratings-adjusted EBITDA margin of about 30% through the cycle, except in 2024 when the company invested in sales, marketing, and IT to support its insurance and savings brokerage activities and enhance customers' experience, while revenue growth was subdued. We forecast a broadly stable adjusted EBITDA margin in 2026, thanks to operating leverage and reduced nonrecurring expenses but also including the consolidation of Peasy (which has lower margins on gross revenue because of its reliance on franchise induces a higher retrocession level). We expect that the adjusted EBITDA margin will then increase by 100 basis points (bps)-150 bps in 2027 as the company benefits from economies of scale and cost savings, and cross-selling and cost synergies with Peasy, whose product portfolio complement's Meilleurtaux's in Belgium. We understand that the IT development costs incurred by Meilleurtaux are for internal use, therefore, we do not adjust for these costs in EBITDA. "Based on these assumptions, we forecast gradual deleveraging. We anticipate that S&P Global Ratings-adjusted debt to EBITDA will reduce to 7.1x in 2026 and 6.3x in 2027, from 7.7x in 2025. Although M&A remains part of Meilleurtaux's strategy to complement its product portfolio, we do not anticipate any significant debt-funded acquisition in the near term, as the company focuses on the integration of Peasy. We forecast that FFO cash interest coverage will remain close to 2.0x in 2026 before improving to 2.2x in 2027. These metrics are commensurate with our 'B' rating, although they leave little room for underperformance, higher-than-expected exceptional costs, or further debt-funded M&A. We acknowledge the company's track record in successfully integrating M&A, and its stated near-term focus on integrating Peasy rather than engaging in other material acquisitions. "Positive FOCF and healthy liquidity support the rating. Helped by increasing EBITDA and stable annual capital expenditure (capex) of about EUR17 million annually, we forecast S&P Global Ratings-adjusted FOCF of about EUR9 million in 2026 (including EUR5 million transaction costs) and EUR21 million in 2027. We understand that the company has frontloaded some material investments in recent years, which should reduce capex as a percentage of sales in future years. With EUR65 million cash on the balance sheet and a fully undrawn EUR65 million RCF, pro forma for the transaction, the company has healthy liquidity that it could use to fund bolt-on acquisitions. "The negative outlook indicates that we could lower the rating if Meilleurtaux underperforms our base case, or financial policy decisions delay its deleveraging, leading to S&P Global Ratings-adjusted debt to EBITDA remaining above 7.0x for a prolonged period, or negative cash flow generation and FFO cash interest coverage materially below 2.0x. "We could lower our rating within the next 12 months if Meilleurtaux experienced adverse trading conditions, competitive pressures, or headwinds in integrating Peasy, resulting in delayed deleveraging, negative FOCF, or FFO cash interest coverage not expected to improve above 2.0x." Alternatively, financial policy decisions--including debt-funded M&A or dividends that result in adjusted debt to EBITDA staying above 7.0x on a sustained basis--could result in a downgrade. S&P said, "We could also lower the rating if Meilleurtaux is unable to successfully refinance its debt well ahead of maturities. "We could revise the outlook to stable if we gained further evidence that the strong revenue growth expected in the next 12 months will drive Meilleurtaux's deleveraging below 7.0x, FFO cash interest coverage increasing toward 2.0x, and increasing FOCF." PAPREC HOLDING: Fitch Affirms 'BB' LongTerm IDR, Outlook Stable --------------------------------------------------------------- Fitch Ratings has affirmed French waste management operator Paprec Holding SA's Long-Term Issuer Default Rating (IDR) at 'BB' with a Stable Outlook and the senior secured ratings on its outstanding bonds at 'BB+' with Recovery Ratings of 'RR3'. The affirmation reflects Paprec's robust 2025 performance, large contract wins and high customer renewal rates, supporting earnings visibility, while the debt maturity profile is well balanced. These improvements are balanced against intense expected M&A activity, which will drive EBITDA net leverage towards its negative sensitivity. The Stable Outlook reflects Fitch's rating case, with leverage consistent with the current rating. Moreover, Fitch expects that Paprec will maintain a disciplined financial policy and take corrective measures if leverage rises above expectations. Key Rating Drivers Robust 2025 Performance: Paprec's operating performance remained strong in 2025, following a solid 2024. Fitch-defined EBITDA rose by 27% to EUR397 million, supported primarily by volume growth in waste services and to a lesser extent, by price increases. Fitch-defined EBITDA margin expanded to 12.5% from 11.3% in 2024, demonstrating the group's ability to pass through cost inflation and preserve solid pricing power, with acquisitions supportive of the margin trend. EBITDA growth and slightly positive free cash flow (FCF) drove an improvement in Fitch-defined EBITDA net leverage to 3.3x in 2025, from 3.6x in 2024. Trading remained positive in 1Q26, with revenue growth of 8% and private-sector contract renewal rates close to 100%, although the EBITDA margin softened slightly due to a larger cost base following the integration of acquired businesses. Increased Focus on External Growth: Paprec has accelerated its selective inorganic growth strategy, completing three bolt-on acquisitions in 1Q26 and progressing with the acquisition of Pizzorno Environnement. Fitch understands management intends to remain focused on small- to medium-sized, family-owned and regional waste-management targets that offer synergies and are relatively easy to integrate, supporting further growth in scale, service offering and geographic footprint. The completed and planned transactions are expected to be funded largely through the December 2025 EUR275 million tap issuances, while Fitch's rating case also assumes additional M&A of about EUR350 million EV over 2026-2028. This strategy could temporarily increase EBITDA net leverage above Fitch's negative sensitivity of 3.9x, but Fitch expects management to remain disciplined in executing its acquisition strategy. Negative FCF, Higher Leverage: Fitch expects EBITDA net leverage to increase to around 4.0x in 2026, reflecting materially negative post-acquisition FCF, also given the additional acquisitions incorporated in its rating case. Fitch expects only moderate deleveraging through 2028 to about 3.6x, as healthy EBITDA growth is likely to be partly offset by continued negative FCF and ongoing acquisition activity. Commitment to Financial Policy Key: Fitch expects the company to demonstrate a strong commitment to maintaining net debt/EBITDA at a level consistent with the 'BB' rating. Fitch expects leverage headroom to be exhausted in 2026, but assume that management will closely monitor this metric and take corrective measures if the contribution from acquired entities falls below expectations. Fitch would also expect equity support for any large M&A transaction that could result in a sustained breach of the negative rating sensitivity. Contract Wins Support Revenue Visibility: Paprec secured several sizeable long-term public contracts in 2025, further reinforcing its position in French energy from waste and recycling infrastructure. These included major concessions and public service delegations in Lagny-sur-Marne, Vedène and the Anjou region. Combined with successful expansion in Spain, total tender lifted backlog to EUR14 billion from EUR12 billion in 2024, strengthening medium-term earnings visibility and diversification. Core Recycling Business: Paprec benefits from a diversified business mix, with revenue generated from waste services (about 54% of 2025 revenue), sales of secondary raw materials (30%) and waste-to-energy (16%). The largely contracted nature of the business, combined with a granular and diversified customer base, supports stable and predictable waste flows. Recycled raw material prices are inherently volatile, but indexation clauses and service fees provide gross margin protection. This contractual structure has underpinned resilient operating performance during periods of market disruption, including the 2023 energy crisis, when EBITDA fell by only 4%. Strengthened Debt Profile: The group issued two new senior secured note tranches of EUR550 million and EUR300 million in July 2025, maturing in July 2030 and July 2032, with fixed coupons of 4.125% and 4.500%, respectively, to refinance EUR800 million of more expensive existing debt. In December 2025, the group also completed a EUR275 million tap issuance, with proceeds earmarked for development needs, notably M&A and general corporate purposes. Fitch considers that these issuances improved Paprec's refinancing profile and provides adequate protection against interest-rate risk. Peer Analysis Fitch views Seche Environnement S.A. (BB/Stable) and Derichebourg S.A. (BB+/Rating Watch Negative) as Paprec's closest peers, both medium-sized waste management companies operating primarily in France. Seche specialises in hazardous waste management, which is subject to strict technical requirements with high barriers to entry and pricing power. However, Paprec has reported consistently healthy growth and growing margins in recent years. Overall, Fitch views the debt capacity of both companies as becoming closer since Paprec is increasing its size and diversification and showing consistent margins. Derichebourg is a pure recycling specialist leading the metal (ferrous and non-ferrous) recycling business in France and Spain. Paprec and Derichebourg operate dense networks of collection and processing sites, with Paprec benefiting from a more diversified waste mix, service offering and indexation clauses. Derichebourg has a stronger presence outside France and its higher rating largely reflects its more conservative financial policy and lower leverage. Spanish waste management operators Luna 2.5 S.a.r.l. (B/Stable) and FCC Servicios Medio Ambiente Holding, S.A. (BBB-/Stable) operate under long-term concession contracts with municipalities, and are largely shielded from price risk, unlike Paprec's partial exposure to merchant risk. Luna and FCC MA benefit from low exposure to private industrial and commercial customers and benefit from higher geographical diversification. The stronger business profiles of Luna and FCC support their higher debt capacity than Paprec. However, Luna 's significantly higher leverage constrains its rating in the 'B' category. Fitch’s Key Rating-Case Assumptions - Total volumes of waste processed at 5% CAGR for 2025-2028 - Total volumes of raw materials recycled at 6% CAGR for 2025-2028 - Raw material prices to gradually decline to about EUR155/tonne by 2028 from EUR171/tonne in 2026 - Prices for waste services to increase at CAGR 3% during 2026-2028 - Average EBITDA (excluding IFRS16) margin of 11.5% for 2026-2028 - Total capex (excluding leases) of approx. EUR720 million for 2026-2028 - Additional M&A - beyond the transactions already closed - totalling about EUR350 million over 2026-2028, based on a 6.0x enterprise value/EBITDA multiple - Dividends paid increasing to EUR55 million in 2028 from EUR30 million in 2026 Corporate Rating Tool Inputs and Scores Fitch scored the issuer as follows, using its Corporate Rating Tool (CRT) to produce the Standalone Credit Profile (SCP): Business and financial profile factors (assessment, relative importance): management ('bbb-', Lower), sector characteristics ('bbb-', Moderate), market and competitive positioning ('bbb', Moderate), diversification and asset quality ('bbb-', Moderate), company operational characteristics ('bbb-', Moderate), profitability ('bb-', Higher), financial structure ('bb-', Higher), and financial flexibility ('bbb-', Moderate). The quantitative financial subfactors are based on custom CRT financial period parameters: 25% weight for the historical year 2025, 25% for the forecast year 2026, 25% for the forecast year 2027 and 25% for the forecast year 2028. The governance assessment of 'good' has no impact. The operating environment assessment of 'a+' has no impact. The SCP is 'bb'. To derive the Long-Term IDR: Fitch made no adjustments to the SCP, resulting in an IDR of 'BB'. RATING SENSITIVITIES Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade - EBITDA net leverage structurally above 3.9x - EBITDA interest coverage below 3.5x and consistently negative FCF - Deviations from the current financial policy to fund additional capex, acquisitions and dividends - Increasing margin volatility due to changes to the structure of contracts, especially regarding indexation to raw material price evolution Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade - EBITDA net leverage sustainably below 3.2x - EBITDA interest coverage above 4.5x - Improved profitability reflected in a sustained EBITDA margin above 12% - Positive FCF Liquidity and Debt Structure At end-2025, Paprec had EUR548 million of readily available cash and a recently upsized fully undrawn EUR400 million revolving credit facility maturing in April 2028. This is against its forecast of FCF outflow of about EUR334 million and EUR188 million of short-term debt liabilities due in 2026. Paprec's senior secured debt is rated one notch above the IDR, as bondholders benefit from collateral on a first-priority basis on the securities and pledges on bank accounts and intercompany financial receivables of Paprec's subsidiaries. Paprec and guarantors generated around 55% of the group's EBITDA at end-2025, which is lower than similar transactions' around 80%, yielding a Recovery Rating of 'RR3'. Issuer Profile Paprec is a majority family-owned waste recycling company in France. It has 369 waste sorting, processing and recycling sites, operates 28 energy from waste plants and 20 landfills in France, and recycled about 19 million tons of waste in 2025. 