TCREUR_Public/170302.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, March 2, 2017, Vol. 18, No. 044


                            Headlines


A Z E R B A I J A N

AZERBAIJAN: Fitch Corrects February 24 Rating Release


D E N M A R K

NYKREDIT REALKREDIT: Moody's Raises BCA From Ba1


F R A N C E

CFHL1-2014: Fitch Puts 'BB' Notes Rating on Rating Watch Pos.
REXEL SA: Fitch Assigns 'BB(EXP)' Rating to EUR300MM Sr. Notes
REXEL SA: S&P Affirms 'BB' CCR, Outlook Remains Stable
VALLOUREC: S&P Lowers CCR to 'B' on Delayed Recovery


G E R M A N Y

AEG POWER: Court Commences Insolvency Proceedings


G R E E C E

GREECE: Bailout Talks with Creditors Resume in Athens


H U N G A R Y

EST MEDIA: Files for Bankruptcy, Assets Down in 4th Quarter


I R E L A N D

JUNO ECLIPSE 2007-2: S&P Lowers Rating on Class B Notes to CCC-


K A Z A K H S T A N

BANK RBK: S&P Revises Outlook to Neg. & Affirms 'B-/C' Ratings


L U X E M B O U R G

INTELSAT SA: May Need to Sweeten Terms of Proposed Debt Exchange
TRINSEO SA: Moody's Raises Corp. Family Rating to B1


N E T H E R L A N D S

PANGAEA ABS 2007-1: S&P Affirms 'CCC-' Rating on Class D Notes


S P A I N

ABENGOA SA: Posts Net Loss, Gets Consents for Cash Injection
BAHIA DE LAS ISLETAS: Tap Issuance Credit Neg., Moody's Says
TDA IBERCAJA 2: S&P Affirms 'B+' Rating on Class D Notes


U K R A I N E

FERREXPO PLC: Fitch Raises Long-Term IDR to 'B-', Outlook Stable


U N I T E D   K I N G D O M

ABBOTT GRANGE: Slips Into Administration
ANGLO AMERICAN: S&P Revises Outlook to Pos. & Affirms 'BB+' CCR
BHS: Princes St. Site Could be Transformed Into a Hotel
CO-OPERATIVE BANK: Virgin Money Eyes Parts of Rival
FLITCRAFT ECOBUILD: In Administration, 25 Jobs at Risk

PREMIERTEL PLC: S&P Affirms 'BB' Rating on Class B Notes
STONEGATE PUB: Moody's Affirms B2 Corporate Family Rating


                            *********


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A Z E R B A I J A N
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AZERBAIJAN: Fitch Corrects February 24 Rating Release
-----------------------------------------------------
Fitch Ratings released a commentary on Azerbaijan replacing the
version published on February 24, 2017, to include the issue
rating on Azerbaijan's senior unsecured short-term local-currency
bond.

The revised release is as follows:

Fitch Ratings has affirmed Azerbaijan's Long-Term Foreign- and
Local-Currency Issuer Default Ratings (IDR) at 'BB+' with
Negative Outlooks. The issue rating on Azerbaijan's senior
unsecured Foreign-Currency bond has also been affirmed at 'BB+'.
The Country Ceiling has been affirmed at 'BB+'. The Short-Term
Foreign- and Local-Currency IDRs have been affirmed at 'B' and
the issue rating on Azerbaijan's senior unsecured short-term
local-currency bond has been affirmed at 'B'.

KEY RATING DRIVERS

Azerbaijan's 'BB+' ratings balance a strong external balance
sheet and low government debt, stemming from accumulated
surpluses in times of high oil revenues, with a heavy dependence
on hydrocarbons, an underdeveloped policy framework, low
governance indicators and a weak banking sector.

The Negative Outlook reflects continued risks and uncertainty
around the macroeconomic and financial sector adjustment
currently under way.

Azerbaijan's 'BB+' IDRs reflect the following key rating drivers:

Public finances are stronger than 'BB' rated peers and surprised
on the positive side in 2016. Despite a large fall in oil
revenues in 2016, the consolidated general government deficit was
contained at 1.2% of GDP, below the 'BB' median of 3.3% and below
Moody's previous forecast of 7.3%, mostly due to a 41% capital
expenditure cut. Fitch expects a one-off widening in the budget
deficit to 8.4% of GDP in 2017, due to planned support through
the budget from sovereign wealth fund Sofaz to the banking
sector, worth around 12% of GDP. Beyond 2017, the fiscal balance
is expected to improve as oil prices recover; the envisaged
adoption of a fiscal rule could reduce the pro-cyclicality of
public finances over the medium term.

Deficits are largely financed by ample assets accumulated in
Sofaz. Despite a decline in the USD value of assets in 2015-2016,
they accounted for a comfortable 92% of GDP at end-2016
(USD33.1bn), were largely held in safe, liquid assets, and were
reported much more transparently than in most higher-rated oil
producers. Government debt therefore remains contained, at 22.5%
of GDP at end-2016, much lower than the 'BB' median of 51.1%.
Although public debt has an unfavourable currency composition
(88.2% was denominated in foreign currency at end-2016), this is
mitigated by the USD denomination of most Sofaz assets.

The plunge in oil prices has affected the current account
balance, which recorded an estimated deficit of 2.9% of GDP in
2016, in line with the 'BB' median. Despite two manat
devaluations in 2015, non-oil exports have not picked up and
imports have remained resilient. Fitch, however, only expects the
current account to return to surplus in 2018 as oil prices pick
up, and does not forecast any significant reduction in commodity
dependence given the expected rise in gas exports over the medium
term.

FX reserves fell to a historical low of USD3.9bn at end-2016
(2014: USD13.8bn), just covering three months of current account
payments. In a move to preserve FX reserves and Sofaz assets, the
central bank adopted a managed float regime in 2016, which it
intends to convert into a free float in 2017. Ongoing volatility
of the manat undermines confidence in the currency. Despite the
decline in FX reserves and Sofaz assets over the past two years,
the external balance sheet remains much stronger than the 'BB'
median, with the sovereign and non-bank private sector net
external creditor position above 100% of GDP.

The banking sector has become extremely vulnerable following the
devaluations and slowdown in the economy, with a Fitch Banking
System Indicator of 'ccc'. The newly created bank regulator FMSA
closed 10 banks in 2016 and continued to restructure the largest
bank IBA (holding 30% of total assets), which Fitch deems as
having failed in 2016. However, with NPLs high at 21% of gross
loans at end-2016 (and likely under-reported in Fitch's opinion),
and a sector-wide capital adequacy ratio of 7.6%, the sector is
likely to need further support in 2017. The bulk of it will be
provided by the budgeted Sofaz transfer but the state will
provide additional support to IBA during the year, which will add
to the 21% of GDP guarantees already extended over the past two
years.

Macroeconomic performance in 2016 was hard hit by the fall in oil
prices, the mishandled devaluations and problems in the banking
sector. Inflation remained much higher than the 'BB' median at
12.6% on average in 2016, despite a restrictive monetary policy,
as the high dollarisation rate (80% at end-2016) and lack of
confidence in the currency impair monetary policy transmission.
Real GDP contracted 3.8% in 2016, the third worst performance of
all Fitch-rated sovereigns, primarily reflecting a 27.6%
contraction in construction as public investment was cut. Oil
production also declined by an estimated 1% due to the natural
ageing of oil fields. Volatility of GDP, inflation and exchange
rate is therefore well above 'BB' medians.

Economic diversification is progressing very slowly despite some
improvement in doing business indicators but the expected rise in
oil prices and the start of gas production at the Shah Deniz 2
development around 2019 could lift growth prospects over the
medium term. Policy credibility could also improve growth
prospects if the ongoing reforms of the exchange rate and
monetary policy frameworks, and the restructuring of the banking
sector bear fruit. Fitch therefore expects a gradual improvement
in growth prospects over the next two years.

Structural features are weak relative to peers, with GDP per
capita falling below the 'BB' median in 2016 to USD3,600.
Political risk also remains significant, as illustrated by lower
governance indicators than 'BB' peers, a strengthening of power
centralisation after the September 2016 referendum, and small
social protests such as those in early 2016. Although the
conflict with Armenia over the Nagorno-Karabakh region has
stabilised since the flare-up in tensions in April 2016, the
situation remains volatile, the area is heavily militarised and
negotiations remain stalled.

SOVEREIGN RATING MODEL (SRM) and QUALITATIVE OVERLAY (QO)

Fitch's proprietary SRM assigns Azerbaijan a score equivalent to
a rating of 'B+' on the Long-Term Foreign Currency IDR scale.

In accordance with its rating criteria, Fitch's sovereign rating
committee decided not to adopt the score indicated by the SRM as
the starting point for its analysis because the SRM output has
migrated from 'BB-' to 'B+', but in Moody's views this is
potentially a temporary deterioration.

Assuming an SRM output of 'BB-', Fitch's sovereign rating
committee adjusted the output to arrive at the final Long-Term
Foreign Currency IDR by applying its QO, relative to rated peers,
as follows:

- External finances: +2 notches, to reflect the size of Sofaz
assets which underpin Azerbaijan's exceptionally strong foreign
currency liquidity position and the very large net external
creditor position of the country.

Fitch's SRM is the agency's proprietary multiple regression
rating model that employs 18 variables based on three year-
centred averages, including one year of forecasts, to produce a
score equivalent to a Long-Term Foreign Currency IDR. Fitch's QO
is a forward-looking qualitative framework designed to allow for
adjustment to the SRM output to assign the final rating,
reflecting factors within Moody's criterias that are not fully
quantifiable and/or not fully reflected in the SRM.

RATING SENSITIVITIES

The main factors that could, individually or collectively,
trigger negative rating action are:

- Policy initiatives or responses that further undermine
   macroeconomic stability;

- An erosion of the external asset position resulting from a
   failure to sustainably adjust budget execution to the lower
   oil price environment, or from a materialisation of large
   contingent liabilities;

- A further sustained and prolonged fall in hydrocarbon prices.

The Outlook is Negative. Consequently, Fitch does not anticipate
developments with a high likelihood of triggering an upgrade.
However, the main factors that could, individually or
collectively, trigger a revision of the Outlook to Stable are:

- Greater confidence in macroeconomic and financial policy
   management;

- Higher hydrocarbon prices that help preserve fiscal and
   external buffers;

- Improvement in governance and the business environment, and
   progress in economic diversification underpinning growth
   prospects.

KEY ASSUMPTIONS

Fitch currently assumes that Brent crude oil will average USD45/b
in 2017 and USD55/b in 2018.

Fitch assumes that Azerbaijan will continue to experience broad
social and political stability and that there will be no
prolonged escalation in the conflict with Armenia over Nagorno-
Karabakh to a level that would affect economic and financial
stability.



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D E N M A R K
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NYKREDIT REALKREDIT: Moody's Raises BCA From Ba1
------------------------------------------------
Moody's Investors Service has affirmed Nykredit Realkredit A/S's
long- and short-term issuer ratings at Baa1/P-2. The agency also
affirmed Nykredit Realkredit's baa1 BCA and Adjusted BCA, as well
as the entity's long- and short-term CR Assessments at
A3(cr)/P-2(cr).

Concurrently, Moody's upgraded Nykredit Bank A/S's long-term
senior unsecured debt and deposit ratings to Baa1 from Baa3, with
a stable outlook, aligning the bank's ratings with those of its
parent institution. The rating agency upgraded Nykredit Bank's
baseline credit assessment (BCA) to baa3 from ba1, its Adjusted
BCA to baa1 from baa2, and its long-term Counterparty Risk
Assessment (CR Assessment) to A3(cr) from Baa2(cr). The bank's
short-term deposit ratings were upgraded to P-2 from P-3, while
its short-term CR Assessment was affirmed at P-2(cr).

The outlook on all long-term ratings of Nykredit Realkredit and
Nykredit Bank is stable, reflecting Moody's expectation that
continued economic growth in Denmark will support their solvency
and liquidity profiles over the coming quarters.

RATINGS RATIONALE

  -- AFFIRMATION OF NYKREDIT REALKREDIT'S RATINGS

The affirmation of Nykredit Realkredit's long-term issuer rating
at Baa1 reflects: (1) the group's solid asset quality,
capitalisation and profitability, which underpins its standalone
baa1 BCA; and (2) Moody's unchanged assumptions around resolution
in the unlikely event that the institution faces solvency
challenges, which take into account the limited loss absorbency
of the group's liability structure in case of a bail-in (as per
Moody's Advanced Loss Given Failure (LGF) analysis), and a
moderate likelihood of government support.

The affirmation of Nykredit Realkredit's standalone BCA at baa1
primarily reflects its solid asset quality, capitalisation and
profitability. At end-2016, Nykredit Realkredit's 2.4% problem
loans as a percentage of gross loans remained broadly unchanged
compared with 2.5% in 2015, based on Moody's calculations, while
the ongoing economic recovery in Denmark should support further
gradual improvement going forward. Similarly, Nykredit
Realkredit's common equity tier 1 (CET1) capital ratio remained
sound at 18.8%, reflecting ample excess capital above regulatory
requirements. Further, pre-tax profits are on an improving trend
(DKK6.7 billion in 2016 compared with DKK4.7 billion in 2015),
benefiting from lower credit costs (provisions declined to DKK680
million from DKK920 million the year before).

