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        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

            Tuesday, August 1, 2017, Vol. 18, No. 151


                            Headlines


B E L G I U M

IDEAL STANDARD: Fitch Assigns CCC Rating to AAA Series Notes


C R O A T I A

ZAGREBACKI HOLDING: S&P Affirms 'BB-' CCR, Outlook Stable


C Z E C H   R E P U B L I C

AVAST HOLDING: Moody's Revises Outlook to Neg, Affirms Ba3 Rating


F R A N C E

BANIJAY GROUP: S&P Assigns 'B+' CCR, Outlook Stable


G E R M A N Y

HECKLER & KOCH: S&P Places 'CCC+' CCR On CreditWatch Positive
K+S AG: Egan-Jones Cuts Senior Unsecured Ratings to BB+


I R E L A N D

DECOBAKE: Provisional Liquidator Seeks Buyer for Business
GLG EURO CLO III: Moody's Assigns B2(sf) Rating to Class F Notes
GLG EURO CLO III: S&P Assigns B- (sf) Rating to Class F Notes
M J WALLACE: October 9 Hearing Set for Case Against Directors


I T A L Y

BANCA MONTE: Italy Sets Share Price for Capital Increase


N E T H E R L A N D S

KRATON POLYMERS: Moody's Rates New Euro 1st Lien Term Loan Ba3


R U S S I A

BRUNSWICK RAIL: S&P Affirms Then Withdraws 'CC' Long-Term CCR
METALLOINVEST JSC: S&P Affirms 'BB' CCR, Outlook Stable
SERGEY POYMANOV: PPF's Request to Admit Gureev Evidence Denied


S P A I N

BANCO POPULAR ESPANOL: Egan-Jones Withdraws C Sr. Unsec. Ratings
BANKIA SA: Moody's Rates EUR750MM Tier 1 Preferred Sec. B2(hyb)
BANKIA SA: Moody's Assigns (P)Ba3 Rating to Medium Term Note


U N I T E D   K I N G D O M

ALBA 2007-1: Fitch Corrects June 15 Rating Release
MARKS & SPENCER: Egan-Jones Lowers Sr. Unsecured Ratings to BB+
NOBLE CORP: Egan-Jones Lowers LC Sr. Unsecured Rating to BB-
PAYSAFE GROUP: S&P Places 'BB' CCR on CreditWatch Negative
RED PHARMA: Expects to Exit Administration After BTK Program Sale

* UK: Firms in Significant Financial Distress Up 25% in 2Q 2017


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B E L G I U M
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IDEAL STANDARD: Fitch Assigns CCC Rating to AAA Series Notes
------------------------------------------------------------
Fitch Ratings has assigned bathroom ceramics and fittings
producer Ideal Standard International SA's (ISI) AAA series notes
a final rating of 'CCC'/'RR2'/90%. The final rating follows the
receipt of documents conforming to information already received
and is in line with the expected rating.

KEY RATING DRIVERS

Above-Average Recovery Prospects: Fitch expects above-average
recoveries for the AAA series noteholders in the case of default.
Fitch estimates that the going-concern approach will lead to a
higher recovery for creditors versus balance-sheet liquidation in
a situation of financial distress under its bespoke recovery
analysis. This reflects the group's improved operating cost
structure post restructuring.

Fitch uses a 35% discount to the most recent last-twelve-months'
(LTM) EBITDA to estimate the group's post-distress EBITDA as a
cash-flow proxy required for the company to continue operating as
a going concern. Fitch apply a multiple of 5.0x to Fitch
distressed EV/EBITDA, which reflects ISI's earnings volatility
from its exposure to construction cycles and capital-intensive
production, particularly in the ceramics business. Fitch also
deduct 10% for administration charges, the remainder being the
value available for distribution to senior secured creditors.

AAA Notes Capped at 'RR2': The rating of the AAA series notes is
capped at 'RR2' in accordance with Fitch's "Country-Specific
Treatment of Recovery Ratings", October 2016. This is due to
ISI's exposure to MENA, eastern Europe, Italy and France, which
Fitch considers less creditor-friendly and where security is less
enforceable than is commensurate with 'RR1'.

Liquidity Relief: The issuance of the EUR75 million series AAA
notes to sponsors and the refinancing of EUR25 million RCF now
maturing April 2018 removes short-term liquidity pressures. It
funds part of the 2016-2018 business plan. However, leverage and
refinancing risks remain high, as the group's debt matures in
2018.

Trading As Expected: ISI's current trading for the year to date
(YTD) 1Q17 is in line with Fitch's expectations, despite adverse
FX and raw material effects. Fitch forecasts modest revenue
growth and flat to improving margins in 2017, driven by
recovering construction activity in the UK, Germany, Italy and
France, which together comprise nearly two-thirds of ISI's
revenues. Fitch expects the pace of margin expansion to slow in
2017 from raw material cost inflation, including for zinc and
copper.