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. Climate Vulnerability Signals The results of its Climate.VS screener did not indicate an elevated risk for Paprec. 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 ----------- ------ -------- ----- Paprec Holding SA LT IDR BB Affirmed BB senior secured LT BB+ Affirmed RR3 BB+ ============= G E R M A N Y ============= HT TROPLAST: S&P Affirms 'B' ICR & Alters Outlook to Stable ----------------------------------------------------------- S&P Global Ratings revised the outlook to stable from negative on HT Troplast GmbH (Profine). S&P also affirmed its 'B' long-term issuer rating on Profine and assigned its 'B' issue-level rating on the new senior secured notes. The recovery rating is '3' (50%). The stable outlook reflects our view that Profine will improve its S&P Global Ratings-adjusted debt to EBITDA to below 5.5x in the next 12-18 months due to resilient EBITDA, a stable capital structure, and free operating cash flow (FOCF) generation turning positive. Profine plans to refinance its capital structure by raising EUR430 million of new senior secured notes and fully refinancing its EUR85 million super senior revolving credit facility (RCF). As part of the transaction, the company will repay its existing EUR380 million senior secured notes, repay the utilized portion of its existing RCF, and cover transaction and redemption fees. S&P said, "We expect operating performance will improve, with revenue growth of 6.8%-7.2% and S&P Global Ratings-adjusted EBITDA margin of 11.8%-12.5% in 2026. This has support from pricing initiatives and investments in growth projects. "While the proposed transaction will increase the gross debt by approximately EUR28 million, we expect S&P Global Ratings-adjusted debt to EBITDA will remain below our 5.5x downside threshold this year, with deleveraging thereafter. "We anticipate solid operating performance in 2026-2027 amid an uncertain market environment. We expect revenue to grow 6.8%-7.2% to EUR860 million-EUR900 million in 2026 as favorable price surcharges offset an only moderate recovery of volumes in core products. Furthermore, Profine is investing in key projects to grow across the U.S. and Turkey, expand its assembled products and aluminum segment, as well as launch its WarmCore hybrid system." Sales volume in Russia remains weaker, although the company sustains good profit. Additionally, the company quickly implemented material surcharges mechanism after the start of the war in the Middle East. The company has been effective in passing through additional costs with minimal time lag, implementing each round of surcharges within less than one month after raw material prices increased. After a weak start to 2026 due to adverse weather conditions, sales volumes began slightly picking up toward the end of first quarter through May, supporting moderate volume recovery for the full year. The company has made an effort not to accept sizable preorders to keep sales volumes balanced through the second half of the year and avoid concentrating sales in the first half. S&P said, "We expect EUR900 million-EUR940 million of revenue in 2027 and EUR950 million-EUR980 million in 2028 due mainly to contributions from Profine's growth projects. Additionally, its core business will likely grow due to expected market recovery from 2028 onwards. "We project S&P Global Ratings-adjusted EBITDA margin of 11.8%-12.5% in 2026 due to its growth projects and lower one-off costs related to these investments, improving from 11.1% in 2025. We expect margin to grow further to 11.8%-13.4% in 2027-2028. "S&P Global Ratings-adjusted debt to EBITDA will likely be below our 5.5x downside threshold this year following the refinancing. Profine issued new senior secured notes of about EUR430 million due in 2031. Proceeds and cash on balance sheet will repay the existing EUR380 million senior secured notes due in July 2028, redemption fees, and the EUR22 million drawn under the existing EUR85 million senior secured revolving credit facility due in January 2028. "We expect that S&P Global Ratings-adjusted leverage of 5.0x-5.5x in 2026, driven mainly by the upsized senior secured notes. We expect deleveraging to 4.8x-5.1x in 2027, as adjusted EBITDA improves due to the growth investments. The transaction will improve the group's financial debt maturity profile, with no major financial debt maturity before 2030, as well as reduce the annual cash interest expenses. "We expect FOCF to turn positive in 2026. We project EUR10 million-EUR12 million of FOCF, largely in line with our previous base case, as growth projects improve EBITDA. In 2025, FOCF was a deficit of EUR4 million due to investments for Profine's growth initiatives. We expect FOCF to improve further to about EUR20 million in 2027-2028. "However, FOCF after lease payments will remain broadly neutral in 2026, improving to EUR5 million-EUR7 million in 2027. We project annual lease principal payments of EUR12 million-EUR14 million." Liquidity will remain adequate in the next 12 months. The company had EUR23 million in pro forma cash on balance sheet at the time of the transaction launching. After refinancing, the EUR85 million revolving credit facility will be fully available for drawing. Although Profine gains a long-dated debt maturity profile following the proposed refinancing, covenant headroom remains relatively limited but improved after resetting the covenant threshold. The stable outlook reflects S&P's view that Profine will improve its S&P Global Ratings-adjusted debt to EBITDA to below 5.5x in the next 12-18 months due to resilient EBITDA, a stable capital structure, and free operating cash flow (FOCF) generation turning positive. S&P could revise the outlook to negative if: -- Profine's operating performance deteriorates without prospects for a swift recovery, keeping FOCF negative in 2026-2027, and pressuring liquidity; or -- The company pursues debt-funded acquisitions, capital investments, or shareholder distributions, sustaining S&P Global Ratings-adjusted debt to EBITDA higher than 5.5x. S&P could take a positive rating action if: -- Revenue and EBITDA margin improve beyond S&P's base-case scenario, such that the company generates material FOCF and shows a track record of maintaining S&P Global Ratings-adjusted debt below 4.0x through the business cycle; and -- Management and shareholders demonstrate a strong commitment to maintain credit metrics commensurate with a higher rating. PROTECT HOLDCO: Fitch Affirms 'B+' LongTerm IDR, Outlook Stable --------------------------------------------------------------- Fitch Ratings has affirmed Protect Holdco GmbH's (Uvex) Long-Term Issuer Default Rating (IDR) at 'B+' with Stable Outlook. Fitch has also affirmed Uvex's senior secured term loan B (TLB), issued by UVEX GROUP GmbH (previously Protect Bidco GmbH), at 'B+' and its Recovery Rating at 'RR4', following a EUR50 million term loan B (TLB) add-on. The affirmation reflects continuing small scale and geographic concentration in Germany, Austria and Switzerland. It also reflects improving operating margins, in line with Fitch's expectations, due to increase in volumes and a better product mix. The new TLB add-on will result in a 0.5x gross leverage increase at FYE26 (financial year to July 2026), with no impact on free cash flow (FCF), due to favourable repricing. Fitch expects strong revenue and EBITDA expansion to result in solid deleveraging capacity. However, the additional debt may reduce leverage headroom in the event of unexpected underperformance. Key Rating Drivers Strategic Actions Improve Profitability: Fitch expects profitability to continue improving over 2026-2029, supported by cost savings in the sports division, higher pricing from product premiumisation, and full integration of recent US acquisitions. Uvex's EBITDA margin improved to 10.6% in FY25 from 10.1% in FY24, slightly ahead of its expectations. The 9MFY26 results highlighted further gains, driven by revenue and cost-saving actions. FCF Improvement Expected: Uvex's FY25 Fitch-adjusted FCF was below expectations, due mainly to negative working capital movements, mostly driven by one-off payments. Fitch expects FCF to turn sustainably positive after FY26, as EBITDA growth provides a greater buffer against working-capital investment needs. Cash flow generation should also benefit from the group's low business capital intensity, with most growth capex already completed. Fitch believes its stronger cash flow generation capacity will absorb an expected rise in interest payment to about EUR30 million annually following its leveraged buyout in FY26. Marginal impact from TBL Add-on: Fitch expects UVEX's EUR50 million TLB add-on to only marginally affect leverage metrics. Fitch expects EBITDA leverage to rise to 5.4x at FYE26 (versus 4.9x), but to return sustainably below 5.0x from FY27 as profitability improves. Fitch also expects the new TLB to have broadly neutral FCF impact as the additional interest paid on TLB add-on will be largely offset by TLB repricing. Adequate Financial Policy: In Fitch´s view, the debt add-on is not materially changing the group's financial policy. Fitch expects Uvex´s strategy to remain largely geared towards organic growth with possible bolt-on acquisitions in complementary business lines without material impact on leverage. Liquidity should remain adequate, with an EUR100 million revolving credit facility (RCF) fully available after repayment using proceeds from the TLB add-on. Strong but Niche Market Position: Uvex has a leading position in personal protection equipment (PPE) in several European countries. Its portfolio serves a wide range of end-markets, including sports and military, each with distinct requirements. Its position is supported by strong customer recognition and reliable products, which are important in this market. However, Uvex is smaller than many higher-rated industrial peers. Improving Geographical Diversification: Geographic diversification has improved slightly, with revenue outside Germany rising to 62% from 60%, helped by the HexArmor acquisition, which strengthened the company's US presence. Uvex also has a broad PPE offering, although glove products remain a key concentration, especially in the US. Peer Analysis Uvex's business profile is comparable to Trench Group Holdings GmbH (BB-/Negative), INNIO NV (B+/Stable), and Dynamo Midco B.V. (B/Stable), with a leading market position in a niche segment, strong customer relationships, and a commitment to innovation. However, like Purmo Group Holdings Limited (B+/Stable), Uvex's smaller scale relative to other peers' weighs on its overall credit profile. The company's financial profile is similar to that of Purmo Group, with low double-digit EBITDA margins and leverage of about 5x. Both companies have a smaller scale than peers, but their leverage is lower than that of ams-OSRAM AG (B/Positive) and Ahlstrom Oy (B/Stable). Fitch’s Key Rating-Case Assumptions - Revenue CAGR of 5.8% in FY25-FY29, driven by US market and portfolio expansion and modest