The other driver for the affirmation of Nykredit Realkredit's
long-term issuer rating relates to Moody's unchanged assumptions
around resolution in the unlikely event that the institution
faces solvency challenges.

Although the entity is subject to the European Banking Recovery
and Resolution Directive (BRRD), Moody's notes that Nykredit
Realkredit is overwhelmingly funded by covered bonds, which are
outside the scope of securities that can be bailed in under the
Danish resolution framework, thereby providing no protection to
senior creditors. At end-2016, issued covered bonds accounted for
around 80% of Nykredit Realkredit's consolidated assets. As a
result, Nykredit's preliminary rating assessment (PRA) is
positioned at baa2, one notch below the institution's baa1
Adjusted BCA.

At the same time, however, Moody's believes that with a 40%
market share, Nykredit Realkredit is a systemically important
institution and assigns a moderate probability of support from
the Government of Denmark (Aaa stable), leading the agency to add
back one notch of support to the institution's long-term issuer
rating, to Baa1, mapping to a short-term issuer rating of P-2.

  -- UPGRADE AND ALIGNMENT OF NYKREDIT BANK'S RATINGS

The upgrade of Nykredit Bank's long-term ratings and their
alignment with the ratings of Nykredit Realkredit reflect: (1)
the improvement in the standalone credit profile of the bank,
which has led to the upgrade of Nykredit Bank's BCA by one notch
to baa3; (2) Moody's unchanged assumption of a very high
probability of affiliate support from Nykredit Realkredit; and
(3) Moody's re-assessment of the likelihood of government support
owing to the bank's financial and operational interconnectedness
with its systemically important parent institution.

The upgrade of the bank's BCA captures the bank's improving asset
quality and the agency's expectation of stable profitability,
balanced against a recent decline in its capital ratios. Nykredit
Bank's problem loans as a percentage of gross loans decreased to
6.2% at end-2016 compared with 8.5% at the end of 2015, based on
Moody's calculations. During 2016, Nykredit Bank benefited more
than other Danish banks from the benign domestic credit
environment because around 80% of its credit exposure relate to
corporates and small and medium sized entities. Also, during
2016, Nykredit Bank benefited from the reversal of credit
provisions of DKK141 million. Further, Moody's expects that
Nykredit Bank's profitability will continue to benefit from asset
quality improvements, somewhat offsetting the ongoing earnings
volatility, which is driven by the fair value accounting for
derivatives. Moody's assessment also takes into account the
bank's lower common equity tier 1 (CET1) ratio, which declined to
14.8% at end-2016 from 20.6% in 2015. The main driver for
Nykredit Bank's declining capital ratio was an increase in risk-
weighted assets of around 45% to DKK110 billion at end-2016 from
DKK76 billion in 2015, reflecting the implementation of more
conservative credit risk models. For 2017, Moody's expects
Nykredit Bank's capitalisation to remain stable.

Moody's assumption of very high level of affiliate support from
Nykredit Realkredit is unchanged and reflects the latter's
willingness and ability to support the bank's solvency, as
demonstrated by two recent capital injections into Nykredit Bank
in February 2015 and November 2016. Nykredit Bank's Adjusted BCA
therefore benefits from two notches of affiliate uplift from its
baa3 standalone BCA.

Further, in addition to maintaining the same assumptions around
resolution in its Advanced Loss Given Failure (LGF) analysis as
the parent, Moody's has also re-assessed its government support
assumptions for Nykredit Bank, aligning those assumptions with
those applied to Nykredit Realkredit, reflecting the high
strategic, financial and business-related operational
interconnectedness of the bank with its parent institution.
Nykredit Bank performs vital activities for the wider Nykredit
group, including acting as the counterparty for the majority of
derivatives and as market maker in covered bonds. The deep
interconnectedness with group functions renders Nykredit Bank
important from both an affiliate perspective and, indirectly, to
the system given the parent's own systemic importance.

  -- RATIONALE FOR THE STABLE OUTLOOK

The stable outlooks on Nykredit Bank and Nykredit Realkredit
reflect Moody's anticipation that the key credit characteristics
of the two entities will remain supported by the benign operating
environment over the next 12 to 18 months.

WHAT COULD CHANGE THE RATING UP/DOWN

Upward rating momentum for Nykredit Realkredit could develop
from: (1) further improvements in Nykredit Realkredit's funding
profile; (2) a sustained and material improvement in the group's
profitability, without a material increase in its risk profile;
and (3) improved performance of its banking arm, Nykredit Bank.

Downward rating pressure for Nykredit Realkredit could develop as
a result from: (1) a decrease in the group's capitalization; (2)
weaker asset quality; and/or (3) reducing liability maturities.

An upgrade of Nykredit Realkredit's ratings would likely drive an
upgrade on Nykredit Bank's long-term ratings. An upgrade of
Nykredit Bank's BCA could result from: (1) further meaningful
improvement in the bank's asset quality; and (2) material
improvement in the bank's profitability without an increase in
its risk profile, which will require increasing earnings
stability.

Downward rating pressure for Nykredit Bank could emerge from a
downgrade of Nykredit Realkredit's ratings or reduced prospect of
support from Nykredit Realkredit or the Danish government.
Downward pressure on Nykredit Bank's BCA could result from: (1) a
decrease in the bank's capitalization; (2) weaker asset quality;
and/or (3) constrained access to debt capital markets.

Upward rating momentum for the long-term ratings of Nykredit Bank
and Nykredit Realkredit could develop as a result of a change in
the group's funding structure, such as the issuance of higher
volumes of senior unsecured debt that would result in notching
uplift under Moody's LGF framework.

LIST OF AFFECTED RATINGS

Nykredit Bank A/S:

The following ratings and rating inputs of Nykredit Bank were
upgraded:

- Long-term bank deposit ratings to Baa1 from Baa3, stable
   outlook

- Short-term bank deposit ratings to P-2 from P-3

- Long-term Deposit Note/CD Program rating to (P)Baa1 from
   (P)Baa3

- Short-term Deposit Note/CD Program rating to (P)P-2 from
   (P)P-3

- Long-term senior unsecured debt ratings to Baa1 from Baa3,
   stable outlook

- Senior unsecured MTN program rating to (P)Baa1 from (P)Baa3

- Commercial paper rating to P-2 from P-3

- Other Short Term rating to (P)P-2 from (P)P-3

- Long-term Counterparty Risk Assessment to A3(cr) from Baa2(cr)

- Baseline Credit Assessment (BCA) to baa3 from ba1

- Adjusted BCA to baa1 from baa2

The following rating input of Nykredit Bank was affirmed:

- Short-term Counterparty Risk Assessment at P-2(cr)

Nykredit Realkredit A/S:

The following ratings and rating inputs of Nykredit Realkredit
were affirmed:

- Long-term issuer rating at Baa1, stable outlook

- Short-term issuer rating at P-2

- Long-term Counterparty Risk Assessment at A3(cr)

- Short-term Counterparty Risk Assessment at P-2(cr)

- Baseline Credit Assessment (BCA) at baa1

- Adjusted BCA at baa1

PRINCIPAL METHODOLOGY

The principal methodology used in these ratings was Banks
published in January 2016.



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F R A N C E
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CFHL1-2014: Fitch Puts 'BB' Notes Rating on Rating Watch Pos.
-------------------------------------------------------------
Fitch Ratings has placed CFHL1-2014's class C, D and E notes on
Rating Watch Positive (RWP) following the discovery of an error
in the application of Fitch's proprietary cash flow model.

Class C (ISIN FR0011782416): 'AAsf'; placed on RWP
Class D (ISIN FR0011782424): 'Asf'; placed on RWP
Class E (ISIN FR0011782432): 'BBsf'; placed on RWP

KEY RATING DRIVERS

Fitch has found that the May 2016 rating review analysis of
CFHL-1 2014 contained an inconsistency between the final inputs
used and outputs suggested by the cash flow analysis.

The correction of the inconsistency is expected to have an upward
effect on the model-implied ratings for the class C, D and E
notes.

Moody's has, therefore, placed the class C, D and E notes on RWP
following the discovery of this error. The class A2 and B notes'
ratings remain unaffected at 'AAAsf'.

The resolution of the RWP will take place following an updated
analysis of the transaction performance. Model-implied ratings
are one of several factors considered by rating committees.

RATINGS SENSITIVITIES

The resolution of the Rating Watch may result in an upgrade of
the class C, D and E notes of CFHL-1 2014 by up to three notches.

USE OF THIRD-PARTY DUE DILIGENCE PURSUANT TO 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. There were no findings that affected
the rating analysis. Fitch has not reviewed the results of any
third-party assessment of the asset portfolio information or
conducted a review of origination files as part of its ongoing
monitoring.

Prior to the transaction closing, Fitch reviewed the results of a
third-party assessment conducted on the asset portfolio
information, which indicated errors or missing data related to
the execution documentation. These findings were accounted for in
this analysis by assuming a 5% haircut to recovery rates across
all rating scenarios.

Prior to the transaction closing, Fitch conducted a review of a
small targeted sample of Credit Foncier de France's origination
files and found inconsistencies or missing data related to
property valuations. These findings were accounted for in this
analysis by assuming 6% haircut to property values.

Overall and together with the 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.


REXEL SA: Fitch Assigns 'BB(EXP)' Rating to EUR300MM Sr. Notes
--------------------------------------------------------------
Fitch Ratings has assigned Rexel, SA's planned EUR300 million
senior notes issue due in 2024 an expected senior unsecured
rating of 'BB(EXP)'. The final rating is contingent upon the
receipt of final documents conforming to information already
received by Fitch.

Proceeds of the notes will be used for early redemption of the
company's 5.25% notes due in 2020. The planned notes will be
unguaranteed, ranking pari passu to all existing and future
unsecured indebtedness of the issuer that is not subordinated to
the notes, including that under senior credit facilities.
Although under each of Rexel's bonds and the senior credit
facilities creditors only have a claim to the parent company,
there is cross-default with additional group debt above a minimum
threshold of EUR100 million. Moody's expects average recovery
prospects for unsecured bond holders in the event of default
resulting in a 'BB(EXP)' rating for the planned bond.

KEY RATING DRIVERS

Organic Sales Recovery: Fitch's rating case for Rexel (BB/Stable)
includes a return to organic growth in sales from 2017, albeit
only improving to 1.5% by 2019. The group's organic sales
stabilised in 4Q16 after several quarters of declines as Europe
returned to growth while declines slowed in Asia and North
America. Fitch assumes a positive effect from management's
refocusing on core geographies and market segments, together with
stronger markets in Europe in 2017 (tempered by any uncertainty
caused by Brexit in the UK) and return to growth in other regions
in 2018.

Profitability to Improve From 2017: In 2016, Rexel's EBITDA
margin remained below 5% for the second year in a row, at 4.8%.
However, Moody's expects this will improve from 2017 to about
5.6% by 2020. This slow uplift mainly reflects Moody's limited
organic sales growth forecasts, resulting in narrow positive
operating leverage. The latter should be partially mitigated by
further optimisation of the group's operating structure and gross
margin, as well as some margin-accretive acquisitions from 2018.
Fitch also assumes the successful achievement of management's new
disposal programme over 2017-2018, which is likely to take out
invested capital from several non-core, less profitable assets.

Resilient Free Cash Flow: Maintaining good FCF is critical for
the rating given high leverage. Moody's expects annual FCF to
average EUR183m (1.4% of sales) over 2017-2019. Moody's expects
FCF will improve back to above 1% (pre-dividend FCF above 2%)
this year due to a combination of improved EBITDA and a further
decrease in cash interest due to active debt management. Moody's
also expects moderate and broadly stable capex. Free cash flow
(FCF) remained positive in 2016, although weaker than prior year,
with pre-dividend FCF margin at 1.9% of sales and FCF margin of
0.9% resulting from lower EBITDA generation and high working
capital outflows reflecting sales acceleration in 4Q16.

Adequate Financial Flexibility: Despite some weakness in FCF
generation for 2016, moderate acquisition activity should allow
the group's financial flexibility to remain adequate for its
rating. Financial flexibility is also underpinned by the group's
healthy Funds From Operations (FFO) fixed-charge cover, which
Moody's expects to be in the 2.5x-3.0x range (2016: 2.3x) over
the next three years driven by reduced cash interest payments.
Critical additional rating support is management's strict
financial discipline, which Moody's expects to be maintained
through limited year-on-year increases in dividend payments.

Limited Leverage Headroom to Improve: Rexel's FFO adjusted net
leverage reached 5.8x in 2016 exceeding Fitch's guideline of 5.0x
for a 'BB' rating driven by high legacy acquisition spending and
a challenging trading environment. However, Fitch's Stable
Outlook reflects Rexel's position in the current cycle and its
reviewed financial policy. The sustainability of Rexel's leverage
headroom under the 'BB' rating will be heavily contingent on the
maintenance of a rigorous financial discipline. Fitch's 2017-2018
rating case incorporates limited increase in capex and dividends,
minimal bolt-on acquisitions in 2017 and the achievement of
management's new asset disposal plan.