Unsustainable Capital Structure: ISI's unsustainable leverage and
excessive refinancing risks constrain the ratings, despite an
improvement in FFO. Fitch Ratings expects FFO adjusted gross and
net leverage to remain in the double digits until the maturity of
the senior secured notes in 2018, as the new AAA EUR75 million
notes issuance and PIK interest on its existing debt have
increased ISI's debt burden. Free cash flow (FCF) is likely to
remain neutral to negative, hampering a reduction in leverage and
constraining liquidity.

DERIVATION SUMMARY

Ideal Standard International SA's (ISI) rating of 'CC' is
constrained by unsustainably high leverage and excessive
refinancing risks. ISI's brands and market positions are good. It
ranks among the top-three competitors in each national market and
counts Sanitec, Masco, Grohe and Roca among its direct peers. Its
broader product spectrum compared with peers benefits the group
in markets, where customers prefer to have a single supplier. The
group also completed a multi-year restructuring programme. This
improved the cost structure of its operations, which historically
lagged peers.

KEY ASSUMPTIONS

Fitch's key assumptions within Fitch ratings case for the issuer
include:
- modest revenue growth driven by slow recovery in end-markets.
- flat-to-improving margins from improved capacity utilization
   and lower production costs, although at a slower pace due to
   raw material price inflation;
- increasing leverage from PIKing capital structure.

KEY RECOVERY RATING ASSUMPTIONS

- The recovery analysis assumes that ISI would continue as a
going concern in bankruptcy and that the company would be
reorganised rather than liquidated. This reflects the group's
improved operating cost structure, following its operational
restructuring. Fitch assumed a 10% administrative claim.

- ISI's going concern EBITDA is based on LTM March 2017 EBITDA,
excluding the 40% of MENA EBITDA. Fitch strips out this portion
from group EBITDA, because ISI's economic interest in MENA is
limited to 60%. The going-concern EBITDA reflects Fitch's view of
a sustainable, post-reorganisation EBITDA level upon which Fitch
base the valuation of the company. The going-concern EBITDA is
35% below LTM EBITDA and reflects a potential recession in ISI's
core construction markets and failed product launches in a
competitive market.

- An EV multiple of 5x is used to calculate a post-
reorganisation valuation and reflects a low-cycle multiple. Fitch
uses multiples ranging from 4x to 5.5x for the building materials
and products sector.

- The EUR25 million RCF is assumed to be fully drawn in its
recovery analysis, as RCFs are tapped when companies are in
distress. The waterfall includes around EUR25 million of local
credit facilities at non-guarantor level (Egyptian, Bulgarian and
others), which are structurally senior to the notes and EUR4
million finance leases and a factoring facility which Fitch
estimates is on average drawn by EUR19 million.

- The waterfall results in a 97% recovery corresponding to 'RR1'
recovery for the Series AAA Notes (EUR75 million). ISI has assets
in multiple jurisdictions so Fitch performs a country cap
analysis. The result is a country cap at RR2/90%, which Fitch
apply to the series AAA notes' rating.

RATING SENSITIVITIES

Future Developments That May, Individually or Collectively, Lead
to Positive Rating Action
- Significant margin improvement, with sustainable positive FCF
   and material deleveraging leading to a manageable capital
   structure.

Future Developments That May, Individually or Collectively, Lead
to Negative Rating Action
- Imminent default from inability to service near-term interest
   or principal maturity, or further debt restructuring measures.

LIQUIDITY

Adequate Liquidity: Liquidity is sufficient, following the EUR75
million issuance of the series AAA notes and the extension of its
EUR25 million RCF maturity to March 2018 from April 2017.
Unadjusted cash amounted to EUR88 million at end-1Q17 and the
group's EUR25 million super senior RCF was undrawn. Together with
the new series AAA notes, this is sufficient to cover EUR30
million in intra-year working capital swings and the remaining
EUR48 million of short-term debt, following the extension of the
RCF maturity.



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ZAGREBACKI HOLDING: S&P Affirms 'BB-' CCR, Outlook Stable
---------------------------------------------------------
S&P Global Ratings said it has affirmed its 'BB-' long-term
corporate credit rating on Croatia-based Zagrebacki Holding
d.o.o. (ZGH). The outlook remains stable.

S&P said, "The affirmation reflects our base-case forecast that
S&P Global Ratings' adjusted debt to EBITDA will remain stable at
about 5.2x-5.4x as we do not expect deleveraging or significant
amounts of new debt issuances. ZGH recently redeemed its euro-
denominated Eurobond and issued a second tranche of domestic
bonds worth Croatian kuna (HRK) 500 million by year-end 2017. We
continue to view ZGH's financial risk profile as aggressive.
Although we forecast funds from operations (FFO) to debt to
gradually improve to 15% in 2019, we think challenges in the gas
segments will persist and performance volatility will limit any
significant upside in our core metrics. We expect FFO to debt to
remain in the lower end of the range of our financial risk
assessment. We forecast increasing capital expenditure (capex),
at an average of HRK680 million between 2017 and 2019, which we
understand that the company plans to fund through cash, EU grants
(HRK180 million), and subsidies from the City of Zagreb. We also
forecast a moderate increase in debt to fund capex and liquidity
needs. However, this does not worsen our debt to EBITDA and FFO
to debt metrics.