contribution from its BakNer acquisition - Fitch-adjusted EBITDA margin to gradually rise above 13% by end of decade on cost optimisation and improved fixed cost absorption - Average net working-capital needs of about 1% of sales during FY26-FY29 - Capex declining below 3% of revenue by FY29 on reduced expansionary investments - No M&A or dividends Corporate Rating Tool Inputs and Scores Fitch scored the issuer as follows, using its Corporate Rating Tool (CRT) to produce the Standalone Credit Profile (SCP): - Business and financial profile factors (assessment, relative importance): management ('bb', Lower), sector characteristics ('bbb-', Moderate), market and competitive positioning ('bb', Moderate), diversification and asset quality ('bb+', Moderate), company operational characteristics ('b+', Higher), profitability ('bbb', Moderate), financial structure ('b+', Higher), and financial flexibility ('bb+', Lower). - The quantitative financial subfactors are based on custom CRT financial period parameters: 10% weight for the forecast year FY26, 30% for the forecast year FY27, 30% for the forecast year FY28 and 30% for the forecast year FY29. - Weakest link considerations adjustment is applied, based on company operational characteristics factor and results in an adjustment of -1 notch. - B+ to CC considerations apply in its analysis and have no impact. - The governance assessment of 'some deficiencies' has no impact. - The operating environment assessment of 'a+' has no impact. - The SCP is 'b+'. - To derive the Long-Term IDR: Fitch made no adjustments to the SCP, resulting in an IDR of 'B+'. Recovery Analysis - The recovery analysis assumes that Uvex would be reorganised as a going concern (GC) in bankruptcy, rather than liquidated in a default. - Fitch assumes a 10% administrative claim. - Its GC EBITDA estimate of EUR50 million reflects Fitch's view of the group's high operating leverage partly offset by strong pricing and premium products. - Fitch applies a multiple of 5.5x to the GC EBITDA to calculate a post-reorganisation enterprise value, in line with the industry median and peers'. - The multiple of 5.5x reflects Uvex's business model as a premium producer of PPE equipment, covering a wide range of end-markets. It is further supported by its leading market position in the niche market and a strong customer base. - The total enterprise value available for claims is EUR248 million. - The waterfall analysis is based on the proposed capital structure, which consists of EUR12 million of senior real estate debt, a EUR100 million RCF and a EUR450 million TLB (including the add-on). Both the RCF and TLB rank pari passu with each other. Its waterfall analysis generated a ranked recovery in the 'RR4' band, indicating a 'B+' rating for the EUR450 million TLB. RATING SENSITIVITIES Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade - EBITDA margin consistently below 11% - EBITDA interest coverage below 3x on a sustained basis - FCF margin below 1% for an extended period - EBITDA leverage above 5x on a sustained basis Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade - EBITDA margin above 13% on a sustained basis - EBITDA interest coverage consistently above 4x - Revenue above EUR1 billion, with improved geographical diversification - FCF margin above 3% for an extended period - EBITDA leverage below 4x on a sustained basis Liquidity and Debt Structure Uvex's reported available cash will increase to EUR71 million after the TLB add-on as the transaction will result in cash overfunding of about EUR35 million. Fitch considers about EUR20 million of the reported cash to be not immediately available for debt repayment as it will be restricted for intra-year net working capital swings. Uvex plans also to use part of TLB proceeds to repay the RCF drawdowns and restore the credit line full availability to EUR100 million. UVEX's financial debt pro-forma for the TLB add-on includes the original TLB raised from the LBO of EUR400 million, the add-on of EUR50 million and additional real estate debt of EUR12 million. Issuer Profile Uvex, founded in 1926, is a global leader of premium and innovative head-to-toe safety equipment for people at work, as well as in sports and leisure with a strong market reputation. 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. Climate Vulnerability Signals The results of its Climate.VS screener did not indicate an elevated risk for UVEX. 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 ----------- ------ -------- ----- UVEX GROUP GmbH senior secured LT B+ Affirmed RR4 B+ Protect Holdco GmbH LT IDR B+ Affirmed B+ =========== G R E E C E =========== PUBLIC POWER: S&P Raises LT ICR to 'BB' on Accelerated Growth ------------------------------------------------------------- S&P Global Ratings revised upward its stand-alone credit profile (SACP) assessment for Greek integrated utility Public Power Corp. S.A. to 'bb-' from 'b+' and raised its long-term issuer credit and issue ratings to 'BB' from 'BB-'. The '3' recovery rating on its senior debt is unchanged, indicating its expectation of meaningful (rounded estimate: 65%) recovery prospects in a default scenario. The stable outlook reflects S&P's expectation that PPC will successfully implement its growth plan while maintaining FFO to debt sustainably above 15% over 2026-2028. S&P also expects the company to fully exit lignite-powered generation by the end of 2026. Public Power Corp. (PPC) recently updated its 2026-2028 strategic plan, extending it until 2030 and accelerating investments to EUR24 billion. The company will now invest about EUR5 billion per year mostly on renewables, data centers, and networks in Southeastern Europe (SEE), versus about EUR3.5 billion per year in the previous plan. The plan is being partly financed by a EUR4.25 billion capital increase plus EUR250 million of treasury shares placed, completed on May 22, 2026, helping to contain the 2026-2028 adjusted debt increase to about EUR4 billion. S&P therefore expects PPC to maintain funds from operations (FFO) to debt above 15% over 2026-2028, gradually improving toward 17%-20% by 2030. PPC's 2026-2030 strategic plan targets faster earnings growth and a stronger presence in the SEE region. PPC's updated 2026-2030 strategic plan reflects a significant increase in growth ambitions compared with the 2026-2028 plan announced in November 2025. The company has increased planned capital expenditure (capex) to about EUR24 billion over 2026-2030 from about EUR10 billion previously planned for 2026-2028, supported by increasing power demand, decommissioning of fossil fuel generation, and an improving macroeconomic outlook in the SEE region. The company will now invest about EUR5 billion per year, mostly on renewables, data centers, and networks in SEE, versus about EUR3.5 billion per year in the previous plan. PPC aims to almost double generation capacity compared with 2025 to reach 24.3 gigawatts (GW) by 2030, through investments in renewables, storage, flexible generation, data centers, and expansion into new markets (PPC will be entering Hungary, Poland, and Slovakia). Renewable energy will account for about 53% of capex, while investments in distribution networks for about 19% of capex, mitigating the dilution of the earnings contribution from regulated activities. The company says it is on track to fully exit lignite generation by the end of 2026. S&P said, "We believe the larger scale and more diversified geographic footprint could strengthen the company's business risk profile in due course. In our previous report, we stated that PPC's business risk profile was improving following its strategic shift to renewables and regulated operations. We now expect this improvement to materialize more quickly, as PPC's S&P Global Ratings-adjusted EBITDA is set to increase materially to about EUR3.2billion-EUR3.4 billion in 2028 from EUR2 billion in 2025, supported by a larger asset base." This is 10%-20% above our previous projection of EUR2.9 billion. A more robust domestic economy, PPC's entry into new markets in the region, as well as data center demand will drive growth for the company, whose integrated business model supports earnings through volatile wholesale prices. The completed EUR4.5 billion capital increase (including placing EUR250 million of treasury shares) alleviates pressure on credit metrics. In addition to the ambitious capex program, PPC will double its dividends per share to EUR1.2 per share in 2028 from EUR0.6 per share in 2025. S&P said, "Despite the material projected cash outflows (capex and dividends), we view the funding structure of the plan as supportive. The recently completed EUR4.5 billion capital increase halves the debt increase over 2026-2028. Management also expects a large share of investments to be financed through internally generated cash flows and the remainder with incremental debt (about EUR8 billion over 2026-2030). We therefore expect material negative discretionary cash flow during the first three years of the plan, when investments will be highest and earnings will have only started to grow. Consequently, S&P Global Ratings-adjusted debt will increase to about EUR14 billion by 2028 from EUR9 billion in 2025. Nevertheless, we do not expect leverage to exceed the company's public net leverage ceiling of 3.5x (equivalent to about 5.0x on our adjusted basis), and we project our FFO to debt to remain above 15% over the same period." S&P said, "Our rating on PPC continues to benefit from one notch of uplift, reflecting the moderate likelihood of extraordinary government support from 33.4% shareholder, the Greek state. Within the external EUR4.25 billion capital increase, PPC secured EUR1.3 billion from the Greek state, which maintained its 33.4% controlling stake in the company. We expect PPC to continue to maintain its moderate likelihood of extraordinary support from the Greek government. We note the existing minority shareholder CVC has also injected EUR1.2 billion of capital, increasing its stake in PPC from 10.3% currently to 17.2%. We understand that CVC's capital contribution in PPC is pure equity. "The stable outlook reflects our expectation that PPC will successfully implement its growth plan, while maintaining FFO to debt sustainably above 15% over 2026-2028. We also expect the company to fully exit lignite-powered generation by the end of 2026. "We project that PPC will report adjusted EBITDA of about EUR2.4 billion-EUR2.5 billion in 2026 and EUR2.5 billion-EUR2.7 billion in 2027. "We could lower the rating if the implementation of the growth strategy is delayed materially or if FFO to debt falls below 15%." A one-notch downgrade of Greece to 'BBB-' would not impact our rating on PPC. S&P could revise upward the SACP to 'bb' if: -- PPC's business risk profile improves, mainly due to the successful implementation of the strategic plan leading to EBITDA and renewables capacity growth, and assuming the full closure of lignite plants; or -- FFO to debt remains above 17%. This could be demonstrated by PPC's renewable capacity increasing at an average pace of 2.3 GW per year to reach 15 GW and S&P Global Ratings-adjusted EBITDA exceeds EUR3 billion by 2028. An upgrade of Greece to 'BBB+' would not impact S&P's rating on PPC. ============= I R E L A N D ============= ARES EUROPEAN XIX: S&P Assigns B-(sf) Rating on Class F Notes ------------------------------------------------------------- S&P Global Ratings assigned credit ratings to Ares European CLO XIX DAC's class A-R, B-R, C-R, D-R, and E-R notes. At the same time, S&P affirmed its rating on the existing class F notes and withdrew its ratings on the existing class A, B, C, D, and E notes. At closing, the issuer had unrated subordinated notes outstanding from the existing transaction. On June 18, 2026, Ares European CLO XIX DAC's refinanced the existing class A, B, C, D, and E notes (originally issued in June 2024) through an optional redemption and issued replacement notes of the same notional. The replacement notes are largely subject to the same terms and conditions as the original notes, except that the replacement notes will have a lower spread over Euro Interbank Offered Rate (EURIBOR) than the original notes. The ratings reflect S&P's assessment of: -- The diversified collateral pool, which primarily comprises broadly syndicated speculative-grade senior secured term loans and bonds that are governed by collateral quality tests. -- The credit enhancement provided through the subordination of cash flows, excess spread, and overcollateralization. -- The collateral manager's experienced team, which can affect the