Taking into account improving market conditions and assuming
management comply with their now more stringent financial policy,
including a stricter long-term leverage target, Rexel should
regain its rating headroom with FFO adjusted net leverage falling
back below 5.0x in 2018 (2017: 5.2x).

Average Bond Recovery Expected: Securitisation debt, finance
lease obligations and debt incurred by subsidiaries (together,
the senior debt) rank ahead of the senior unsecured notes
incurred by Rexel. However, any structural subordination concerns
are mitigated by expected limited senior leverage, measured as
senior debt/EBITDA, below the threshold of 2x that Fitch
considers critical (1.9x based on 2016 EBITDA). As a result,
Moody's expects average recovery prospects for unsecured
bondholders in the event of default. However, Moody's could
downgrade the senior unsecured rating by one notch should Rexel
sustain senior indebtedness over 2x EBITDA (based on 2016 EBITDA,
representing around EUR35m of incremental debt including
availability under securitisation lines).

DERIVATION SUMMARY

Rexel has a weak operating profitability measured as EBITDA and
EBITDAR margins and weak leverage metrics for the 'BB' rating
category. However, these factors are balanced by its high cash
conversion ratio throughout the cycle, resulting in resilient
free cash flow and adequate financial flexibility relative to
cyclical industrial manufacturers or building materials producers
in the 'BB' category.

KEY ASSUMPTIONS

- Positive organic growth in sales from 2017, strengthening
   towards 1.5% in 2019
- Steadily improving EBITDA margin, back to above 5% in 2018 and
   towards 5.6% in 2020
- Working capital outflows along with sales growth
- Stable annual capex at 0.9% of sales
- Limited increase in dividend distributions
- Average annual positive FCF of EUR183 million over 2017-2019
- Annual bolt-on acquisition spending growing along with
   improving operating performance, ranging from EUR50 million in
   2017 up to EUR250 million in 2019
- Asset disposals (approximately EUR800 million of revenues)
   over 2017-2018 with some positive effect on group EBITDA
   margin

RATING SENSITIVITIES

Positive: Future developments that may, individually or
collectively, lead to positive rating action include:

- EBITDA margin sustained at above 6%, reflecting better product
   mix, successful cost restructuring and/or higher resilience
   throughout the economic cycle;

- FFO adjusted net leverage below 4.0x on a sustained basis;

- Continued strong cash flow generation, measured as pre-
   dividend FCF margin comfortably above 2% (2015: 2.2%).

Negative: Future developments that may, individually or
collectively, lead to negative rating action include:

- EBITDA margin consistently below 5%;
- A large debt-funded acquisition, or a deeper-than-expected
   economic slowdown with no corresponding increase in FCF
   resulting in (actual or expected) lease-adjusted FFO adjusted
   net leverage above 5.0x on a sustained basis;
- A contraction of pre-dividend FCF margin to below 2% as a
   result of weaker EBITDA margin and/or a less tightly managed
   working capital;
- A more aggressive shareholder distribution policy leading to
   an erosion of FCF margin to below 1%.

LIQUIDITY

Healthy Liquidity: Liquidity was healthy as of December 31, 2016
with EUR619 million of cash on balance sheet, of which Fitch
considers EUR419 million as readily available for debt service.
Liquidity is further underpinned by EUR982 million undrawn
committed bank facilities. Rexel also has access to various
receivable securitisation programmes and a EUR500 million
commercial paper programme.

Following the 2016 bond refinancing exercise, Rexel has no major
debt repayments before 2020. Assuming the successful completion
of the bond refinancing proposed above, Rexel will have no major
debt repayments before 2022.


REXEL SA: S&P Affirms 'BB' CCR, Outlook Remains Stable
------------------------------------------------------
S&P Global Ratings said that it affirmed its 'BB' long-term and
'B' short-term corporate credit ratings on France-based
electrical parts distributor Rexel S.A.  The outlook remains
stable.

At the same time, S&P assigned its 'BB-' issue rating to the
company's proposed EUR300 million senior unsecured unguaranteed
notes.  The recovery rating is '5', indicating S&P's expectation
of recovery at around 10% in the event of a payment default.  The
final issue ratings are subject to the successful closing of the
proposed issuance and depend on S&P's receipt and satisfactory
review of all final transaction documentation.

S&P also affirmed its 'BB-' issue ratings on Rexel's unsecured
and unguaranteed EUR982 million revolving credit facility (RCF),
$500 million notes due in 2020, EUR500 million notes due in 2020,
and EUR650 million notes due in 2023.  The recovery rating on all
instruments is unchanged at '5', indicating S&P's expectation of
recovery at about 10% in the event of a payment default.

S&P plans to withdraw its issue-level and recovery ratings on the
$500 million notes, due 2020, upon repayment.

The affirmation reflects that in 2016, Rexel's performance was
broadly in line with S&P's forecast, and that in 2017-2019 S&P
expects EBITDA margins and credit metrics to gradually improve
and remain commensurate with the current rating.  This
improvement will be supported by a recovery in organic sales
growth that S&P forecasts in France, and by some stabilization in
the still weak North American oil and gas industrial segment and
in China.  S&P also believes that higher copper prices could
boost the company's top-line growth and margins.

On Feb. 13, 2017, Rexel announced an update to its medium-term
financial strategy.  It assumes disposal of assets equivalent to
EUR800 million of annual sales by the end of 2018, a higher focus
on organic sales growth and improving operating efficiency, a
more cautious stance toward acquisitions, and reducing leverage.
The company aims to achieve net debt to EBITDA of 2.5x by the end
of 2018 (compared with about 3.0x at the end of 2016).  Rexel is
yet to decide on the exact pool of assets to be disposed of, and
S&P has limited visibility on the amount of impairments and
potential restructuring costs associated with this process.
Therefore S&P does not include this potential disposal in its
base-case scenario. However, S&P believes that if implemented
successfully, this would allow the company to focus on its most
profitable markets and could support a further improvement in
EBITDA margins over the medium term.

"Our ratings on Rexel continue to reflect its large size; broad
diversity of end markets, geography, products, and customers; and
its solid market position in electrical distribution.  We
forecast total revenues of about EUR13 billion and adjusted
EBITDA of about EUR790 million in 2017.  Rexel is present in
Europe, North America, and Asia Pacific, providing about 55%,
35%, and 10% of total sales, respectively.  This helps
counterbalance diverging regional trends in periods of downturn.
In our view, Rexel's strong market position provides competitive
advantages versus smaller peers in terms of pricing, logistics,
and purchasing power.  According to Rexel's 2015 estimates, it
holds a 7% share in the fragmented global-low and ultra-low
voltage electrical products distribution market, and derives
about 60% of sales from the markets where it holds leading
positions.  Rexel's exposure to cyclical construction markets and
volatile copper prices is counterbalanced by its presence in the
more stable maintenance and replacement markets," S&P said.

At the same time, Rexel's aggressive financial risk profile
continues to constrain the ratings.  S&P forecasts that in 2016-
2018, Rexel's leverage will gradually reduce, but adjusted debt
to EBITDA will remain at about 4x and funds from operations (FFO)
to debt will not exceed 20%.  S&P forecasts credit metrics will
be only slightly stronger than the ones the company achieved in
2015-2016, and it remains to be seen how the announced asset
disposal program progresses over this period. At the same time,
S&P expects lower amounts to be spent on acquisitions in line
with management's guidance, which will support its positive free
operating cash flow generation.

S&P also notes that Rexel's capital structure is well balanced--
its weighted-average debt maturity is almost four years.  After
the $500 million senior unsecured notes are redeemed as planned,
the company will not face any large debt repayments until 2022.

In S&P's base case, it assumes:

   -- Organic revenue growth of about 0.5%-1.5%, underpinned by a
      gradual recovery in France, Germany, and the U.S.; some
      stabilization in Canada and China; and a boost from
      increasing copper prices will be offset by the disposal of
      an equivalent of EUR800 million sales by 2018.

   -- Adjusted EBITDA margins recovering to 6.0%-6.2% from about
      5.9% in 2015-2016, underpinned by improving trading
      conditions in key markets and a stronger focus on
      operational efficiency.

   -- No non-seasonal working capital outflows.

   -- Capital expenditure (capex) of about EUR120 million
      annually (equivalent to about 0.9% of total sales).

   -- Bolt-on acquisitions up to EUR50 million in 2017 and up to
      EUR100 million in 2018.

   -- Cash dividends of about EUR120 million annually.

Based on these assumptions, S&P arrives at these credit measures:

   -- Weighted-average adjusted debt to EBITDA of 3.9x-4.1x; and
      Weighted-average FFO to debt of 16%-18%.

The stable outlook reflects S&P's view that in 2017-2018, Rexel
will maintain adjusted EBITDA margins of about 6%, supported by a
gradual recovery in organic sales in Europe and North America.
The stable outlook also incorporates S&P's expectation that the
group will maintain adequate liquidity and leverage not exceeding
current levels, with adjusted debt to EBITDA of about 4x and FFO
to debt of about 16%-18%.

S&P could lower the ratings over the next 12 months if
challenging market conditions or a more aggressive financial
policy, such as large debt-financed acquisitions or higher cash
dividend payments than S&P currently expects, led to increasing
leverage.  This could result in debt to EBITDA reaching about
4.5x and FFO to debt reducing to 12%.  Weakening liquidity, with
the ratio of sources to uses decreasing to less than 1.2x, could
also put pressure on the ratings.

S&P could raise the ratings if a strong recovery in Rexel's key
markets and the successful implementation of the asset disposal
program underpinned a sustainable improvement in its EBITDA
margin and credit metrics, with FFO to debt increasing to more
than 20% on a consistent basis.  However, S&P sees this scenario
as unlikely over the next 12 months.


VALLOUREC: S&P Lowers CCR to 'B' on Delayed Recovery
----------------------------------------------------
S&P Global Ratings lowered its long-term corporate credit ratings
on France-based seamless steel tube producer Vallourec to 'B'
from 'B+'.  The outlook is negative.  S&P affirmed its 'B' short-
term corporate credit ratings.

At the same time, S&P lowered its issue rating on Vallourec's
senior unsecured debt to 'B' from 'B+'.  The recovery rating
remains unchanged at '3', reflecting S&P's expectation of
recovery of 60% in the event of default.

The downgrade reflects S&P's revised expectation that Vallourec's
EBITDA will remain negative in 2017 and that recovery of
profitability and cash flow generation will take longer than S&P
initially anticipated in the context of continued low investment
budgets in the oil and gas sector globally and Vallourec's still
high cost position (although mitigated by the implementation of
its cost-cutting program).  The downgrade also reflects S&P's
forecast of continued negative free operating cash flow in 2017
and, to a lesser extent, in 2018.

"We now expect negative reported EBITDA of at least EUR100
million for the full-year 2017, well below our previous estimate
of positive EUR200 million.  Although we expect higher activity
in U.S. shale to increase demand for pipes in that region in
2017, prices and margins will only increase with a lag, given
that contracts with big clients are renegotiated every 6-12
months only and that steel scrap prices have increased.
Vallourec's margins will also be pressured by low prices in the
contracts signed in 2016 for 2017 in other regions.  We also
believe that 2017 free operating cash flow (FOCF) is likely to be
heavily negative, at about EUR400 million-EUR500 million, despite
contained capital expenditures," S&P said.

Continued negative profitability and weak cash flow generation,
including potentially negative EBITDA for a third consecutive
year, is a significant weakness compared with some peers, such as
Tenaris.  As a result, S&P has revised its business risk profile
assessment on Vallourec to weak from fair.  This is despite
company's strong market positions in the concentrated premium oil
country tubular goods pipe industry, high barriers to entry,
given its premium products, and sound geographic diversification.

At the same time, S&P recognizes that Vallourec continues to take
steps to save costs and improve its competitiveness.  Last year,
this included the reduction of capacity in Europe, the
acquisition of low-cost capacity in China, and restructuring of
its Brazilian activity with its partners.  S&P believes that the
restructuring program, together with better pricing, should
support a material rebound in EBITDA in 2018-2019.

Although difficult to predict, EBITDA could recover to about
EUR200 million in 2018, by S&P's estimate, as the company
increases prices for key clients over the course of 2017 on the
back of a more supportive oil and gas industry environment,
increases in volumes, notably in the U.S., and the benefits of
cost savings and restructuring measures, both in Europe and
Brazil.  Further upside is likely in 2019.

FOCF is likely to remain moderately negative nevertheless in 2018
and S&P forecasts that Vallourec's net debt could increase to up
to EUR2.0 billion by year-end 2018, compared with EUR1.3 billion
at year-end 2016.  On this basis, adjusted debt to EBITDA is
likely to be still very high at above 8x in 2018 and only improve
toward 5x in 2019, provided the oil and gas industry environment
doesn't deteriorate once again.  On the positive side, S&P notes
that the company has strong liquidity, very limited debt
maturities in 2018, and should be able to finance the negative
FOCF in 2017-2018 with cash on hand and committed lines.