performance of the rated notes through collateral selection, ongoing portfolio management, and trading. -- The transaction's legal structure, which is bankruptcy remote. -- The transaction's counterparty risks, which are in line with S&P's counterparty rating framework. Portfolio benchmarks S&P Global Ratings' weighted-average rating factor 2,863.43 Default rate dispersion 390.44 Weighted-average life (years) 4.24 Obligor diversity measure 178.92 Industry diversity measure 25.26 Regional diversity measure 1.24 Transaction key metrics Portfolio weighted-average rating derived from S&P's CDO evaluator B 'CCC' category rated assets (%) 1.03 Actual target 'AAA' weighted-average recovery (%) 36.41 Actual target weighted-average spread (net of floors; %) 3.61 Actual target weighted-average coupon 4.82 Rating rationale Under the transaction documents, the rated notes will pay quarterly interest unless a frequency switch event occurs. Following this, the notes will switch to semiannual payments. The portfolio's reinvestment period will end on Jan. 15, 2029. The portfolio is well-diversified at closing, primarily comprising broadly syndicated speculative-grade senior secured term loans and senior secured bonds. Therefore, S&P has conducted its credit and cash flow analysis by applying its criteria for corporate cash flow CDOs. S&P said, "In our cash flow analysis, we used an adjusted target par amount of EUR424.30 million, derived by deducting negative cash and the defaulted balance from the aggregate principal balance, then adding the recovery value. This is lower than the EUR425 million target. We used the portfolio's actual weighted-average spread (3.61%), the reference weighted average fixed coupon (4.82%), and the actual portfolio weighted-average recovery rates for all rated notes. "We applied various cash flow stress scenarios, using four different default patterns, in conjunction with interest rate stress scenarios for each liability rating category. "The transaction's documented counterparty replacement and remedy mechanisms adequately mitigate its exposure to counterparty risk under our counterparty criteria. "Under our structured finance sovereign risk criteria, the transaction's exposure to country risk is sufficiently mitigated at the assigned ratings. "The transaction's legal structure and framework is bankruptcy remote, in line with our legal criteria. "Our credit and cash flow analysis indicates the available credit enhancement for the class B-R, C-R, D-R, and E-R notes could withstand stresses commensurate with higher ratings than those assigned. However, as the CLO is still in its reinvestment phase, during which the transaction's credit risk profile could deteriorate, we capped our assigned ratings on these refinanced notes. "Our credit and cash flow analysis indicates the available credit enhancement for the class B, C, D, and E notes could withstand stresses commensurate with the assigned ratings. "For the class F notes, our credit and cash flow analysis indicates that the available credit enhancement could withstand stresses commensurate with a lower rating. However, we have applied our 'CCC' rating criteria, resulting in a 'B- (sf)' rating on this class of notes." The rating uplift for the class F notes reflects several key factors, including: -- The class F notes' available credit enhancement, which is in the same range as that of other CLOs S&P has rated and that has recently been issued in Europe. -- The portfolio's average credit quality, which is similar to other recent CLOs. -- S&P's model generated BDR at the 'B-' rating level of 20.20% (for a portfolio with a weighted-average life of 4.24 years), versus if S&P has to consider a long-term sustainable default rate of 3.2% for 4.24 years, which would result in a target default rate of 13.568%. -- S&P does not believe that there is a one-in-two chance of this note defaulting. -- S&P does not envision this tranche defaulting in the next 12-18 months. S&P said, "Following this analysis, we consider that the available credit enhancement for the class F notes is commensurate with the assigned 'B- (sf)' rating. "Following our analysis of credit, cash flow, counterparty, operational, and legal risks, we believe our ratings are commensurate with the available credit enhancement for the class A-R, B-R, C-R, D-R, E-R, and F notes. "In addition to our standard analysis, to provide an indication of how rising pressures among speculative-grade corporates could affect our ratings on European CLO transactions, we have also included the sensitivity of the ratings on the class A-R to E-R notes based on four hypothetical scenarios." Environmental, social, and governance S&P said, "We regard the exposure to environmental, social, and governance (ESG) credit factors in the transaction as being broadly in line with our benchmark for the sector. Primarily due to the diversity of the assets within CLOs, the exposure to environmental credit factors is viewed as below average, social credit factors are below average, and governance credit factors are average. For this transaction, the documents prohibit or limit assets from being related to certain industries. Since the exclusion of assets from these industries does not result in material differences between the transaction and our ESG benchmark for the sector, no specific adjustments have been made in our rating analysis to account for any ESG-related risks or opportunities." Ratings assigned Replacement Original Notes notes Amount interest interest Credit Class Rating* (mil. EUR) rate§ rate† enhancement (%) A-R AAA (sf) 259.20 Three-month Three-month EURIBOR EURIBOR + 1.20% + 1.47% 38.91 B-R AA (sf) 53.20 Three-month Three-month EURIBOR EURIBOR + 1.75% + 2.10% 26.37 C-R A (sf) 23.40 Three-month Three-month EURIBOR EURIBOR + 2.00% + 2.65% 20.86 D-R BBB- (sf) 29.80 Three-month Three-month EURIBOR EURIBOR + 3.10% + 3.75% 13.84 E-R BB- (sf) 20.10 Three-month Three-month EURIBOR EURIBOR + 5.20% + 6.79% 9.10 Rating affirmed Class Rating* Amount (mil. EUR) Notes interest rate § F B- (sf) 11.70 Three-month EURIBOR + 8.59% *The ratings on the class A-R and B-R notes address timely interest and ultimate principal payments. The ratings on the class C-R, D-R, E-R, and F notes address ultimate interest and principal payments. §The payment frequency switches to semiannual and the index switches to six-month EURIBOR when a frequency switch event occurs. EURIBOR--Euro Interbank Offered Rate. CANYON EURO CLO 2026-1: S&P Assigns B-(sf) Rating on Cl. F Notes ---------------------------------------------------------------- S&P Global Ratings assigned its credit ratings to Canyon Euro CLO 2026-1 DAC's class A-1 and A-2 Loans and class A, B, C, D, E, and F notes. At closing, the issuer also issued EUR41.90 million unrated subordinated notes and EUR10 million unrated class Z notes. The reinvestment period will be approximately 4.7 years, while the noncall period will be 1.5 years after closing. Under the transaction documents, the rated notes and loans will pay quarterly interest unless there is a frequency switch event. Following this, the notes and loans will switch to semiannual payment. The ratings assigned to the notes and loans reflect S&P's assessment of: -- The diversified collateral pool, which primarily comprises broadly syndicated speculative-grade senior secured term loans and bonds that are governed by collateral quality tests. -- The credit enhancement provided through the subordination of cash flows, excess spread, and overcollateralization. -- The collateral manager's experienced team, which can affect the performance of the rated notes and loans through collateral selection, ongoing portfolio management, and trading. -- The transaction's legal structure, which is bankruptcy remote. -- The transaction's counterparty risks, which are in line with S&P's counterparty rating framework. Portfolio benchmarks S&P Global Ratings' weighted-average rating factor 2,765.65 Default rate dispersion 509.80 Weighted-average life (years) 4.79 Obligor diversity measure 154.02 Industry diversity measure 23.05 Regional diversity measure 1.26 Transaction key metrics Total par amount (mil. EUR) 400 Defaulted assets (mil. EUR) 0 Number of performing obligors 185 Portfolio weighted-average rating derived from S&P's CDO evaluator B 'CCC' category rated assets (%) 1.25 Target 'AAA' weighted-average recovery (%) 36.61 Actual weighted-average spread net of floors (%) 3.49 Covenanted weighted-average coupon (%) 4.83 Rationale S&P's ratings reflect our assessment of the collateral portfolio's credit quality, which has a weighted-average rating of 'B'. S&P said, "The portfolio is well-diversified, primarily comprising broadly syndicated speculative-grade senior secured term loans and bonds. Therefore, we conducted our credit and cash flow analysis by applying our criteria for corporate cash flow CDOs. "In our cash flow analysis, we used the EUR400 million target par amount, the target weighted-average spread of 3.49%, the target weighted-average coupon of 4.83%, and the target weighted-average recovery rate. We applied various cash flow stress scenarios, using four different default patterns, in conjunction with different interest rate stress scenarios for each liability rating category. "The transaction's documented counterparty replacement and remedy mechanisms adequately mitigate its exposure to counterparty risk under our current counterparty criteria. "Under our structured finance sovereign risk criteria, the transaction's exposure to country risk is sufficiently mitigated at the assigned ratings. "The transaction's legal structure and framework is bankruptcy remote, in line with our legal criteria. "Our credit and cash flow analysis indicates that the available credit enhancement for the class B, C, D, and E notes could withstand stresses commensurate with higher ratings than those assigned. However, as the CLO will be in its reinvestment phase starting from the effective date, during which the transaction's credit risk profile could deteriorate, we have capped our ratings assigned to the notes." The class A-1 and A-2 Loans could withstand stresses commensurate with the assigned ratings. The class F notes' current break-even default rate cushion is negative at the assigned rating. S&P said, "Nevertheless, based on the portfolio's actual characteristics and additional overlaying factors, including our long-term corporate default rates and recent economic outlook, we believe this class is able to sustain a steady-state scenario, in accordance with our criteria. S&P's analysis further reflects several factors, including: -- The class F notes' available credit enhancement, which is in the same range as that of other CLOs S&P has rated and that has recently been issued in Europe. -- S&P's model-generated portfolio default risk, which is at the 'B-' rating level at 24.33% (for a portfolio with a weighted-average life of 4.79 years) versus 15.33% if it was to consider a long-term sustainable default rate of 3.2% for 4.79 years. -- Whether the tranche is vulnerable to nonpayment in the near future. -- If there is a one-in-two chance for this note to default. -- If S&P envisions this tranche to default in the next 12-18 months. S&P said, "Following this analysis, we consider that the available credit enhancement for the class F notes is commensurate with the assigned 'B- (sf)' rating. "Following our analysis of the credit, cash flow, counterparty, operational, and legal risks, we believe that our ratings are commensurate with the available credit enhancement for all rated classes of notes and loans. "In addition to our standard analysis, we have also included the sensitivity of the ratings on the class A to E notes, based on four hypothetical scenarios. "As our ratings analysis makes additional considerations before assigning ratings in the 'CCC' category, and we would assign a 'B-' rating if the criteria for assigning a 'CCC' category rating are not met, we have not included the above scenario analysis results for the class F notes delayed draw." Environmental, social, and governance S&P regards the exposure to environmental, social, and governance (ESG) credit factors in the transaction as being broadly in line with our benchmark for the sector. Primarily due to the diversity of the assets within CLOs, the exposure to environmental credit factors is viewed as below average, social credit factors are below average, and governance credit factors are average. For this transaction, the documents prohibit assets from being related to certain activities. Accordingly, since the exclusion of assets from