The negative outlook reflects the risks related to the market
environment, which could further delay the rebound in Vallourec's
EBITDA and cash flow generation.  S&P takes into account that
2017 financial performance will be very weak for the ratings and
that S&P anticipates a material improvement in 2018.

S&P would further lower the rating if it believed that
Vallourec's EBITDA would be negative or only slightly positive in
2018.  This could be the case, for example, if oil prices
declined once again below S&P's assumptions of $50/bbl, which
would likely put additional pressure on the company's margins and
volumes.  S&P could also lower the rating if the company's
liquidity deteriorates, for example if covenant headroom becomes
tight.

S&P would revise the outlook to stable if it sees improvement in
the profitability trend and anticipate a significant reduction in
leverage in 2018-2019, with strongly positive EBITDA in line with
S&P's base case of about EUR200 million in 2018 and increasing
thereafter.



=============
G E R M A N Y
=============


AEG POWER: Court Commences Insolvency Proceedings
-------------------------------------------------
Arnsberg Local Court, by virtue of a February 1, 2017 decision,
commenced insolvency proceedings as planned regarding the assets
of AEG Power Solutions GmbH and at the same time, ordered debtor-
in-possession management.  3W Power S.A., listed on the General
Standard of the Frankfurt Stock Exchange and headquartered in
Luxembourg (the "Issuer"), announced on November 22, 2016, that
its lossmaking subsidiary AEG Power Solutions GmbH, headquartered
in Warstein-Belecke, Germany, had filed an application for
"protective shield" proceedings to be conducted.  This
application was granted by the competent Arnsberg Local Court on
November 22, 2016.  The insolvency proceedings have now been
opened as scheduled.  Dr. Rainer Eckert from the law firm Eckert
Rechtsanwalte was confirmed by the court as the trustee.

AEG Power Solutions GmbH guarantees the repayment of the
2014/2019 bond issued by 3W Power S.A. (the "2014/2019 Bond") ,on
the basis of a guarantee dated July 29, 2014 (the "Guarantee").
In the bond terms of the 2014/2019 Bond ("Bond Terms"), TEAM
Treuhand GmbH was appointed joint representative for the
bondholders ("Joint Representative").  Arnsberg Local Court
therefore appointed TEAM Treuhand GmbH to the committee of
creditors for AEG Power Solutions GmbH on behalf of the
bondholders.

Against the backdrop of the protective shield proceedings at AEG
Power Solutions GmbH, the bondholders of the 2014/2019 Bond (the
"Bondholders") decided in the creditors' meeting of January 5,
2017 on certain amendments to the interest and termination rules
and the obligations of the Issuer with regard to financial
liabilities, guarantees and transaction security as well as other
termination waivers, authorisation of the Joint Representative
and consent to the amendment of collateral agreements, guarantees
and the collateral agency agreement and/or the conclusion of an
intercreditor agreement.  Reference is made to the wording of the
resolutions from the second Bondholders' meeting on January 5,
2017, by 3W Power S.A., published in the German Federal Gazette
on January 11, 2017.

Registration of claims from the guarantee given by AEG Power
Solutions GmbH

TEAM Treuhand GmbH, as Joint Representative of the Bondholders,
registered the claims of the Bondholders from the guarantee given
by AEG Power Solutions GmbH as collateral for the 2014/2019 Bond
within the framework of a global registration in the insolvency
table in the amount of the nominal value of the 2014/2019 Bond
and the interest since August 29, 2016 (inclusive).

According to Sec. 19(g) of the Bond Terms, the provisions of
Secs. 5 to 21 German Bond Act (SchVG) apply correspondingly to
the guarantors, including AEG Power Solutions GmbH, with regard
to the guarantees they granted.  A corresponding provision was
also included in the guarantee given by AEG Power Solutions GmbH.
Therefore TEAM Treuhand GmbH as Joint Representative according to
Sec. 19(3) and Sec. 22 SchVG is solely authorised and required to
assert the rights of the Bondholders from the guarantee given by
AEG Power Solutions GmbH to secure the 2014/2019 Bond.

The Bondholders do not have to and are not allowed to register
claims from the guarantee in the insolvency table.  Due to the
valid registration already done by TEAM Treuhand GmbH as Joint
Representative, the insolvency administrator will dispute
additional individual registrations by individual Bondholders.

Participation in the report meeting on March 16, 2017

By decision of February 1, 2017, Arnsberg Local Court also
specified a date for the creditors' meeting on March 16, 2017 at
11:00 a.m. before Arnsberg Local Court, Eichholzstrasse 4, 59821
Arnsberg (ground floor, courtroom 325).  At this meeting, the
next steps in the proceedings will be decided upon, based on a
report by AEG Power Solutions GmbH as debtor.  TEAM Treuhand GmbH
as Joint Representative will take part in this meeting and,
according to Sec. 19(3) SchVG, exercise the rights of the
Bondholders at this meeting.  TEAM Treuhand GmbH will then inform
the Bondholders about the report meeting.

At the instigation of TEAM Treuhand GmbH, the insolvency court
invites interested Bondholders to attend the report meeting as
guests so that Bondholders can also take part in the report
meeting but without being entitled to speak or vote.  All
Bondholders who wish to attend the report meeting are requested
to register one week prior to the report meeting by sending an
informal e-mail to TEAM Treuhand GmbH -- tth-3wpower@noerr.com --
so that the court can be informed of attendance in advance.  The
entitlement to take part in the report meeting depends on such
prior registration.  In addition, interested Bondholders must
enrol on site on the day of the meeting with a current securities
account certificate and a valid identity document.

TEAM Treuhand GmbH is still holding intensive talks with all
those involved and will rigorously audit and support the
restructuring efforts in the interests of the Bondholders.



===========
G R E E C E
===========


GREECE: Bailout Talks with Creditors Resume in Athens
-----------------------------------------------------
Nicholas Paphitis and Derek Gatopoulos at The Associated Press
report that Greece resumed long-delayed bailout talks with its
creditors on Feb. 28 as figures showed bank deposits in the cash-
strapped country running at a 15-year low.

Representatives from Greece's bailout inspectors in Europe and
the International Monetary Fund have resumed talks with the Greek
government on further reforms following a months-long delay
caused by disagreements over the appropriate austerity mix, the
AP relates.

Enacting the reforms to such things as pensions and the labor
market will unlock more bailout cash for Greece -- meaning it
will have enough money to pay off debts due in July and avoid a
potential exit from the euro, or Grexit, the AP states.

According to the AP, Finance Minister Euclid Tsakalotos said he
expects the talks to last "a week or ten days" and that the aim
is to achieve a "preliminary" agreement by the next scheduled
meeting of eurozone finance ministers on March 20.

"So we are now at the point where we wanted to be -- not from the
point of view of timing but as a procedure," the AP quotes
Mr. Tsakalotos as saying.  "We are now in a procedure where
everything will be agreed as a package," including fiscal
measures, budget targets after the current bailout expires in
mid-2018 and debt relief, all which will be submitted to Greece's
parliament for approval.

Greek government officials have insisted that any new pain that
will emerge from the discussions will be fully offset, the AP
notes.

Greece is under renewed pressure to resolve disagreements with
lenders ahead of a mid-summer spike in its debt repayment
schedule that it would be unable to cover without the resumption
of bailout loan payouts, the AP says.  Greece owes around EUR7
billion in July (US$7.6 billion) alone, the AP discloses.

The government's timeline for an agreement that would allow
Greece to join the European Central Bank's bond-buying program
and tap markets later this year has already been derailed,
prompting renewed speculation that the country could face another
default and even Grexit in the summer -- or be eventually forced
to seek yet another bailout, the AP recounts.



=============
H U N G A R Y
=============


EST MEDIA: Files for Bankruptcy, Assets Down in 4th Quarter
-----------------------------------------------------------
MTI-Econews reports that Est Media, a holding company listed on
the Budapest Stock Exchange, said it filed for bankruptcy on
Feb. 28.

According to MTI-Econews, Est Media seeks to reach an agreement
with its creditors that will allow the company to continue to
operate, while at the same time allowing it to remedy the
position of its net assets.

Est Media noted that its net assets had fallen by more than
HUF3.5 billion in the fourth quarter, MTI-Econews relates.



=============
I R E L A N D
=============


JUNO ECLIPSE 2007-2: S&P Lowers Rating on Class B Notes to CCC-
---------------------------------------------------------------
S&P Global Ratings has lowered to 'CCC-(sf)' from 'B-(sf)' its
credit rating on the class B notes issued by JUNO (ECLIPSE 2007-
2) Ltd.  At the same time, S&P has affirmed its ratings on the
transaction's class A, C, D, and E notes.

The rating actions follow S&P's review of the transaction's
portfolio performance under our European commercial mortgage-
backed securities (CMBS) criteria.

Upon publishing S&P's updated structured finance ratings above
the sovereign criteria (RAS criteria), it placed those ratings
that could potentially be affected "under criteria observation".
Following S&P's review of this transaction, its ratings that
could potentially be affected by the criteria are no longer under
criteria observation.

                     NEUMARKT (62% OF THE POOL)

The securitized loan (EUR122.3 million) represents the senior
portion of a whole loan.  The whole loan was originally secured
on a shopping center and office complex in central Cologne,
Germany.

The security has been liquidated following the sale of the
property in August 2011.  The cash manager has yet to distribute
the final recoveries and apply losses to the notes.  S&P
understands that the liquidation loss amount cannot be finalized
until the insolvency judge and the insolvency administrator have
undertaken a formal meeting to approve the final calculations in
the insolvency proceedings and the final claims.  The judge has
yet to set a date for this meeting.

In S&P's analysis, it has assumed principal losses on this loan
in its 'B' case rating stress scenario.

               OBELISCO PORTFOLIO (33% OF THE POOL)

The securitized loan (EUR64.1 million) was fully securitized at
closing.  The loan is now secured by nine office properties in
Italy: six are located in Rome, two in Milan, and one in the
southern town of Bari.  The loan originally matured in December
2015 and has been extended to December 2017.

S&P understands that the borrower has failed to meet a required
amortization target of EUR14 million, and consequently the loan
has breached its covenant to repay the loan so that the principal
amount outstanding is no higher than EUR50 million by Jan. 31,
2016.

The portfolio is multi-tenanted and has a reported vacancy level
of 59%.  The largest tenant and the top five tenants account for
about 27% and 49% of the portfolio's income, respectively.  The
reported weighted-average lease term until the next break is 3.8
years.

The portfolio was valued at EUR135.97 million in June 2016.  This
reflects a whole loan-to-value (LTV) ratio of 47%.

S&P has assumed principal losses in our 'B' rating stress
scenario.

                   PRINS BOUDEWIJN (5% OF THE POOL)

The securitized loan (EUR10.5 million) was fully securitized at
closing.  The loan failed to repay when it matured in February
2015 and was transferred to special servicing.

This loan is secured against a multi-tenanted office complex
located near Antwerp, Belgium.  The asset has a reported vacancy
level of 9% and a weighted-average lease term to first lease
break of 3.55 years.

The property was valued at EUR10.3 million in September 2016.
This reflects a whole LTV ratio of 105%.

S&P has assumed principal losses in our 'B' rating stress
scenario.

                       COUNTERPARTY RISK
S&P's current counterparty criteria allow it to rate the notes in
structured finance transactions above S&P's ratings on related
counterparties if a replacement framework exists and other
conditions are met.  The maximum ratings uplift depends on the
type of counterparty obligation.  In this transaction, Barclays
Bank PLC is the cash deposit bank.  In accordance with S&P's
current counterparty criteria, Barclays Bank can support a
maximum potential rating of 'A (sf)' on the notes in this
transaction.

                        RATING ACTIONS

S&P's ratings address the timely payment of interest and the
payment of principal no later than the legal final maturity date
in November 2022.

Although S&P considers that the available credit enhancement for
the class A notes adequately mitigates the risk of losses from
the remaining underlying pool of loans in higher-stress
scenarios, our rating on this class of notes remains constrained
at 'A (sf)' by the counterparty.  In addition, under S&P's
structured finance ratings above the sovereign criteria (RAS
criteria), the rating on this class of notes is also constrained
at 'A (sf)').  S&P has therefore affirmed its rating on the class
A notes at 'A (sf)'.

S&P's analysis indicates that the available credit enhancement
for the class B notes is not sufficient to mitigate the risk of
principal losses from the underlying loans in a 'B' stress
scenario.  In S&P's opinion, this class of notes' repayment
depends on favorable economic conditions.  Class B noteholders
face at least a one-in-two likelihood of default.  Therefore, S&P
has lowered its ratings on the class B notes to 'CCC- (sf)' from
'B- (sf)', in line with S&P's criteria for assigning 'CCC'
category ratings.

S&P has affirmed its 'D (sf)' ratings on the class C, D, and E
notes because they experienced principal losses on previous
payment dates.

JUNO (ECLIPSE 2007-2) is a 2007-vintage synthetic transaction
backed by three loans (down from 17 at closing), secured on
mixed-use commercial properties in Germany, Belgium, and Italy.