these industries does not result in material differences between the transaction and S&P's ESG benchmark for the sector, no specific adjustments have been made in its rating analysis to account for any ESG-related risks or opportunities. Canyon Euro CLO 2026-1 DAC is a European cash flow CLO securitization of a revolving pool, comprising euro-denominated senior secured loans and bonds issued mainly by speculative-grade borrowers. Canyon CLO Advisors L.P. manages the transaction. Ratings Amount Credit Class Rating* (mil. EUR) enhancement (%) Interest rate A AAA (sf) 110.00 38.00 Three/six-month EURIBOR plus 1.30% A-1 Loan AAA (sf) 88.00 38.00 Three/six-month EURIBOR plus 1.30% A-2 Loan AAA (sf) 50.00 38.00 Three/six-month EURIBOR plus 1.30% B AA (sf) 44.00 27.00 Three/six-month EURIBOR plus 2.00% C A (sf) 23.00 21.25 Three/six-month EURIBOR plus 2.30% D BBB- (sf) 29.00 14.00 Three/six-month EURIBOR plus 3.35% E BB- (sf) 17.00 9.75 Three/six-month EURIBOR plus 5.60% F B- (sf) 13.00 6.50 Three/six-month EURIBOR plus 8.60% Z NR 10.00 N/A N/A Sub notes NR 41.90 N/A N/A *The ratings assigned to the class A notes, and class A-1 and A-2 Loans address timely interest and ultimate principal payments. S&P's ratings address ultimate interest and principal payments on the remaining rated notes. The payment frequency switches to semiannual, and the index switches to six-month EURIBOR when a frequency switch event occurs. EURIBOR--Euro Interbank Offered Rate. NR--Not rated. N/A--Not applicable. CAPITAL FOUR XII: S&P Assigns B-(sf) Rating on Class F Notes ------------------------------------------------------------ S&P Global Ratings assigned its credit ratings to Capital Four CLO XII DAC's class A, B, C, D, E, and F notes. At closing, the issuer also issued EUR33.400 million unrated subordinated notes. The reinvestment period will be approximately 4.5 years, while the noncall period will be 1.5 years after closing. Under the transaction documents, the rated notes will pay quarterly interest unless there is a frequency switch event. Following this, the notes will switch to semiannual payment. The ratings assigned to the notes reflect S&P's assessment of: -- The diversified collateral pool, which primarily comprises broadly syndicated speculative-grade senior secured term loans and bonds that are governed by collateral quality tests. -- The credit enhancement provided through the subordination of cash flows, excess spread, and overcollateralization. -- The collateral manager's experienced team, which can affect the performance of the rated notes through collateral selection, ongoing portfolio management, and trading. -- The transaction's legal structure, which is bankruptcy remote. -- The transaction's counterparty risks, which are in line with S&P's counterparty rating framework. Portfolio benchmarks S&P Global Ratings' weighted-average rating factor 2,885.53 Default rate dispersion 370.73 Weighted-average life (years) 4.90 Obligor diversity measure 128.58 Industry diversity measure 24.62 Regional diversity measure 1.26 Transaction key metrics Total par amount (mil. EUR) 450 Defaulted assets (mil. EUR) 0 Number of performing obligors 146 Portfolio weighted-average rating derived from S&P's CDO evaluator B 'CCC' category rated assets (%) 0.40 Target 'AAA' weighted-average recovery (%) 36.28 Actual weighted-average spread net of floors (%) 3.54 Actual weighted-average coupon (%) 4.83 Rationale S&P said, "Our ratings reflect our assessment of the collateral portfolio's credit quality, which has a weighted-average rating of 'B'. "The portfolio is well diversified, primarily comprising broadly syndicated speculative-grade senior secured term loans and bonds. Therefore, we conducted our credit and cash flow analysis by applying our criteria for corporate cash flow CDOs. "In our cash flow analysis, we used the EUR450.0 million target par amount, the covenanted weighted-average spread of 3.40%, the covenanted weighted-average coupon of 4.00%, and the covenanted weighted-average recovery rate at the 'AAA' level. We applied various cash flow stress scenarios, using four different default patterns, in conjunction with different interest rate stress scenarios for each liability rating category. "The transaction's documented counterparty replacement and remedy mechanisms adequately mitigate its exposure to counterparty risk under our current counterparty criteria. "Under our structured finance sovereign risk criteria, the transaction's exposure to country risk is sufficiently mitigated at the assigned ratings. "The transaction's legal structure and framework is bankruptcy remote, in line with our legal criteria. "Our credit and cash flow analysis indicates that the available credit enhancement for the class B, C, D, and E notes could withstand stresses commensurate with higher ratings than those assigned. However, as the CLO will be in its reinvestment phase starting from the effective date, during which the transaction's credit risk profile could deteriorate, we have capped our ratings assigned to the notes." The class A notes can withstand stresses commensurate with the assigned ratings. The class F notes' current break-even default rate cushion is negative at the assigned rating. S&P said, "Nevertheless, based on the portfolio's actual characteristics and additional overlaying factors, including our long-term corporate default rates and recent economic outlook, we believe this class is able to sustain a steady-state scenario, in accordance with our criteria." S&P's analysis further reflects several factors, including: -- The class F notes' available credit enhancement, which is in the same range as that of other CLOs we have rated and that have recently been issued in Europe. -- Our model-generated portfolio default risk, which is at the 'B-' rating level at 24.69% (for a portfolio with a weighted-average life of 4.90 years) versus 15.68% if we were to consider a long-term sustainable default rate of 3.2% for 4.90 years. -- Whether the tranche is vulnerable to nonpayment in the near future. -- If there is a one-in-two chance for this note to default. -- If S&P envisions this tranche to default in the next 12-18 months. S&P said, "Following this analysis, we consider that the available credit enhancement for the class F notes is commensurate with the assigned 'B- (sf)' rating. "Following our analysis of the credit, cash flow, counterparty, operational, and legal risks, we believe that our ratings are commensurate with the available credit enhancement for all rated classes of notes. "In addition to our standard analysis, we have also included the sensitivity of the ratings on the class A to E notes, based on four hypothetical scenarios. "As our ratings analysis makes additional considerations before assigning ratings in the 'CCC' category, and we would assign a 'B-' rating if the criteria for assigning a 'CCC' category rating are not met, we have not included the above scenario analysis results for the class F notes." Environmental, social, and governance S&P said, "We regard the exposure to environmental, social, and governance (ESG) credit factors in the transaction as being broadly in line with our benchmark for the sector. "Primarily due to the diversity of the assets within CLOs, the exposure to environmental credit factors is viewed as below average, social credit factors are below average, and governance credit factors are average. "For this transaction, the documents prohibit assets from being related to certain activities. Accordingly, since the exclusion of assets from these industries does not result in material differences between the transaction and our ESG benchmark for the sector, no specific adjustments have been made in our rating analysis to account for any ESG-related risks or opportunities." Capital Four CLO XII DAC is a European cash flow CLO securitization of a revolving pool, comprising euro-denominated senior secured loans and bonds issued mainly by speculative-grade borrowers. Capital Four AIFM A/S manages the transaction. Ratings Amount Credit Class Rating* (mil. EUR) enhancement (%) Interest rate A AAA (sf) 279.000 38.00 Three/six-month EURIBOR plus 1.28% B AA (sf) 47.250 27.50 Three/six-month EURIBOR plus 1.75% C A (sf) 27.000 21.50 Three/six-month EURIBOR plus 2.05% D BBB- (sf) 32.625 14.25 Three/six-month EURIBOR plus 3.00% E BB- (sf) 20.250 9.75 Three/six-month EURIBOR plus 5.25% F B- (sf) 14.625 6.50 Three/six-month EURIBOR plus 8.65% Sub notes NR 33.400 N/A N/A *The ratings assigned to the class A and B notes address timely interest and ultimate principal payments. S&P's ratings address ultimate interest and principal payments on the rest of the other rated notes. The payment frequency switches to semiannual, and the index switches to six-month EURIBOR when a frequency switch event occurs. EURIBOR--Euro Interbank Offered Rate. NR--Not rated. N/A--Not applicable. CVC CORDATUS XXXI: Fitch Affirms B-sf Final Rating on Cl. F-2 Notes ------------------------------------------------------------------- Fitch Ratings has assigned CVC Cordatus Loan Fund XXXI DAC refinancing notes a final rating, upgraded the class C-R notes and affirmed the remaining notes, as detailed below. Entity/Debt Rating Prior ----------- ------ ----- CVC Cordatus Loan Fund XXXI DAC A XS2801951117 LT PIFsf Paid In Full AAAsf A-R XS3400973197 LT AAAsf New Rating B-1R XS3298725485 LT AAsf Affirmed AAsf B-2R XS3298725998 LT AAsf Affirmed AAsf C-R XS3298726459 LT A+sf Upgrade Asf D-R XS3298726707 LT BBB-sf Affirmed BBB-sf E-R XS3298726962 LT BB-sf Affirmed BB-sf F-1R XS3298727184 LT B+sf Affirmed B+sf F-2 XS2801952941 LT B-sf Affirmed B-sf Transaction Summary CVC Cordatus Loan Fund XXXI DAC is a securitisation of mainly (at least 96%) senior secured obligations with a component of senior unsecured, mezzanine, second lien loans and high-yield bonds. Net proceeds from the refinancing notes have been used to redeem the class A notes. The collateralised loan obligation has 2.5 years remaining in the reinvestment period and a 6.5-year weighted average life (WAL) test covenant. KEY RATING DRIVERS Average Portfolio Credit Quality (Neutral): Fitch assesses the average credit quality of obligors at 'B'. The Fitch weighted average rating factor (WARF) of the identified portfolio is 23.9. High Recovery Expectations (Positive): At least 96% of the portfolio comprises senior secured obligations. Fitch views the recovery prospects for these assets as more favourable than those for second-lien, unsecured and mezzanine assets. The Fitch weighted average recovery rate (of the identified portfolio is 63.6%. Diversified Portfolio (Positive): The transaction includes various concentration limits in the portfolio, including a maximum fixed-rate obligation limit at 12.5%, a top 10 obligor concentration limit at 20% 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. Matrix Update (Neutral): The original matrices were updated in connection with this refinancing, so that only one matrix remains effective, corresponding to a top 10 obligor concentration of 20%, a weighted average life of 6.5 years and a fixed-rate asset limit of 12.5%. The transaction is within its reinvestment period, which expires in December 2028, 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 for the transaction's Fitch-stressed portfolio and matrix analysis is six months less than the WAL covenant. This is to account for the strict reinvestment conditions envisaged by the transaction after its reinvestment period, which include passing the coverage tests, the Fitch WARF test and the Fitch 'CCC' bucket limitation test and a WAL covenant that progressively steps down, before and after the end of the reinvestment period. Fitch believes these conditions would reduce the effective risk horizon of the portfolio during stress periods. Its analysis also considered that the transaction is about 0.7% below the target par of EUR440 million. Stable Performance (Positive): The transaction performance is stable with a marginal par shortfall equal to 0.7%, according to the 11 May 2026 report. Exposure to assets with a Fitch-derived rating of 'CCC+' and below is 3.3% versus a limit of 7.5%, and the portfolio has no exposure to defaulted assets. RATING SENSITIVITIES Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade A 25% increase in the mean default rate (RDR) and a 25% decrease in the recovery rate (RRR) across all ratings of the identified portfolio would have no impact on the class A-R to E-R notes and would lead to downgrades of no more than one notch to the class F-1-R notes and below 'B-sf' for the class F-2 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 defaults and portfolio deterioration. The rated notes have a rating cushion of up to five notches, due to the better metrics of the identified portfolio than the Fitch-stressed portfolio. Should the cushion between the identified and the Fitch-stressed portfolio erode due to manager trading or negative portfolio credit migration, a 25% increase of the mean RDR and a 25% decrease of the RRR across all ratings of the Fitch-stressed portfolio would result in downgrades of up to three notches for the class E-R notes, two notches each for the class A-R to D-R notes and to below 'B-sf' for the class F-1-R and F-2 notes. Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade A 25% reduction in the mean RDR and a 25% increase in the RRR across all ratings of the Fitch-stressed portfolios would lead to upgrades of up to five 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 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 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 CVC Cordatus Loan Fund XXXI 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. FERNHILL PARK: S&P Assigns B-(sf) Rating on Class F-R Notes ----------------------------------------------------------- S&P Global Ratings assigned credit ratings to Fernhill Park CLO DAC's A-R loan and class X-R, A-R, B-R, C-R, D-R, E-R, and F-R notes. At closing, the issuer had EUR36.6 million unrated subordinated notes outstanding from the existing transaction, and also issued EUR7.25 million unrated subordinated notes. This transaction is a reset of the already existing transaction which S&P rates. The existing classes of notes were fully redeemed with the proceeds from the issuance of the replacement notes on the reset date. The ratings on the original notes have been withdrawn. The reinvestment period will be approximately 4.5 years, while the noncall period will be 1.5 years after closing. Under the transaction documents, the rated notes and loan will pay quarterly interest unless a frequency switch event occurs. Following this, the notes and loan will switch to semiannual payment. The ratings assigned to the notes and loan reflect S&P's assessment of: -- The diversified collateral pool, which primarily comprises broadly syndicated speculative-grade senior secured term loans and bonds that are governed by collateral quality tests. -- The credit enhancement provided through the subordination of cash flows, excess spread, and overcollateralization. -- The collateral manager's experienced team, which can affect the performance of the rated notes and loan through collateral selection, ongoing portfolio management, and trading. -- The transaction's legal structure, which is bankruptcy remote. -- The transaction's counterparty risks, which are in line with S&P's counterparty rating framework. Portfolio benchmarks S&P Global Ratings' weighted-average rating factor 2,819.82 Default rate dispersion 556.75 Weighted-average life (years) 4.55 Obligor diversity measure 189.61 Industry diversity measure 22.72 Regional diversity measure 1.33 Transaction key metrics Total par amount (mil. EUR) 502 Defaulted assets (mil. EUR) 0 Number of performing obligors 240 Portfolio weighted-average rating derived from S&P's CDO evaluator B 'CCC' category rated assets (%) 3.59 Target 'AAA' weighted-average recovery (%) 36.90% Actual weighted-average spread net of floors (%) 3.50 Actual weighted-average coupon (%) 5.13 Rating rationale S&P said, "Our ratings reflect our assessment of the collateral portfolio's credit quality, which has a weighted-average rating of 'B'. "The portfolio is well-diversified, primarily comprising broadly syndicated speculative-grade senior secured term loans and bonds. Therefore, we conducted our credit and cash flow analysis by applying our criteria for corporate cash flow CDOs. "In our cash flow analysis, we used the EUR500 million target par amount, the covenanted weighted-average spread of 3.35%, the covenanted weighted-average coupon of 4.10%, and the actual weighted-average recovery rate. We applied various cash flow stress scenarios, using four different default patterns, in conjunction with different interest rate stress scenarios for each liability rating category. "The transaction's documented counterparty replacement and remedy mechanisms adequately mitigate its exposure to counterparty risk under our current counterparty criteria. "Under our structured finance sovereign risk criteria, the transaction's exposure to country risk is sufficiently mitigated at the assigned ratings. "The transaction's legal structure and framework is bankruptcy remote, in line with our legal criteria. "Our credit and cash flow analysis indicates that the available credit enhancement for the class B-R to D-R notes could withstand stresses commensurate with higher ratings than those assigned. However, as the CLO will be in its reinvestment phase starting from the effective date, during which the transaction's credit risk profile could deteriorate, we capped our ratings assigned to these notes." The class A-R loan and class X-R, A-R, and E-R notes can withstand stresses commensurate with the assigned ratings. The class F-R notes' current break-even default rate cushion is negative at the assigned rating. S&P said, "Nevertheless, based on the portfolio's actual characteristics and additional overlaying factors, including our long-term corporate default rates and recent economic outlook, S&P believes this class is able to sustain a steady-state scenario, in accordance with its 'CCC' ratings criteria." S&P's analysis further reflects several factors, including: -- The class F-R notes' available credit enhancement, which is similar to other CLOs S&P has rated and that has recently been issued in Europe. -- S&P's model-generated portfolio default risk, which is at the 'B-' rating level at 24.74% (for a portfolio with a weighted-average life of 4.55 years) versus 14.56% if it was to consider a long-term sustainable default rate of 3.2% for 4.55 years. -- Whether the tranche is vulnerable to nonpayment in the near future. -- If there is a one-in-two chance of this tranche defaulting. -- If S&P envisions this tranche to default in the next 12-18 months. S&P said, "Following this analysis, we consider that the available credit enhancement for the class F-R notes is commensurate with the assigned 'B- (sf)' rating. "Based on our analysis of credit, cash flow, counterparty, operational, and legal risks, we believe that our ratings are commensurate with the available credit enhancement for all rated classes of notes and loan. "In addition to our standard analysis, we also included the sensitivity of the ratings on the A-R-loan and class X-R to E-R notes, based on four hypothetical scenarios. "As our ratings analysis makes additional considerations before assigning ratings in the 'CCC' category, and we would assign a 'B-' rating if the criteria for assigning a 'CCC' category rating are not met, we have not included the scenario analysis results for the class F-R notes." Environmental, social, and governance S&P regards the exposure to environmental, social, and governance (ESG) credit factors in the transaction as being broadly in line with its benchmark for the sector. Primarily due to the diversity of the assets within CLOs, the exposure to environmental credit factors is viewed as below average, social credit factors are below average, and governance credit factors are average. For this transaction, the documents prohibit assets from being related to certain activities. Accordingly, since the exclusion of assets from these industries does not result in material differences between the transaction and S&P's ESG benchmark for the sector, no specific adjustments have been made in its rating analysis to account for any ESG-related risks or opportunities. Fernhill Park CLO DAC is a European cash flow CLO securitization of a revolving pool, comprising euro-denominated senior secured loans and bonds issued mainly by speculative-grade borrowers. Blackstone Ireland Ltd. manages the transaction. Ratings Amount Credit Class Rating* (mil. EUR) enhancement (%) Interest rate§ X-R AAA (sf) 3.500 N/A Three/six-month EURIBOR plus 0.92% A-R AAA (sf) 150.000 38.00 Three/six-month EURIBOR plus 1.28% A-R loan AAA (sf) 160.000 38.00 Three/six-month EURIBOR plus 1.28% B-R AA (sf) 55.000 27.00 Three/six-month EURIBOR plus 1.75% C-R A (sf) 30.000 21.00 Three/six-month EURIBOR plus 2.10% D-R BBB- (sf) 35.000 14.00 Three/six-month EURIBOR plus 3.05% E-R BB- (sf) 22.500 9.50 Three/six-month EURIBOR plus 5.50% F-R B- (sf) 15.000 6.50 Three/six-month EURIBOR plus 9.04% Sub notes NR 36.6 N/A N/A Add sub Notes NR 7.25 N/A N/A *The ratings assigned to the class A-R loan, X-R, A-R, and B-R notes address timely interest and ultimate principal payments. Our ratings address ultimate interest and principal payments on the rest of the other rated notes. §The payment frequency switches to semiannual and the index switches to six-month EURIBOR when a frequency switch event occurs. EURIBOR--Euro Interbank Offered Rate. NR--Not rated. N/A--Not applicable. TORO EUROPEAN 6: Fitch Corrects May 29 Rating Action ---------------------------------------------------- Fitch Ratings corrects an error in its rating Outlook on the Toro European CLO 6 DAC Class F notes published on May 29, 2026. On May 29, 2026, Fitch Ratings downgraded the class F notes to 'CCCsf'. The rating actions table at the top of the RAC should not have included a rating Outlook for the class F notes, as no rating Outlook had been assigned. Fitch has therefore removed the class F Outlook to correct the error. Entity/Debt Rating Prior ----------- ------ ----- Toro European CLO 6 DAC F XS2027431290 LT CCCsf Revision Outlook CCCsf KEY RATING DRIVERS Outlook Removal: The Outlook Stable on the class F notes erroneously published on 29 May has been removed as it was not originally assigned. See the last RAC for details of the prior rating action. RATING SENSITIVITIES Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade Based on the current portfolio, downgrades may occur if the loss expectation is larger than 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 occur if portfolio credit quality remains stable and the transaction deleverages, 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 Toro European CLO 6 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 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 Toro European CLO 6 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 ========= OMNIA TECHNOLOGIES: Fitch Affirms 'B' LongTerm IDR, Outlook Stable ------------------------------------------------------------------ Fitch Ratings has affirmed Omnia Technologies S.p.A.'s Long-Term Issuer Default Rating at 'B' with a Stable Outlook and its senior secured rating at 'B' with a Recovery Rating of 'RR4'. The rating is constrained by still volatile free cash flow (FCF) generation, which Fitch expects will stabilise over time, and limited headroom under its negative EBITDA leverage sensitivity. Rating strengths are the group's larger scale and better profitability after integrating recent acquisitions, which strengthened its market position and customer diversification in the niche beverage machinery industry. The Stable Outlook reflects Fitch's view that revenue growth and cost synergies should support EBITDA growth and deleveraging in 2026-2029. Key Rating Drivers Successful Acquisitions Integration: Revenue of EUR744 million for 2025 was ahead of Fitch expectations, driven by a stronger contribution from the acquisitions of ACMI, a producer of high-speed end-of-line equipment, and the SACMI beverage division, a producer of high-speed blowing and filling equipment. Fitch expects the group to continue expanding through bolt-on acquisitions, especially in life sciences, funded by cash flow. Large debt-funded acquisitions could lead to negative rating action. Improved Profitability: Timely integration of recent acquisitions has enabled synergy delivery ahead of schedule and improved Omnia's Fitch-defined EBITDA margin to 14.4% in 2025 from 12.6% in 2024, two years ahead of Fitch's expectations. Fitch's rating case assumes further EBITDA margin improvement to about 15.5% in 2028-2029, supported by additional optimisation measures, expansion in life sciences and a higher share of aftermarket revenue, which already accounts for about 28% of group sales. Continued Deleveraging Expected: Stronger EBITDA generation offset the impact of a EUR100 million add-on to Omnia's senior secured notes issued in June 2025, causing EBITDA leverage to fall to about 6x at