RATINGS LIST

JUNO (ECLIPSE 2007-2) Ltd.
EUR867.95 mil commercial mortgage-backed floating-rate notes
                                  Rating
Class             Identifier      To                   From
A                 48204PAA5       A (sf)               A (sf)
B                 48204PAE7       CCC- (sf)            B- (sf)
C                 48204PAB3       D (sf)               D (sf)
D                 48204PAC1       D (sf)               D (sf)
E                 48204PAD9       D (sf)               D (sf)



===================
K A Z A K H S T A N
===================


BANK RBK: S&P Revises Outlook to Neg. & Affirms 'B-/C' Ratings
--------------------------------------------------------------
S&P Global Ratings revised its outlook on Kazakhstan-based Bank
RBK JSC to negative from stable.  S&P affirmed its 'B-/C' long-
and short-term counterparty credit ratings on the bank.

Also, S&P lowered its long-term Kazakhstan national scale rating
on Bank RBK JSC to 'kzB+' from 'kzBB-'.

The outlook revision and lowering of the national scale rating
reflect S&P's concerns that a material reduction in RBK's liquid
assets to the levels only slightly above the regulatory minimum
as of Feb. 17 2017, exposes the bank to liquidity pressures or
risk of breaching regulatory standards in a case of unplanned
fund outflows.  The bank's regulatory coefficient of current
liquidity (a liquidity measure with a three-month horizon) was
only 0.305x as of Feb. 17, 2017, versus the minimum of 0.300x.
Similarly, its liquid assets (cash, cash equivalents, short-term
interbank placements, and unledged securities) reduced to 7.7% of
total assets as of Feb. 17, 2017, from 15% as of Dec. 31, 2016.

Although S&P understands that there are seasonal effects at this
time of year on deposit outflows, S&P notes that the reduction in
liquid assets at RBK during the past two months was significantly
more pronounced that in past years during the same time period.
The bank has historically reported volatile liquid assets, but
this has been exacerbated by sizable customer deposit outflows of
about 12% since year-end 2016.  S&P observed similar fund
outflows from a few other small Kazakh banks over this time (due
to the impact of the default by two smaller Kazakh banks).
However, S&P notes that midsize Kazakh banks of similar size to
RBK were not affected as much and maintained a regulatory
coefficient of current liquidity of at least 1.0x.

S&P believes that RBK's current slim liquidity buffer, being
subject to volatility, exposes the bank to risks associated with
unplanned fund outflows, which cannot be excluded in Kazakhstan's
challenging operating environment.  Although this is not S&P's
base case, the possibility of these outflows in light of the
bank's volatile liquidity is the main driver behind S&P's
negative outlook on RBK.

S&P affirmed its global scale ratings based on S&P's base-case
assumption that RBK will continue to meet its moderate planned
repayments over the next few months fully and on time.  S&P bases
this expectation on RBK's planned attraction of new deposits
and/or potential shareholder (the bank's owner already injected
Kazakhstani tenge 9.9 billion [about $31 million] into the bank's
capital in February 2017) or regulator support.

The negative outlook on RBK reflects S&P's view of its weak
capitalization and volatile liquidity buffer amid the challenging
operating environment in Kazakhstan, which might impair the
bank's creditworthiness over the next 12 months.

S&P could lower the long-term global scale rating on the bank in
the next 12 months if RBK is unable to restore and sustain the
share of liquid assets above 10% of total assets by mid-2017.
That might happen if the bank is not able to attract planned
funding, fund outflows continue, or it does not receive liquidity
support from the owners or the regulator.  S&P could also lower
the rating if the bank does not comply with regulatory liquidity
ratios.  Substantial deterioration of RBK's loss absorption
capacity, with the expected risk-adjusted capital (RAC) ratio
falling below 3%, could also prompt a negative rating action.

S&P could revise the outlook to stable over the next 12 months if
RBK's liquidity cushion rebounds to levels comparable with that
of peers and if S&P believes that those improvements are
sustainable. An upgrade is also possible, if RBK restores and
sustains its RAC ratio above 5% in the next 12 months, while its
asset quality does not deteriorate beyond the system average
levels.



===================
L U X E M B O U R G
===================


INTELSAT SA: May Need to Sweeten Terms of Proposed Debt Exchange
----------------------------------------------------------------
Claire Boston at Bloomberg News reports that Intelsat SA
bondholders who are poised to gain more than US$200 million on a
proposed debt exchange connected to the satellite provider's
merger with OneWeb Ltd. may want even more.

According to Bloomberg, investors are bidding up Intelsat's bonds
to prices well beyond what the company said it would pay to
redeem the debt before its proposed tie-up with OneWeb, a U.S.
satellite venture backed by billionaire Masayoshi Son's SoftBank
Group Corp.  It's a sign that the Luxembourg company may need to
sweeten terms to convince holders of 85% of its bonds to accept a
combination of newly issued notes, shares and cash in exchange
for their bonds, Bloomberg says.

The exchange offer is worth about US$7.8 billion in new debt,
cash and stock and values the debt at an average of 74 cents on
the dollar, Bloomberg discloses.  That's a premium of about
US$200 million over where investors valued the debt on Feb. 24,
before reports of a potential merger sent prices soaring,
Bloomberg notes.  After the offer was announced Feb. 28,
investors continued to bid up the bonds eligible for the exchange
to about US$8.5 billion, Bloomberg relays.

Intelsat has struggled to reduce it debt as technological changes
and intense competition have cut into its revenue, Bloomberg
discloses.  The company's borrowings swelled after it went
through two leveraged buyouts and the acquisition of a
competitor, Bloomberg recounts.

Intelsat SA is a Luxembourg-based company that operates in
satellite services business. It provides communications services
to media companies, fixed and wireless telecommunications
operators, data networking service providers for enterprise and
mobile applications in the air and on the seas, multinational
corporations and Internet service providers.  The Company is also
a provider of commercial satellite communication services to the
United States government and other select military organizations
and their contractors.

                          *   *   *

As reported by the Troubled Company Reporter-Europe on Feb. 17,
2017, Egan-Jones Ratings, on Jan. 25, 2017, downgraded the senior
unsecured debt ratings on debt issued by Intelsat SA to CCC from
CCC+.

The TCR-Europe reported on Sept. 29, 2016, that S&P Global
Ratings said it lowered its corporate credit rating on
Luxembourg-based Intelsat S.A. to 'SD' from 'CC'.  S&P also
removed the ratings from CreditWatch, where it had placed them
with negative implications on Aug. 30, 2016.


TRINSEO SA: Moody's Raises Corp. Family Rating to B1
----------------------------------------------------
Moody's Investors Service upgraded the Corporate Family Rating
(CFR) of Trinseo S.A to B1 from B2 based on the improvement in
profitability its Performance Products segment and a more
optimistic medium term outlook for styrene. Moody's also raised
its Speculative Grade Liquidity Rating to SGL-1 from SGL-2. The
outlook is stable.

"Although styrene is expected to remain a cyclical commodity over
the longer term, capacity rationalization and industry
consolidation over the past decade, along with changes in the
propylene oxide market, provide a clear runway to sustained
profitability over the next 2-3 years at a minimum," said John
Rogers, Senior Vice President at Moody's. "The projected
improvement in Performance Materials profitability over the next
several years ensures that leverage will not rise back above 5.0x
when styrene eventually falls into another trough."

Ratings upgraded:

Trinseo S.A.

-- Corporate Family Rating to B1 from B2

-- Probability of Default Rating to B1-PD from B2-PD

-- Speculative Grade Liquidity Rating to SGL-1 from SGL-2

Trinseo Materials Operating S.C.A.

-- Guaranteed senior secured revolver and term loan to Ba2
   (LGD2) from Ba3 (LGD2)

-- Guaranteed senior unsecured notes to B2 (LGD5) from B3 (LGD5)

Outlook

Trinseo S.A. at stable

Trinseo Materials Operating S.C.A. at stable

RATINGS RATIONALE

The upgrade of Trinseo's CFR to B1 is supported by the improved
profitability of its Performance Materials segment and the
sustained profitability expected in styrene and polystyrene over
the next two to three years at a minimum. Styrene capacity
rationalization and industry consolidation over the past decade
in the US and Europe has improved profitability, despite
significant capacity additions in China, which have reduced the
global operating rate. The B1 CFR is supported by its size in
terms of revenue, leading market positions in three of its four
product lines (polycarbonates is the exception), relatively
stable volume demand in its Performance Materials businesses and
an experienced management team.

Moody's expects Trinseo's EBITDA to remain above $575 million for
the next several years despite volatility in key feedstocks.
Specifically, recent increases in butadiene prices will be a
significant headwind to EBITDA growth in 2017 and likely result
in lower profitability in the Performance Materials segment.
While the company is able to pass through increases in raw
material costs, albeit with a delay, the combination of raw
material volatility along with the timing of customer purchases
can create a significant quarter-to-quarter volatility in
profitability.

Management has targeted leverage of 1-2x on an ongoing basis;
however, debt is not expected to decline beyond required
amortizations. Due to the improvement in its Basic Plastics
(primary products are polystyrene and polycarbonate) segment,
credit metrics are expected to remain unusually strong for the
rating with Debt/EBITDA of less than 2.5x and Retained Cash
Flow/Debt of over 25%. These metrics include Moody's Standard
Adjustments to financial statements, which include the
capitalizations of pensions and operating leases. Moody's
adjustments add roughly $250 million to debt.

The SGL-1 rating reflects very good liquidity primarily supported
by cash balances of roughly $465 million (as of December 31,
2016) and the expectation that free cash flow will remain above
$250 million in 2017. The company also has access to a $200
million A/R securitization that had minimal outstandings at year
end and an undrawn $300 million revolver. The company has a
springing covenant in its revolver which requires the company to
maintain a pro forma first lien net leverage ratio of less than
2.0x, if greater than 30% is drawn. The company is expected to
remain well in compliance with this covenant over the next
several years.

The stable outlook reflects the near-term headwinds from higher
raw material prices and the expectation that Performance
Materials profitability will decline modestly in 2017. The rating
could be upgraded if Performance Materials EBITDA is sustained
above $350 million and debt does not increase above $1.5 billion.
The rating could be downgraded if the company significantly
increases leverage to fund share repurchases, resulting in
leverage of over 3.5x during the current styrene upcycle.

The principal methodology used in this rating was the Global
Chemical Industry Rating Methodology published in December 2013.

Trinseo S.A. is the world's largest producer of styrene butadiene
(SB) latex, the largest European producer of SSBR rubber
(solution styrene butadiene rubber), the third largest global
producer of polystyrene and a leading producer of polycarbonate
resins and blends. In 2016, Trinseo had revenues of roughly $3.7
billion, 15 manufacturing sites around the world, and nearly
2,200 employees.



=====================
N E T H E R L A N D S
=====================


PANGAEA ABS 2007-1: S&P Affirms 'CCC-' Rating on Class D Notes
--------------------------------------------------------------
S&P Global Ratings raised to 'A (sf)' from 'BBB+ (sf)' its credit
rating on PANGAEA ABS 2007-1 B.V.'s class A notes.  At the same
time, S&P has affirmed its ratings on the class B, C, and D
notes.

The rating actions follow S&P's credit and cash flow analysis of
the transaction using data from the December 2016 trustee report,
and the application of S&P's relevant criteria.

S&P conducted its cash flow analysis to determine the break-even
default rate (BDR) for each rated class of notes.  The BDR
represents S&P's estimate of the maximum level of gross defaults,
based on S&P's stress assumptions, that a tranche can withstand
and still fully repay the noteholders. S&P used the portfolio
balance that it considers to be performing, the reported
weighted-average spread, and the weighted-average recovery rates
that S&P considered to be appropriate.  S&P incorporated various
cash flow stress scenarios using its standard default patterns
and levels for each rating category assumed for each class of
notes, combined with different interest stress scenarios as
outlined in S&P's criteria.

The transaction's reinvestment period ended in June 2013.  Since
S&P's previous review, the class A notes have amortized further.

S&P's upgrade of the class A notes is mainly due to increased
available credit enhancement for the rated notes due to
structural deleveraging.  Just over 15% of the class A notes'
original principal balance remains outstanding following
repayments of EUR21 million since S&P's previous review.  The
available credit enhancement has increased for the class A notes
due to their deleveraging.  As was the case in S&P's previous
review, all of the collateral coverage tests continue to breach
their required triggers.  This has resulted in a net diversion
(interest diverted minus capitalization of the class D notes) of
just over EUR800,000 of interest proceeds for the redeeming
principal.  The reported weighted-average spread earned on the
collateral pool is 1.45%.

As the portfolio has deleveraged, obligor concentration has
increased, with the top-10 obligors now comprising 48%
(previously 42%) of the portfolio.  S&P has addressed this
concentration risk in its analysis by applying its largest
obligor default test, a supplemental stress test that we outline
in S&P's corporate collateralized debt obligation (CDO) criteria.
This assesses whether a CDO tranche has sufficient credit
enhancement to withstand specified combinations of underlying
asset defaults, based on the ratings on the underlying assets.
The test assumes a flat recovery of 30% for an original senior-
most tranche and 0% for an original subordinated tranche.
Furthermore, the correlation assumptions embedded in our CDO
Evaluator model also address concentration risk.

The portion of performing assets not rated by S&P Global Ratings
is 15.4%.  In this case, S&P applies its criteria "CDOs: Mapping
A Third Party's Internal Credit Scoring System To Standard &
Poor's Global Rating Scale," published on May 8, 2014, to map
notched ratings from another ratings agency and to infer S&P's
rating input for the purpose of inclusion in CDO Evaluator.  In
performing this mapping, S&P generally applies a three-notch
downward adjustment for structured finance assets that are rated
by one rating agency and a two notch downward adjustment if the
asset is rated by two rating agencies.

Since S&P's previous review, the proportion of assets rated in
the 'CCC' category ('CCC+', 'CCC', and 'CCC-') and the proportion
of defaulted assets has increased slightly in percentage terms,
while the remainder of the portfolio has a larger proportion of
investment-grade assets.  As a result, S&P has observed that its
scenario default rates -- the minimum level of portfolio defaults
S&P expects each CDO tranche to be able to support the specific
rating level using S&P's CDO Evaluator model -- have decreased
slightly at all rating levels.

With further deleveraging resulting in increased credit
enhancement, S&P's credit and cash flow analysis suggests that
the rating on the class A notes is commensurate with a higher
rating than that previously assigned.  S&P has therefore raised
to 'A (sf)' from 'BBB+ (sf)' our rating on this class of notes.

S&P has affirmed its ratings on the class B and C notes because
its cash flow analysis indicates that the available credit
enhancement is commensurate with their currently assigned
ratings. These tranches remain vulnerable to interest shortfalls
and would rely on principal proceeds if material defaults occur
or if higher yielding assets in the portfolio were to redeem.

The class D notes remain vulnerable to default and are currently
deferring interest payments as the class C notes are breaching
their overcollateralization test (at 105.85% versus a trigger
level of 110.0%).  S&P has therefore affirmed its 'CCC- (sf)'
rating on this class of notes as it considers it unlikely that
the notes will become current on their interest in the near term.

PANGAEA ABS 2007-1 is a cash flow mezzanine structured finance
CDO transaction that closed in March 2007.

RATINGS LIST

Class                     Rating
                   To              From

PANGAEA ABS 2007-1 B.V.
EUR309.2 Million Asset-Backed Floating-Rate Notes

Rating Raised

A                   A (sf)       BBB+ (sf)

Ratings Affirmed

B                  BB+ (sf)
C                  B+ (sf)
D                  CCC- (sf)



=========
S P A I N
=========


ABENGOA SA: Posts Net Loss, Gets Consents for Cash Injection
------------------------------------------------------------
Sarah White at Reuters reports that Abengoa SA on Feb. 28
reported a record net loss of EUR7.6 billion (US$8 billion) for
2016 and said it was close to wrapping up a debt restructuring
that has saved it from bankruptcy.

Abengoa said its business was hit by a cash crunch last year as
it raced to strike an agreement with creditors, which affected
the roll-out of new projects, Reuters relates.  It also booked
writedowns on a series of assets, Reuters notes.

Its earnings before interest, taxes, depreciation and
amortisation (Ebitda) was a negative EUR241 million in 2016,
Reuters discloses.  In 2015 it posted a net loss of EUR1.2
billion, Reuters recounts.

According to Reuters, Abengoa agreed to a debt-to-equity swap
with its creditors last October and earlier on Feb. 28 said it
now had the consents it needed for a planned new cash injection
as part of its restructuring.

                      About Abengoa S.A.

Spanish energy giant Abengoa S.A. is an engineering and clean
technology company with operations in more than 50 countries
worldwide that provides innovative solutions for a diverse range
of customers in the energy and environmental sectors.  Abengoa is
one of the world's top builders of power lines transporting
energy across Latin America and a top engineering and
construction business, making massive renewable-energy power
plants worldwide.

As of the end of 2015, Abengoa, S.A. was the parent company of
687 other companies around the world, including 577 subsidiaries,
78 associates, 31 joint ventures, and 211 Spanish partnerships.
Additionally, the Abengoa Group held a number of other interests
of less than 20% in other entities.

On Nov. 25, 2015 in Spain, Abengoa S.A. announced its intention
to seek protection under Article 5bis of Spanish insolvency law,
a pre-insolvency statute that permits a company to enter into
negotiations with certain creditors for restricting of its
financial affairs.  The Spanish company faced a March 28, 2016,
deadline to agree on a viability plan or restructuring plan with
its banks and bondholders, without which it could be forced to
declare bankruptcy.

On March 16, 2016, Abengoa presented its Business Plan and
Financial Restructuring Plan in Madrid to all of its
stakeholders.


BAHIA DE LAS ISLETAS: Tap Issuance Credit Neg., Moody's Says
------------------------------------------------------------
Moody's Investors Service announced that the B1 corporate family
rating of Bahia De Las Isletas, S.L., the top entity of the
restricted group of Spanish ferry operator Naviera Armas, S.A.
(Naviera) remains unchanged following the company's announcement
of a EUR50 million tap on its existing EUR232 million senior
secured notes due 2023 issued by Naviera. All other ratings
including B1-PD probability of default rating (PDR) of Bahia de
Las Isletas, S.L. and the B1 rating assigned to existing notes of
Naviera remain unchanged. The outlook on all ratings is
unaffected and remains stable.

The EUR50 million proceeds from the issuance will be used to
finance the investment in the construction of a new fast ferry
for EUR15 million, with the rest of the proceeds remaining within
the company. The tap offering has the same terms and conditions
as the existing notes.

The proposed transaction is credit negative to the extent that it
increases Naviera's pro forma gross debt/EBITDA ratio by around
40 basis points to 4.7x as of 30 September 2016 (as adjusted by
Moody's) from 4.3x at the time of the initial bond issuance in
June 2016. While adjusted leverage is still inside the 5.0x
leverage guidance to maintain a B1 rating, Moody's cautions that
Naviera's interest coverage (adjusted EBIT to interest expense)
will remain at the weaker end of the rating category in the next
12 to 18 months, at around 1.5x pro forma of the transaction.

That being said, the increase in financial leverage is mitigated
by the company's solid operating performance in recent quarters,
with revenues and EBITDA respectively up 2.9% and 16.2% in the
eleven months to November 30, 2016. This reflects the solid
volume and pricing performance achieved across all markets and
segments (both passengers and cargo) as well as the contained
operating costs mainly stemming from the lower oil price
environment and the active hedging policy. In addition, the
investment in the new fast ferry vessel will enable the company
to add more capacity in its core Inter-island market. Once the
vessel is delivered (2019 at the earliest), this will strengthen
the company's franchise over time.

Pro forma of the tap issuance and the planned investment for the
construction of a new fast ferry, Naviera is expected to have an
adequate liquidity profile, with cash on balance sheet of EUR62
million post transaction and an undrawn revolving credit facility
of EUR15 million. Nevertheless, Moody's cautions that the company
is likely to consider additional investments in new or second-
hand vessels in the next 12 to 18 months. If pursued, the
financing of new vessels would likely sit outside of the
restricted group though the equity portion of the financing,
which is partly paid upfront when the ship is ordered, is
expected to be borne by Naviera and would reduce the company's
liquidity.

Headquartered in Las Palmas, Naviera Armas, S.A. is a ferry
operator largely focused on the Canary Islands. The company
provides passenger and freight maritime transportation services
mainly within the Canary Islands and also to/from Southern Spain
and Northern Morocco. As at end-December 2016, the company
operated a fleet of 10 wholly-owned vessels. In the last twelve
months to Nov. 30, 2016, the company reported consolidated
revenues of EUR169.6 million and an EBITDA of EUR58.9 million.
The company has been operating for over 75 years and remains
under the Armas family ownership.


TDA IBERCAJA 2: S&P Affirms 'B+' Rating on Class D Notes
--------------------------------------------------------
S&P Global Ratings raised its credit ratings on TDA Ibercaja 2
Fondo de Titulizacion de Activos' class A and B notes.  At the
same time, S&P has affirmed its ratings on the class C and D
notes.

The rating actions follow the application of S&P's relevant
criteria and its credit and cash flow analysis of the most recent
transaction information that S&P has received, and reflect the
transaction's current structural features.

Long-term delinquencies (defined in this transaction as loans in
arrears for more than 90 days, excluding defaults) have decreased
to 0.36% from 0.44% since S&P's previous full review in October
2014, with defaulted loans (loans in arrears for more than 18
months) standing at 0.26%.

"In our opinion, the outlook for the Spanish residential mortgage
and real estate market is not benign and we have therefore
increased our expected 'B' foreclosure frequency assumption to
3.33% from 2.00%, when we apply our European residential loans
criteria, to reflect this view.  We base these assumptions on our
expectation that economic growth will mildly deteriorate.  We
expect nominal house prices in Spain to rise by 2.5% this year,
after gaining 4.0% in 2016.  We foresee slower house price growth
of 2.0% in 2018, as inflation edges up and fiscal policies
tighten," S&P said.

S&P's credit analysis results show a decrease in both the
weighted-average foreclosure frequency (WAFF) and weighted-
average loss severity (WALS) for each rating level based on the
higher seasoning of the pool, the transaction's improved
performance, and the lower current loan-to-value (LTV) ratios.
Under S&P's European residential loans criteria, its expected
credit losses are subject to a floor of 4.00% for a 'AAA' rating
level and a floor of 0.35% for a 'B' rating level.  S&P has
therefore increased the WALS for TDA Ibercaja 2 to meet the
minimum levels under European residential loans criteria.  The
overall effect is an increase in the required credit coverage for
each rating level in the transaction.

Rating level     WAFF (%)    WALS (%)
AAA                 14.99       17.35
AA                  11.21       14.66
A                    9.13        9.99
BBB                  6.64        9.50
BB                   4.25        7.10
B                    3.54        5.63

The transaction's fixed reserve fund is currently undrawn and
cannot amortize.  This has resulted in an increase in credit
enhancement, if S&P accounts for the level of available
performing collateral and cash reserve in the transaction, since
S&P's previous review for the class A, B, C, and D notes, even
though the notes are amortizing on a pro rata basis.  There are
interest deferral triggers for the subordinated notes in this
transaction, based on the level of outstanding defaults over the
original balance of the assets securitized, which as of Feb. 27,
is at 0.26%.  Given that the lowest interest deferral trigger
(class D trigger) is set at 3.3%, and based on the pool's
historical favorable performance, S&P don't expect the triggers
to be breached in the short to medium term.

S&P has given benefit to the swap counterparty, Credit Suisse
International as the downgrade language in place is in line with
S&P's current counterparty criteria.  The guaranteed investment
contract (GIC) provider in this transaction is Societe Generale
S.A. (Madrid Branch), which has a downgrade language commensurate
with a 'AAA (sf)' rating.

S&P's analysis indicates that the class A notes should be able to
withstand a severe but not extreme sovereign default and repay
timely interest and principal by legal final maturity.
Therefore, the rating on the class A notes in this transaction is
constrained by S&P's structured finance ratings above the
sovereign criteria (RAS criteria) at four notches above S&P's
'BBB+' long-term sovereign rating on Spain.

TDA Ibercaja 2 has a standardized, integrated, and centralized
servicing platform.  It is a servicer for a large number of
Spanish RMBS transactions, and the historical performance of the
Ibercaja Banco S.A. transactions has outperformed S&P's Spanish
RMBS index.  S&P believes that these factors should contribute to
the likely lower cost of replacing the servicer, and have
therefore applied a lower floor to the stressed servicing fee, at
35 basis points (bps) instead of 50 bps in S&P's cash flow
analysis, in line with table 74 of our European residential loans
criteria.

Taking into account the results of S&P's credit and cash flow
analysis, and the application of its RAS criteria, S&P considers
that the available credit enhancement for the class A notes is
commensurate with a 'AA-' rating.  Accordingly, S&P has raised to
'AA- (sf)' from 'BBB (sf)' our rating on the class A notes.
S&P's analysis also indicates that the available credit
enhancement for the class B notes is commensurate with a 'BBB'
rating.  S&P has therefore raised to 'BBB (sf)' from 'BB+ (sf)'
its rating on this class of notes.

S&P has affirmed its 'BB (sf)' and 'B+ (sf)' ratings on the class
C and D notes, respectively, as the available credit enhancement
is commensurate with the currently assigned ratings.

TDA Ibercaja 2 is a Spanish RMBS transaction that closed in
October 2005.  The transaction securitizes residential loans
originated by Ibercaja Banco, which were granted to individuals
for the acquisition of their first residence, mainly concentrated
in Madrid and Aragon, Ibercaja Banco's main markets.