end-2025, from about 9x a year earlier and versus Fitch's expectation of 6.3x. Fitch expects leverage to remain flat at end-2026, before declining steadily to below 5x by 2029, supported by revenue growth, margin improvement and slightly positive FCF. Stabilising FCF Generation: Higher-than-expected working capital outflows and capex in 2025, partly linked to the new Omnia headquarters, resulted in deeply negative FCF of about EUR55 million. Fitch forecasts a slightly positive FCF margin in 2026, rising to the low single digits in 2027-2029, supported by better EBITDA, modest capex and no dividend payments. This should support deleveraging. Leader in Niche Market: Omnia produces machinery mainly for the beverage sector, especially for wine, soft drinks, water and spirits. It holds a leading position in a niche market with stable demand and sells its products globally. The group has a well-established footprint, good geographic diversification and longstanding customer relationships. Its portfolio covers the full value chain across end-markets, supporting backlog visibility and moderate revenue visibility. Peer Analysis Omnia Technologies' business profile, like those of Flender International GmbH (B+/Stable), EVOCA S.p.A. (B-/Negative) and Ammega Group B.V. (B-/Negative), is constrained by a less diversified product range and end-markets exposure than at larger industrial peers. Nevertheless, the group has good geographical diversification, similar to Ahlstrom Holding 3 Oy (B/Stable), Ammega, Flender and INNIO Holding GmbH (B+/Stable). Omnia Technologies' solid double-digit EBITDA margins are similar to those of some Fitch-rated diversified industrial peers, such TK Elevator Holdco GmbH (B/Rating Watch Positive), Ahlstrom and Ammega. Fitch forecasts FCF margins to become neutral in 2026 and lower than Flender's and TK's, which are in the low single digits. Fitch forecasts Omnia Technologies' leverage at about 6.0x at end-2026, which would be commensurate with that of Ahlstrom and Flender, but lower than at TK Elevator and Ammega. Fitch’s Key Rating-Case Assumptions - Revenue growth of 2% in 2026 due to macroeconomic uncertainties affecting new orders and 4% in 2027-2029 - Optimisation programme and synergies from acquisitions to improve EBITDA margin to 14.8% in 2026 and 15.8% by 2029 - Capex at EUR25 million a year in 2026-2029 - M&A of EUR20 million a year in 2026-2029 - No dividend payments to 2029 Corporate Rating Tool Inputs and Scores Fitch scored the issuer as follows, using its Corporate Rating Tool (CRT) to produce the Standalone Credit Profile (SCP): Business and financial profile factors (assessment, relative importance): management ('bb-', Lower), sector characteristics ('bbb-', Moderate), market and competitive positioning ('bb+', Higher), diversification and asset quality ('bb', Moderate), company operational characteristics ('bb+', Moderate), profitability ('bb-', Moderate), financial structure ('ccc+', Higher), and financial flexibility ('bb-', Moderate). The quantitative financial subfactors are based on standard CRT financial period parameters: 20% weight for the historical year 2025, 40% for the forecast year 2026 and 40% for the forecast year 2027. B+ to CC considerations apply in its analysis and have no impact. The governance assessment of 'good' has no impact. The operating environment assessment of 'a-' has no impact. The SCP is 'b'. To derive the Long-Term IDR: Fitch made no adjustments to the SCP, resulting in an IDR of 'B'. Recovery Analysis - The recovery analysis assumes that Omnia Technologies would be reorganised as a going concern in bankruptcy rather than liquidated. - Fitch assumes a 10% administrative claim. - Fitch estimates going-concern EBITDA at EUR75 million (revised from EUR70 million after 2025 and 2026 acquisitions), reflecting its view of a sustainable, post-reorganisation EBITDA on which Fitch bases the valuation of the group (Fitch has not incorporated ongoing debt-funded bolt-on acquisitions). - Fitch applies an enterprise value multiple of 5.0x to going concern EBITDA to calculate a post-reorganisation valuation. This reflects Omnia Technologies' good market position in the production of equipment for the beverage industry and healthy geographical and customer diversification. The multiple also reflects the group's constrained scale compared with that of peers. - Fitch estimates senior debt claims at EUR730 million, comprising a EUR115 million super senior secured revolving credit facility, about EUR15 million of short term facilities at the operating company's level and EUR600 million senior secured notes. - Its waterfall analysis generated a ranked recovery for Omnia Technologies' notes equivalent to a Recovery Rating of 'RR4', leading to a 'B' rating. RATING SENSITIVITIES Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade - EBITDA leverage above 6.0x (revised down from 7.0x to reflect updated peer comparison) - EBITDA interest coverage below 2.0x - Consistently negative FCF margin - Aggressive shareholder-friendly policies or acquisitions leading to a further increase in leverage Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade - EBITDA leverage below 5.0x - FCF margin consistently above 2% - Successful implementation of strategic optimisation initiatives and integration following acquisitions, leading to EBITDA margin growth Liquidity and Debt Structure As of 31 March 2026, Omnia Technologies reported EUR38 million of cash on its balance sheet, before Fitch's adjustment of EUR12 million for cash that is not readily available. The group also had EUR80 million available under its EUR115 million revolving credit facility after a EUR35 million drawdown in 1Q26. Fitch expects FCF to be neutral in 2026 and to exceed EUR10 million annually from 2027, which will also support liquidity. Most of the group's debt is represented by EUR600 million of senior secured floating-rate notes. The notes mature in seven years, leaving no material scheduled debt repayments until November 2031. Issuer Profile Omnia Technologies is an Italy-based company providing automated machinery and end-to-end solutions, mainly for the wine and beverage industry, but also the pharmaceutical industry. The product portfolio focuses on processing, bottling, packaging systems, vial filling, capping and water treatment. 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. Climate Vulnerability Signals The results of its Climate.VS screener did not indicate an elevated risk for Omnia. 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 ----------- ------ -------- ----- Omnia Technologies S.p.A. LT IDR B Affirmed B senior secured LT B Affirmed RR4 B =================== L U X E M B O U R G =================== HSE INVESTMENT: Fitch Alters Outlook on 'B-' IDR to Positive ------------------------------------------------------------ Fitch has revised HSE Investment S.a r.l.'s Outlook to Positive from Stable, while affirming its Long-Term Issuer Default Rating (IDR) at 'B-'. Fitch has also affirmed HSE's senior secured notes (SSNs) at 'B' with a Recovery Rating of 'RR3'. The Positive Outlook reflects its expectation that HSE will extend its positive financial performance of 2025 into 2026 and beyond, with the mandatory allocation of excess cash from positive free cash flow (FCF) used to prepay its SSNs, leading to a strengthening of leverage and coverage. Fitch sees rating upside if HSE also stabilises its customer base, which it nearly achieved in 2025. The rating reflects HSE's small scale, with a niche position in the non-food retail sector, its focus on highly discretionary spending, and its limited diversification by channel and geography, though its channel diversification is improving. These rating constraints are balanced by its expertise and a long operational record in its markets, with a core group of loyal customers and a diversified product offering. Key Rating Drivers Solid Performance Continues Into 2026: HSE demonstrated strong results in 2025, with sales growing 4% year-on-year (yoy). Performance was driven by increase in merchandise value sold per customer with both order frequency and average selling prices up yoy. This was partly offset by a small decrease in total customers as continued growth of HSE's e-commerce audience was insufficient to offset a decline in TV customers. Stabilisation of net acquired customers will underpin the quality and sustainability of the business' growth prospects. Organic and Inorganic Deleveraging: Improvement in EBITDAR profitability to 12.9% in 2025 from 11.7% in 2024, alongside revenue growth, led to higher EBITDAR at EUR83 million (2024: EUR72 million), which remains below its positive rating sensitivity. Fitch, however, expects consistent growth in EBITDAR to over EUR90 million by 2027-2028. Organic deleveraging is complemented with continued debt prepayment. Fitch has incorporated EUR50 million of further debt prepayment under its forecast for 2026-2028, which should support further deleveraging to 4.1x in 2026 and to 3.6x by end-2028. Transitioning Away From TV: Fitch views the TV shopping industry as structurally declining, as well as being exposed to increased competition from online retailers and marketplaces, similarly to more conventional fashion and beauty retailers. HSE has made great progress in diversifying away from TV, with its digital channels (webshop and apps) taking a greater share of sales each year. Digital channels, in addition to providing opportunities to stabilise and expand HSE's customer base, have the benefit of bringing in younger shoppers, who will be customers for longer. Fitch sees the continued progress in moving towards eCommerce as key to HSE's ongoing recovery. Expected Positive FCF: HSE's business model requires only limited capex intensity, which allows the company to translate its profitability into consistently positive FCF, ranging between 1% and 3% of sales in 2023-2025. Fitch expects FCF to remain positive throughout the forecast horizon, with FCF margins gradually rising with profitability from 1.5% in 2026 to around 3% in 2029. Small Scale, Niche Position: HSE's scale is fairly small relative to its non-food retail peer group. Future expansionary growth remains limited by its core business remaining anchored in the German-speaking part of Europe (DACH region) and by the specificities of the channels in which it operates. International expansion attempts beyond these geographies have not always been successful. Fitch expects challenges in attracting new customers due to a slower ramp-up of the social network live (livestream) commerce format in Europe compared with other parts of the world. Focus on Discretionary Products: HSE has broad product diversification, but its business is focused on impulse-driven, often medium-to-large ticket purchases that are typically discretionary. It focuses on the 'silver generation', which is growing as a proportion of population and total spending in the fashion and beauty categories. However, although typically more financially independent than younger generations, this group of consumers are increasingly price-sensitive in the current challenging environment, and the Iran war in particular may dampen sentiment and further constrain spending on high-ticket items. PIK Notes Treated as Equity: Fitch analyses the payment-in-kind (PIK) notes issued by HSE Finance S.a r.l. and incurred at HSE Finance S.a r.l., the holding company, using its Corporate Rating Criteria. Fitch takes into account their structural subordination, as they are issued outside the restricted group backing the SSNs, and their contractual subordination under the intercreditor agreement. Fitch therefore treats the PIK notes as equity under its criteria, despite a short tenor of around five years. Peer Analysis HSE's closest peer is QVC Group, Inc., which entered Chapter 11 bankruptcy protection on 16 April 2026. QVC has a very similar business model to HSE but has a larger scale and greater geographic diversification. The recent bankruptcy filings follow years of operating declines, which have increased QVC's leverage and risk to its business model longevity. Major challenges include declines in linear television viewership and reduced interest in QVC's core television shopping segment. The company's growth in social commerce, driven by its pivot to platforms like Instagram and TikTok has not been enough to mitigate declines in its core business. HSE's 2025 performance, in contrast, partly reflects the company's more effective pivot towards digital platforms, with TV customers now accounting for less than half of their customer base. HSE