RATINGS LIST

TDA Ibercaja 2 Fondo de Titulizacion de Activos
EUR904.5 Million Mortgage-Backed Floating-Rate Notes

Class             Rating
            To               From

Ratings Raised

A           AA- (sf)         BBB (sf)
B           BBB (sf)         BB+ (sf)

Ratings Affirmed

C           BB (sf)
D           B+ (sf)



=============
U K R A I N E
=============


FERREXPO PLC: Fitch Raises Long-Term IDR to 'B-', Outlook Stable
----------------------------------------------------------------
Fitch Ratings has upgraded Ferrexpo plc's Long-Term Issuer
Default Rating (IDR) to 'B-' from 'CCC'. The Outlook is Stable.
Ferrexpo Finance Plc's senior unsecured rating was upgraded to
'B-' from 'CCC'. The Recovery Rating on the senior unsecured
rating is 'RR4'. Ferrexpo's Short-term IDR was upgraded to 'B'
from 'C'.

The upgrade reflects Ferrexpo's improved liquidity as of December
2016 (USD145m cash versus USD35m in 2015, of which USD19 million
is restricted by Fitch) and strong free cash generation due to
higher-than-expected iron ore prices in 2016 and high pellet
premiums. Based on Fitch iron ore price deck, Moody's expects
Ferrexpo to be able to cover $528 million of debt maturing over
2017 and 2018 from a USD126 million cash balance and USD463
million in free cash flow generation.

KEY RATING DRIVERS

Deleveraging On Track: Ferrexpo paid the final instalment of its
USD420m pre-export financing (PXF) from internally generated cash
flow in 2016. The company still has USD263m of PXF outstanding,
which started amortising in November 2016 with eight quarterly
payments of USD43.8m. Moody's assumes that Ferrexpo will be able
to fund these maturities from internal cash flow.

The group's other significant debt instrument is a USD346m
Eurobond that matures in two equal instalments in April 2018 and
April 2019. Moody's believes Ferrexpo will be able to fund the
first instalment of USD173.2m from cash flow, acknowledging the
difficulties that could arise from iron ore price volatility.

Eurobond Refinancing Possible: Fitch also believes that
management will take additional steps for the refinancing of a
portion of its bond maturity. Moody's views the execution risk as
moderate, taking into account the company's deleveraging profile
and the recent evidence of a recovery in activity in Ukraine from
international banks and capital markets.

Competitive Cost Producer: Ferrexpo's operating cost position
sits within the first quartile of the global pellets cost curve.
In 2016, cash costs improved significantly compared with the
previous two years, mainly due to currency depreciation (50% of
operating costs are linked to the hryvnia) and lower energy
prices. These positive dynamics plus operating efficiency gains
resulted in a 10% decrease year-on-year, reaching USD29 per
tonne.

This is however 13% higher than 1H16 cash cost of USD25.7/t,
reflecting the increasing energy costs linked to oil price in
2H16 and Ukraine's inflation. Energy costs now represent around
40% to 50% of total costs, and combined with inflation should
contribute to further cost increases in 2017. Under Moody's
current energy price assumptions, Moody's expects the cash cost
to remain between USD33/t and USD34/t in the medium term, still
within the first quartile.

Ukrainian Risk Exposure: Ferrexpo's operating base is in Ukraine.
In the past two to three years the country has experienced high
inflation, significant currency depreciation (85% in 2015 against
the dollar more than 125% since 2014), and some delays in VAT
repayment by the state. The military conflict in the Donbass
region has not had a direct impact on Ferrexpo's because its
operations are based in the Poltava region, about 425km north of
Donetsk.

Continuing Profitability: Fitch expects that cash costs
improvements, together with the pellet premium received over the
benchmark 62% iron ore price will help Ferrexpo to maintain
profitability at high levels in 2016-2017. Moody's forecasts its
EBITDA margin to range between 35% and 40% (1H16: 35%), before
declining below 30% in 2018 due to a drop in prices linked to new
supply entering the market. Moody's expects Ferrexpo's funds from
operations- (FFO) adjusted gross leverage to decline to 2x at
end-2016 (3.4x in 2015) and to around 1.0x in 2017 in line with
Moody's expectations of an EBITDA improvement that results from
the recovery in iron ore prices and debt reduction.

Pellet Premium Recovers: Prices for 62% iron ore averaged USD59/t
in 2016, down 40% since 2014, as demand from the Chinese steel
industry slowed. However, prices and premiums have increased
significantly since October 2016, reaching USD81/t in January
2017 and USD45/t for the Platts Atlantic Pellet Premium received
over the 62% benchmark. Fitch expects the demand for premium
quality pellets to remain sound. Moody's also expect premium
pellet supply to be limited in the next couple of years due to
the disrupted supply from Samarco, the biggest premium pellet
producer, and the high capital cost of new pellet plants.

Long-Term Contracts: Ferrexpo compares favourably with its
competitors in the premium pellet market. It has long-term
contracts with European and North East Asian producers, which
secure the company with more predictable cash flows than its
peers operating in the sport market.

DERIVATION SUMMARY

Ferrexpo's weaker competitive position in terms of scale and size
of mining operations vs. major global peers such as Vale
(BBB/Negative) and Fortescue (BB+/Stable), is offset by its
positioning within the first quartile of the global pellets cost
curve and its access to the pellet premium market due to the high
quality of its pellets. Its weaker financial profile compared to
its peers is due to its exposure to Ukraine and the resulting
difficult access to debt markets, despite clear signs of
improvements since 2H16. No country-ceiling, parent/subsidiary or
operating environment aspects has an impact on the rating.

KEY ASSUMPTIONS

- Fitch iron ore price deck: USD60/t in 2017 (including the
actual price in January and February 2017), USD45/t in 2018 and
2019;

- Fitch forecasts the Platts Atlantic Pellet Premium to remain
around USD40/t in 2017 supported by stopped production at Samarco
and by demand from steel producers trying to replace expensive
coking coal by cheaper premium pellets and to decline to around
USD30 in 2018 and 2019 when Samarco's volumes come back to the
market;

- Production volumes: 11.6 million tonnes iron ore pellets per
year in 2017-2019;

- Under Fitch iron ore price assumptions Moody's assumes USD50
million capex in 2017 and USD65 million in 2018-2019.

RATING SENSITIVITIES

Future Developments That May, Individually or Collectively, Lead
to Positive Rating Action

- Strengthening of Ferrexpo's liquidity position due to new
sources of financing, a sustainable renegotiated debt maturity
profile or higher than expected iron ore prices and/or pellet
premiums.

Future Developments That May, Individually or Collectively, Lead
to Negative Rating Action

- Material shortfall in liquidity due to pellet premiums or iron
ore prices falling beyond Moody's assumptions without access to
alternative sources of liquidity.

LIQUIDITY

Sufficient for Debt Servicing: At end December 2016, the
company's reported cash balance was USD145m (of which Fitch
restricts USD19m to maintain the minimum level of operations)
against USD201m short-term debt, and USD46m coupon/interest. The
short-term debt is composed of USD175m of quarterly PXF
instalments and USD26m of other debt. Moody's forecasts that the
company will generate approximately USD300m of FCF over the next
12 months (post interest/coupon). This should be enough to
service the company's debt, working capital and capital
expenditures in 2017, but leaving it exposed to further
fluctuations in iron ore prices, currency and energy costs.



===========================
U N I T E D   K I N G D O M
===========================


ABBOTT GRANGE: Slips Into Administration
----------------------------------------
Sam Metcalf at East Midlands reports the owner of two historic
East Midlands hotels has slipped into administration.

Abbott Grange, which owns 15-bedroom Bridge Hotel in Thrapston,
and the Grade II listed Dovecliff Hall in Stretton, near Burton
upon Trent, has called in administrators from Duff & Phelps to
run the pair of hotels, according to East Midlands.

The hotels are owned by a family business headed by Tony Sachdev
and Gogi Singh.

Dovecliff Hall, in particular, has an illustrious past.  In the
19th Century, it was owned by Lord Bass who made many
contributions to Burton including the Ferry Bridge.  Mr. Bass was
a good friend of King Edward VII and the King visited the Bass
brewery and the family on their estate at Rangemore in 1902,
beginning the brewing of the now famous King's Ale, the report
notes.

The report says the Bridge Hotel is a hotel, restaurant and
wedding venue located in the market town of Thrapston in North
West Northamptonshire.

The report discloses in its latest accounts to December 31, 2015,
Abbot Grange owed creditors GBP684,167.


ANGLO AMERICAN: S&P Revises Outlook to Pos. & Affirms 'BB+' CCR
---------------------------------------------------------------
S&P Global Ratings said that it revised its outlook on global
mining company Anglo American PLC to positive from stable.  S&P
affirmed its global scale long-term corporate credit rating on
the company at 'BB+'.  S&P also raised its South African national
scale rating on Anglo to 'zaA+' from 'zaA'.

S&P affirmed the 'BB+' rating on Anglo's revolving credit
facility (RCF) and unsecured notes.  The recovery rating on the
debt is unchanged at '3', indicating S&P's expectation of
meaningful (65%) recovery prospects for creditors in the event of
default.

The outlook revision reflects the recent reported preliminary
figures for 2016 and the improvement in S&P's forecast for
commodity prices, which should strengthen the company's cash flow
generation capacity and could support an upgrade to 'BBB-' over
the coming 12 months.

S&P recently revised upward its price assumptions for most
commodities, including some of the key commodities in Anglo's
portfolio (iron ore, copper, and coal).  In addition, S&P sees
further improvement in the diamond industry's fundamentals.  The
revised price assumptions translate into stronger forecast credit
metrics for Anglo than in December 2016, when S&P raised the
rating to 'BB+' from 'BB'.

Under S&P's current base case, it projects that free operating
cash flow of about $3.0 billion-$3.2 billion will support a ratio
of funds from operations (FFO) to debt (under proportional
consolidation approach) of about 45%-55% in 2017.  S&P considers
a ratio of 45% on average through the cycle as commensurate with
a 'BBB-' rating.  This level implies a cushion for a 'BBB-'
rating to accommodate metrics below this average in some periods.
If existing spot prices persist, Anglo would likely materially
outperform S&P's base case -- for example, iron ore is currently
traded for $90/ton, while S&P assumes a price of $55/ton for the
rest of 2017.

One of S&P's key considerations in considering an upgrade is
Anglo's financial policy.  Recently, the company announced a
leverage target on reported net debt to EBITDA of 1.0x-1.5x
(equivalent to adjusted FFO to debt of 40%-50%).  Under S&P's
base-case scenario, the company will generate about $5.4 billion-
$5.8 billion of cash from operations in 2017, of which
$2.5 billion will be allocated to capital expenditure (capex),
leaving the company material cash flow to distribute between
further debt reduction and returns to shareholders.  S&P
understands that the company may consider reinstating its
dividend policy at the end of 2017, payable in April 2018.  That
said, given S&P's forecast of a rapid decline in company's net
debt position, S&P assumes modest dividends toward the end of
2017 in its base-case scenario.

Following the recent recovery in commodity prices and the rapid
reduction in the company's net debt position ($8.5 billion
reported debt in December 2016 compared with $12.9 billion in
December 2015), the company has decided to scale back its
previous plan to focus on commodities that have strong medium-
and long-term fundamentals such as copper, diamonds, and
platinum.  S&P understands that some of the valuable assets, such
as the Australian hard coking coal mines and the iron ore assets,
will remain part of its portfolio, while other small, less-
competitive assets will be divested over time.  That said, S&P
still sees the possibility that the iron ore and coking coal
assets could be divested for the right price.  Under S&P's base
case, it assumes that the coking coal and iron ore activities
will contribute more than 50% of the company's EBITDA in 2017.

Under S&P's base-case scenario, it projects that Anglo's
unadjusted EBITDA will be about $6.9 billion-$7.3 billion in 2017
and about $6.0 billion-$6.4 billion in 2018 (compared to a
preliminary S&P Global Ratings-adjusted EBITDA of $5.8 billion in
2016).  These assumptions underpin its base-case scenario:

   -- Iron ore prices of about $55/ton for the rest of 2017 and
      $50/ton in 2018. Current spot price is about $90/ton.
      Copper prices of about $2.3 per pound (/lb) for the rest of
      2017 and $2.4/lb in 2018.

   -- Coking coal prices of about $180/ton for the rest of 2017
      and $140/ton in 2018.

   -- Production broadly in line with the company's guidance.

   -- No divestments on top of the already agreed sales.  Bulks
      and other mineral assets will continue to contribute to
      EBITDA and to cash flows.

   -- Capex will be largely limited to maintenance, except for
      the completion of some projects already in progress (such
      as the Venetia Underground project).

   -- Modest dividends toward the end of 2017 and more
      substantial distributions starting 2018.

Given the uncertainty around the potential dividends in 2017 and
in 2018, the company's adjusted FFO to debt could fall within a
wide range.  For example, if Anglo pays no dividends, the
adjusted FFO to debt under the proportional consolidation
approach would be around 60% in 2017 and around 70% in 2018.  On
the other hand, assuming that the company maintains net debt of
EBITDA of 1.0x, while distributing its excess cash, the adjusted
FFO to debt using the proportional consolidation approach would
be between 50%-55% in both years.

Given the material number of minority shareholders in Anglo's
structure (notably in South Africa and Chile), S&P considers that
a proportional consolidation approach--that is, excluding the
assets, liabilities, and cash flows associated with minorities
from Anglo's account, S&P continues to see the adjusted FFO-to-
debt (under proportional consolidation approach) as the more
accurate approach to monitor the company's credit metrics.  For
example, the adjusted FFO to debt as of Dec. 31, 2016 was about
40%, compared with 32% under the proportional consolidation
approach.

"We view Anglo's business risk profile as satisfactory.  This
assessment balances Anglo's strong competitive position in
certain commodities, which is supported by its diversified and
long-life assets, against its scale and overall EBITDA compared
with its larger peers.  Other factors include the company's
significant exposure to country risk in South Africa and the
cyclicality of the mining industry.  We take a positive view of
the company's improved profitability, stemming from its cost-
cutting initiatives and divestment of less-competitive assets.
Over the medium term, we could revise Anglo's business risk
profile upward if it is able to present improved EBITDA margins
that are more comparable with its stronger peers and if we have
better visibility on its long-term portfolio," S&P said.

The positive outlook reflects a one-in-three probability that S&P
will raise the ratings on Anglo American to 'BBB-' from 'BB+' in
the next 12 months.

An upgrade is contingent on Anglo establishing a longer track
record consistent with recent decisions, notably expanding its
core portfolio to include the iron ore and coking coal assets.
It also depends on the implementation of its financial policy,
including targeting net debt to EBITDA for the group between
1.0x-1.5x and establishing a new dividend policy.

In S&P's view, an upgrade should also be supported by one of
these:

   -- FFO-to-debt ratio above 45% (using proportional
      consolidation) on average through the cycle.  Based on
      S&P's base-case scenario, the company is likely to meet
      this condition already in 2017.  An improvement in the
      competitive position of the mining assets, reflected also
      by EBITDA margins that are more comparable with its
      stronger peers.

S&P would consider revising the outlook to stable if the FFO-to-
debt ratio using our proportional consolidation approach fell
below 40% on average through the cycle.  This could occur if the
Chinese economy experienced a more pronounced slowdown, compared
to S&P's base case, and this had a direct impact on the prices of
key commodities such as iron ore, diamonds, and coal.

In addition, the divestment of key assets from Anglo's portfolio
not accompanied by improved credit metrics could make an upgrade
less likely.  S&P would assess the impact of any such sale on
Anglo's business risk profile and the potential volatility of
cash flows.  S&P would likely consider it detrimental to the
ratings on Anglo in this respect if the company decided to spin
off the Kumba Iron Ore assets to its shareholders without a
proportional decrease in debt.


BHS: Princes St. Site Could be Transformed Into a Hotel
-------------------------------------------------------
Kaye Nicolson at STV News reports a flagship Princes Street
building could be transformed into a hotel, restaurant and shops
under ambitious plans, which could create around 250 jobs.

The owners of the property, which currently houses BHS, have been
inundated with interest in the site since the retailer went into
administration earlier this year, according to STV News.


CO-OPERATIVE BANK: Virgin Money Eyes Parts of Rival
---------------------------------------------------
Holly Williams at The Scotsman reports that challenger bank
Virgin Money has said it would look at potentially snapping up
parts of troubled rival Co-operative Bank as it revealed annual
profits leapt by a third.

According to The Scotsman, Jayne-Anne Gadhia, chief executive of
the Edinburgh-headquartered lender, said the Co-op Bank sale was
a "strategic opportunity", but added Virgin Money had not yet
made any approach.

Co-op Bank, which has four million customers, was put up for sale
earlier this month amid mounting concerns over its capital
position, The Scotsman recounts.

It has struggled to recover after its near-collapse in 2013
following the discovery of a GBP1.5 billion black hole in its
finances and it was forced into a painful debt for equity swap,
which left it majority controlled by US hedge funds, The Scotsman
relays.  It is not clear if Virgin Money would be interested in
buying all or part of Co-op Bank, The Scotsman notes.

The Co-operative Bank is a retail and commercial bank in the
United Kingdom, with its headquarters in Balloon Street,
Manchester.


FLITCRAFT ECOBUILD: In Administration, 25 Jobs at Risk
------------------------------------------------------
Construction Enquirer reports an eco-friendly homes business
owned by former Premiership footballer Garry Flitcroft has fallen
into administration.

Flitcraft Ecobuild was set-up by the ex-Manchester City and
Blackburn Rovers star in 2014.

Timber frame specialist has a factory in Preston and employed 25
staff.

Construction Enquirer, citing Lancashire Telegraph, relates said
administrators from Refresh Recovery Ltd are now running the
business.

The report relays that administrator Peter Harold told the
Lancashire Telegraph: "It is early days and we are still
examining the assets of the business.

"Early next week, we will be making a decision on how best to
market the company."


PREMIERTEL PLC: S&P Affirms 'BB' Rating on Class B Notes
--------------------------------------------------------
S&P Global Ratings affirmed its credit ratings on Premiertel
PLC's class A and B notes.

The affirmations follow S&P's review of the transaction under its
European commercial mortgage-backed securities (CMBS) criteria.

Premiertel is a single-loan transaction secured on five U.K.
office properties let to British Telecommunications PLC (BT).
The transaction closed in November 2003.  Two of the properties
are in England, two in Scotland, and one in Northern Ireland.
The properties were all built between 1998 and 2001.  All five
properties are currently let to BT on full repairing and insuring
leases, which expire in 2032.

The transaction was designed to fully amortize from BT's periodic
rental payments.  The loan's maturity date and the leases' expiry
dates are in 2032.  The class A bonds are scheduled to fully
amortize by 2029, and the class B bonds by 2032.

The issuer is currently not fully paying the scheduled
amortization payments to the class B bonds.  This is because the
issuer is paying prior-ranking expenses, which are higher than
originally anticipated, and receives lower-than-anticipated
interest from deposited amounts.  As a result, the amount left
available is insufficient to meet the scheduled amortization
payments on the class B bonds.  This does not trigger a loan or a
note payment default.

The transaction does not have a tail period (i.e., a period
between a loan's maturity date and transaction's legal final
maturity date).  The tail period enables enforcement action and
recovery on any security prior to legal final maturity if a loan
fails to repay at maturity.  As a result, S&P believes that if
the borrower fails to repay at loan maturity, the class B bonds
could default.

                          RATING ACTIONS

S&P's ratings in this transaction address the timely payment of
interest and repayment of principal no later than the legal final
maturity date in August 2029 for the class A bonds, and May 2032
for the class B bonds.

Following S&P's review of the transaction, it considers the
available credit enhancement for the class A bonds to be
sufficient to mitigate the risk of losses from the underlying
loan in a 'AA' rating stress scenario.  S&P has therefore
affirmed its 'AA (sf)' rating on the class A notes.

S&P's 'BB (sf)' rating on the class B bonds already reflects the
transaction's payment default risk at legal maturity.  S&P has
therefore affirmed its 'BB (sf)' rating on the class B bonds.

RATINGS LIST

Class            Rating

Premiertel PLC
GBP286.207 Million Fixed-Rate Bonds

Ratings Affirmed

A                AA (sf)
B                BB (sf)


STONEGATE PUB: Moody's Affirms B2 Corporate Family Rating
---------------------------------------------------------
Moody's Investors Service affirmed Stonegate Pub Company Limited
corporate family rating (CFR) of B2 and probability of default
rating (PDR) of B2-PD. Concurrently, Moody's has also assigned a
B2 (LGD 3) rating on the new GBP395 million senior secured fixed
rate notes due 2022 and on the new GBP190 million senior secured
floating rate notes due 2022. This follows the company's
announcement that it intends to raise GBP585 million to refinance
the existing GBP480 million senior secured notes, as well as to
fund a GBP42 million dividend and return GBP41 million capital
invested by the parent in the Company.

The ratings on the existing notes will be withdrawn upon
repayment. The outlook on all ratings remains stable.

RATINGS RATIONALE

"Moody's decision to affirm Stonegate's CFR reflects the
company's improved EBITDA achieved over the last twelve months,
good top line growth resulting from new sites acquisitions as
well as above market like-for-like (LFL) sales growth, and
improved EBITDA margins, which balance the debt increase in the
context of the notes refinancing," says Emmanuel Savoye, an AVP
at Moody's.

The improved EBITDA was driven by (1) continued good sales
performance with group LFL sales growth of 3.0% in FY2016 (ending
September 2016) compared to 1.2% the previous year; (2) higher
margins due to better sales mix and pricing initiatives; and (3)
the successful integration of newly acquired businesses. As a
result, reported revenues and company reported adjusted EBITDA
increased by 14.4% and 22.3% respectively in FY2016 compared to
the previous year, while the company reported adjusted EBITDA
margin increased to 14.9% from 14%.

Liquidity is expected to remain adequate for the company's
ongoing operational requirements. However, Moody's expects
limited free cash flow generation due to ongoing investment in
acquired sites. A new GBP50 million revolving credit facility
with extended maturity in 2021 will further support liquidity.
There is sufficient headroom under the RCF minimum EBITDA
maintenance covenant. The refinancing will also allow to extend
the debt maturity profile to 2021-2022 and lower the overall cost
of debt.

Pro-forma for the refinancing Moody's adjusted leverage will
increase temporarily to 7.2x from 6.4x as of FY2016. However,
when taking into account the positive contribution of
acquisitions to EBITDA made in late 2016 as well as organic
growth, Moody's expects Moody's adjusted leverage to reduce to
6.8x by year-end 2017, within Moody's guidance for the B2 rating.

STRUCTURAL CONSIDERATIONS

The B2 ratings of the senior secured notes are in line with the
B2 CFR, given that both notes rank pari passu amongst each other.
However, Moody's note that the notes rank behind the unrated
super senior GBP50 million RCF upon enforcement. The bonds are
secured pari passu with respect to Stonegate's freehold and
certain leasehold assets, which provide additional support for
bondholders. Stonegate's portfolio of 689 pubs as of February
2017 includes a significant 64% value in freehold and long
leasehold properties.

OUTLOOK

The stable rating outlook reflects Stonegate's success to date in
acquiring and integrating a material portfolio of pubs throughout
the UK while improving margins. Moody's expects the company to
continue showing moderately improving interest coverage and
leverage trends over time.

WHAT COULD CHANGE THE RATING UP/DOWN

Upward pressure on the rating could materialise if the company
achieves a sustained improvement in interest coverage closer to
1.8x and leverage sustainably below 6.0x combined with
consistently positive free cash flows ("FCF") and good liquidity.

Conversely, downward pressure on the rating could arise: (1)
following a weakening in performance such that interest coverage
falls well below its current 1.3x level, or if leverage is
sustained above 7.0x; or (2) in case of persistently negative FCF
and weak liquidity.

PRINCIPAL METHODOLOGY

The principal methodology used in these ratings was Restaurant
Industry published in September 2015.

Stonegate is the largest privately held managed pub company in
the UK with 654 pubs under management as of FY2016. Stonegate is
controlled by TDR Capital, a private equity firm founded in 2002
with over EUR4.0 billion of AUM. Stonegate was formed through a
series of acquisitions: Mitchell & Butler's in 2010, Town & City
in 2011, Living Room and Bramwell in 2013, and more recently TCG
in 2015 and Intertain in 2016. The portfolio operates a number of
brands encompassing high street, suburban, student, local and
late night venues concepts. Stonegate benefits from an
experienced management team with deep roots in the pub business
and over 20 years of experience on average.


                            *********

Monday's edition of the TCR delivers a list of indicative prices
for bond issues that reportedly trade well below par.  Prices are
obtained by TCR editors from a variety of outside sources during
the prior week we think are reliable.  Those sources may not,
however, be complete or accurate.  The Monday Bond Pricing table
is compiled on the Friday prior to publication.  Prices reported
are not intended to reflect actual trades.  Prices for actual
trades are probably different.  Our objective is to share
information, not make markets in publicly traded securities.
Nothing in the TCR constitutes an offer or solicitation to buy or
sell any security of any kind.  It is likely that some entity
affiliated with a TCR editor holds some position in the issuers'
public debt and equity securities about which we report.

Each Tuesday edition of the TCR contains a list of companies with
insolvent balance sheets whose shares trade higher than US$3 per
share in public markets.  At first glance, this list may look
like the definitive compilation of stocks that are ideal to sell
short.  Don't be fooled.  Assets, for example, reported at
historical cost net of depreciation may understate the true value
of a firm's assets.  A company may establish reserves on its
balance sheet for liabilities that may never materialize.  The
prices at which equity securities trade in public market are
determined by more than a balance sheet solvency test.

Each Friday's edition of the TCR includes a review about a book
of interest to troubled company professionals.  All titles are
available at your local bookstore or through Amazon.com.  Go to
http://www.bankrupt.com/booksto order any title today.


                            *********


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.
Valerie U. Pascual, Marites O. Claro, Rousel Elaine T. Fernandez,
Joy A. Agravante, Julie Anne L. Toledo, Ivy B. Magdadaro, and
Peter A. Chapman, Editors.

Copyright 2017.  All rights reserved.  ISSN 1529-2754.

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Information contained herein is obtained from sources believed to
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