is small compared with The Very Group Limited (B-/Stable), but its weaker business profile is offset by much lower leverage compared with TVG's 7.6x for FY25, as well as better fixed charge coverage, resulting in a similar IDR. Fitch’s Key Rating-Case Assumptions - Annual revenue growth of 3%-3.3%, led by wellness, jewelry and beauty categories - EBITDA margin of 11.1%-11.4%, supported by product mix improvements and operating cost efficiencies - Annual working capital outflows of about EUR2 million - Annual capex of EUR14 million-16 million, peaking in 2026 - Non-operating and extraordinary cash outflows averaging EUR9 million a year -- No dividend distribution - No M&A - FCF generated to be used for SSNs repayment Corporate Rating Tool Inputs and Scores - Fitch scored the issuer as follows, using its Corporate Rating Tool (CRT) to produce the Standalone Credit Profile (SCP): Business and financial profile factors (assessment, relative importance): Management ('bb-', Moderate), Sector Characteristics ('b-', Higher), Market and Competitive Positioning ('b-', Higher), Diversification and Asset Quality ('bb-', Moderate), Company Operational Characteristics ('bb+', Lower), Profitability ('bb+', Moderate), Financial Structure ('bb', Moderate), and Financial Flexibility ('b+', Moderate). - The quantitative financial subfactors are based on standard CRT financial period parameters: 20% weight for the latest historical year 2025, 40% for the forecast year 2026 and 40% for the forecast year 2027. - B+ to CC considerations apply in its analysis and result in an adjustment of -1 notch. - The governance assessment of 'some deficiencies' has no impact. - The operating environment assessment of 'aa-' has no impact. - The SCP is 'b-'. - To derive the Long-Term IDR: - Fitch made no adjustments to the SCP, resulting in an IDR of 'B-'. Recovery Analysis The recovery analysis assumed that HSE would be considered a going concern (GC) in bankruptcy and that it would be reorganised rather than liquidated in a default. Fitch has assumed a 10% administrative claim. Fitch has applied a distressed enterprise value/EBITDA of 5x, in line with that of Takko Holding Luxembourg 2 S.à.r.l., above the 4.5x Fitch used for The Very Group, but below the 5.5x Fitch used for Afflelou S.A.S. Its GC EBITDA estimate at EUR50 million reflects the level of earnings required for the company to sustain operations as a GC in unfavourable market conditions of shrinking volumes and with an inability to pass on cost increases. Its EUR311 million of outstanding SSNs rank behind its EUR35 million super senior revolving credit facility, assumed fully drawn at default. Fitch treats supplier financing as senior unsecured and therefore rank them lower than the SSNs in the waterfall. Waterfall-generated recovery computation resulted in a ranked recovery for the SSNs in the 'RR3' band, indicating a 'B' rating. RATING SENSITIVITIES Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade - Failure to maintain consolidated positive sales growth, indicating a structural market decline - Consistently negative FCF margin as a result of profitability decline, unfavourable working capital changes or excess capex - EBITDAR gross leverage consistently above 5.5x - EBITDAR fixed charge cover approaching 1.0x Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade - A stabilised to growing customer base, with customers acquired at least offsetting losses - Growth in scale, with EBITDAR approaching EUR100 million - EBITDAR margin maintained above 13%, supporting positive FCF generation - EBITDAR gross leverage consistently below 4.5x - EBITDAR fixed charge cover above 1.5x Liquidity and Debt Structure Fitch expects readily available cash to remain at EUR25 million (after Fitch's EUR15 million restriction of cash for operating purposes), with available cash above this limit used to prepay the principal of the SSNs. Fitch expects the EUR35 million revolving credit facility to remain undrawn. The debt maturity profile is comfortable, with the outstanding EUR311 million SSNs (down from EUR340 million as a result of the mandatory allocation of excess cash for debt repayment) maturing in October 2029, and EUR192 million PIK notes in April 2030. Fitch believes that HSE would refinance all its instruments when its senior secured debt approaches maturity, even though a full repayment of its 2029 SSNs would automatically extend the maturity of the holding company's PIK notes to 2032. Issuer Profile HSE is the holding company of Home Shopping Europe, a home shopping TV network and an online shopping platform with operations in the DACH region. 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. Climate Vulnerability Signals The results of its Climate.VS screener did not indicate an elevated risk for HSE. 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 ----------- ------ -------- ----- HSE Investment S.a r.l. LT IDR B- Affirmed B- senior secured LT B Affirmed RR3 B =========== S W E D E N =========== RAMUDDEN GLOBAL: S&P Withdraws 'B' LongTerm Issuer Credit Rating ---------------------------------------------------------------- S&P Global Ratings today withdrew its 'B' long-term issuer credit ratings on Ramudden Global AB and subsidiary Ramudden Global (Group) GmbH. The outlook was stable at the time the ratings were withdrawn. S&P also discontinued the 'B' issue rating and '3' recovery rating on the group's EUR1.195 billion senior secured term loan B due December 2029 and on the EUR215 million senior secured revolving credit facility due June 2029. This follows the full repayment of the facilities after Ramudden was acquired by I Squared Capital on May 20, 2026. The acquisition was completed via a new holding company named Cube Safety BidCo AB. S&P assigned ratings to Cube Safety Bidco AB and the debt facilities issued to finance the transaction. =========================== U N I T E D K I N G D O M =========================== FRONTIER MORTGAGE 2026-1: S&P Assigns BB(sf) Rating on Cl X Notes ----------------------------------------------------------------- S&P Global Ratings assigned its credit ratings to Frontier Mortgage Funding 2026-1 PLC's class A NRR Loan Note and class A, B-Dfrd, C-Dfrd, D-Dfrd, E-Dfrd, F-Dfrd, G-Dfrd, and X-Dfrd notes. The class A notes and class A NRR Loan Note are collectively referred to as the "class A notes" and rank pro rata and pari passu. At closing, the issuer also issued unrated class Z notes, S certificates, RC1 and RC2 residual certificates, and a VRR Loan Note. Frontier Mortgage Funding 2026-1 securitizes a GBP1,374 million portfolio of first-lien owner-occupied (92%) and BTL (8.0%) residential mortgage loans in the U.K. Santander UK PLC originated the loans in the pool between 1996 and 2026, with a significant portion of the pool comprising legacy loans, 26.9% of which were originated before 2014. Although the loans were initially classified as prime, while the pool exhibits some nonconforming features. Overall, 17.2% of the loans are in arrears, including 8.2% that are delinquent by over 90 days. About one-third of the pool was originated over 10 years ago, leading to a weighted-average seasoning of just under nine years for the entire pool. The class A and B-Dfrd notes (when the most senior) benefit from a liquidity facility, which will be 1.5% of the higher of the class A notes' or class B-Dfrd notes' balance. This facility amortizes in line with the class A and B-Dfrd notes. Santander UK services the loan portfolio. As an established and leading U.K. servicer, we consider its underwriting criteria to be among the best in the market. Our ratings address the timely payment of interest and the ultimate payment of principal on the class A notes and the ultimate payment of interest and principal on the class X-Dfrd notes. Our ratings also address timely receipt of interest on the class B-Dfrd to G-Dfrd notes when they become the most senior class of notes outstanding. Most of the pool (83%) will bear a fixed interest rate, which will switch to a floating interest rate at a later stage. Given the rated notes will receive a floating coupon based on compounded daily SONIA, the transaction will be exposed to interest rate risk. To address this risk, the issuer will enter into a fixed-floating swap agreement. Counterparty, operational, or sovereign risks do not constrain our ratings. Ratings Class Rating* Amount (mil. GBP) A NRR Loan Note§ AAA (sf) 225.00 A§ AAA (sf) 990.62 B-Dfrd AA- (sf) 68.68 C-Dfrd A (sf) 34.34 D-Dfrd BBB (sf) 20.60 E-Dfrd BB (sf) 13.74 F-Dfrd B- (sf) 6.87 G-Dfrd CCC (sf) 6.87 Z NR 6.87 X-Dfrd BB (sf) 13.74 S Certificates† NR N/A RC1 NR N/A RC2 NR N/A VRR Loan Note** NR N/A *S&P said, "Our ratings address timely receipt of interest and ultimate repayment of principal for the class A NRR loan note, and A notes, and the ultimate payment of interest and principal on the other rated notes. Our ratings also address the timely receipt of interest on the rated notes when they become most senior outstanding." Any deferred interest is due at legal final maturity. §The class A notes and class A NRR loan note are, together, the "class A notes", and rank pro rata and pari passu among themselves. †From the step-up date, the S certificates will pay 0.10% per annum on the outstanding collateral balance paid pro rata with the class A debt. **The VRR loan note is issued for risk retention. NR--Not rated. N/A--Not applicable. OBAN CARDS 2026-1: S&P Assigns BB+(sf) Rating on Class E Notes -------------------------------------------------------------- S&P Global Ratings assigned its credit ratings to Oban Cards 2026-1 PLC's asset-backed floating-rate class A, B, C, D, and E notes. At the same time, S&P affirmed its 'AAA (sf)' rating on the outstanding 2021-1 series class A notes, which are expected to redeem in 2028. The collateralized debt comprises class A, B, C, D, and E notes, with unrated class Z notes being subordinated to the class E notes. The transaction has an initial scheduled revolving period of three years, during which principal collections are reinvested to purchase additional receivables, subject to early amortization upon the occurrence of certain events including performance-based tests. Vanquis Bank Ltd. (Vanquis) can extend the revolving period for an additional 12 months with no change to the notes' original terms and conditions. The rated notes pay a floating rate of interest plus a margin. If they are not redeemed by the original scheduled redemption date, the margin will increase to a higher step-up margin. A combination of note subordination and available excess spread provides credit enhancement on the rated notes. Principal collections from subordinated classes is available as liquidity support, while the class A, B, C, and D notes also benefit from liquidity provided by an amortizing reserve fund. Amounts exceeding the required reserve fund amount are released to the revenue priority of payments. Vanquis remains the initial servicer of the portfolio. Counterparty or operational risks do not constrain the ratings. The transaction documents adequately address any legal risk in line with S&P's legal criteria. Ratings Class/series Rating* Amount (mil. GBP) Ratings assigned (series 2026-1) A AAA (sf) 168.30 B AA- (sf) 28.80 C A- (sf) 28.35 D BBB (sf) 42.15 E BB+ (sf) 17.40 Z NR 15.00 Rating affirmed (series 2021-1) A AAA (sf) 233.35 *S&P's ratings address timely payment of interest and ultimate repayment of principal by legal final maturity on the rated notes. NR--Not rated. ZENTIA PROFILES: Interpath Advisory Appointed as Administrators --------------------------------------------------------------- Zentia Profiles Limited was placed into administration in the High Court of Justice, Business and Property Courts in Newcastle upon Tyne, Insolvency and Companies List, Court Number CR-2026-NCL-000066. William James Wright and James Ronald Alexander Lumb, both of Interpath Advisory, were appointed as Joint Administrators on June 8, 2026. The company, formerly known as Worthington Armstrong U.K. Limited and Filesymbol Limited, specialised in the manufacture of metal structures. Its registered office and principal trading address is Unit 401 Princesway Central, Team Valley Trading Estate, Gateshead, NE11 0TU. The Joint Administrators can be contacted at: William James Wright James Ronald Alexander Lumb Interpath Advisory Interpath Ltd 60 Grey Street Newcastle upon Tyne NE1 6AH Further information: Email: Zentia@interpath.com Interpath Advisory ********* 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 2026. 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 * * *