"We understand that there have been conversations between the
city and ZGH to remove the transport company from the Holding,
however, there is still no clear timeline. The transport company,
which accounts for about 20% of consolidated revenues, is loss-
making and has a history of regularly receiving subsidies in
excess of its turnover. In 2016, the transport company had
revenues of HRK484 million and received a subsidy of about HRK500
million. Subsidies for the transport company will increase by an
additional HRK100 million in 2017.

"In addition to the water company, the generally weak
profitability of the transport segment will drag on the
financials of ZGH as a whole. If the transport company were to be
transferred out of the Holding, the impact would likely be
beneficial for ZGH as it could increase its net income by roughly
5x. That said, we will need to review the likelihood that the
City of Zagreb will provide extraordinary state support due to
the essential, and therefore heavily subsidized, service provided
by the transport company.

"ZGH's weak business risk profile reflects the relatively
unpredictable cash flows arising from the frequent change in
tariffs, and generally weak operating efficiency in companies
that are large contributors to revenue. This in turn affects
profitability and volatility, which we view as high for ZGH.
Although ZGH benefits from leading market positions in many of
the services it provides within Zagreb, this is to some extent
offset by its lack of insulation from political decisions and
external factors. There have been frequent changes in water
tariffs over the years, for instance, which limits tariff
visibility, and hence predictability (the water supply company
accounts for about 10% of turnover). Even with gas distribution,
which is regulated by the Croatian Regulatory Energy agency (HERA
is considered to act independently and transparently), the
business environment remains challenging since HERA decreased
tariff items by approximately 38% relative to 2015 prices. This
has affected the bottom line of its two gas subsidiaries
(distribution and supply) which contribute approximately 25% of
revenues and EBITDA."

The business risk profile benefits from the fact that ZGH
provides diversified services in one of the richest regions of
Croatia. Management is also increasingly focusing on
restructuring measures to tighten cost controls and capture
efficiency gains through workforce education, gradual staff
reduction, and digitalization. However, the potential
contribution toward the bottom line remains limited in the
context of the subsidies the city needs to provide to ZGH.

S&P's base case assumes:

-- Croatia's real GDP forecast at 2.8% in 2017, 2.6% in 2018,
    and 2.5% in 2019.
-- S&P assumes that the transport company will remain in ZGH and
    will continue to receive subsidies from the City of Zagreb in
    the amount of HRK500 million.
-- The transport company and all other non-affiliates equate to
    approximately 48% of consolidated revenues.
-- S&P forecasts EBITDA margins at 15% for the transport company
    and nonaffiliate companies.
-- S&P expects continued headwinds in the gas sector, with no
    rebound in tariff prices, forecasting 46% EBITDA margins for
    the gas distribution company and 6% for the gas supply
    company over its forecast time horizon.
-- The water treatment and distribution company is relatively
    stable and we expect stable EBITDA margins at 38% going
    forward.
-- S&P forecasts a capex increase to an average of HRK680
    million in 2017-2020 from HRK250 million in 2016. However,
    with EBITDA values forecast at about HRK840 million and the
    receipt of additional EU and Croatian funds, we do not see
    any liquidity constraints.
-- S&P assumes that in a possible downside scenario, with
    substantially lower turnover and EBITDA, ZGH would also
    adjust its capital program, with the transport company still
    receiving subsidies from the city.

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

-- Debt to EBITDA of 5.2x-5.5x between 2017 and 2019;
-- FFO to debt of 13.8% on average between 2017 and 2019; and
-- Broadly neutral free operating cash flows to debt.

The long-term rating on ZGH is derived from its stand-alone
credit profile (SACP) of 'b', reflecting its weak business risk
profile and aggressive financial risk profile. ZGH benefits from
a two-notch uplift as S&P thinks that ZGH has a very high
likelihood of receiving extraordinary government support based on
its: Very important role. ZGH contains all the municipal
companies which provide the necessary services for the proper
functioning of the city. These services range from
transportation, gas distribution, water supply, and waste
collection, to name a few. As such, ZGH also acts as the channel
through which the city can implement its investment program,
particularly when considering that the city faces strict legal
restrictions regarding how much debt it can take.

Very strong link with the city of Zagreb. ZGH has independent
management teams for each company which are, in turn, supervised
by the board. However, Mr. Milan Bandic, the Mayor of Zagreb,
still wields considerable influence on the strategy of ZGH as
exemplified by the fact that he nominated key board members. We
do not see the link between the city and ZGH diminishing in the
future. In the short-to-medium term, ZGH can only thrive through
its long-term contractual relations with the city and the
subsidies it provides, which create a quasi-monopoly position in
the provision of essential public services. We will review the
likelihood of extraordinary state support if Zagreb takes over
the transport function, which we view as providing an essential
service for the city. The stable outlook reflects the outlook on
the City of Zagreb, itself mirroring that on Croatia. S&P
believes that FFO to debt will remain at about 13%-15% and that
liquidity will remain adequate, even without any changes to the
ownership of transport company ZET.

An upgrade of ZGH over the next two years could occur through a
noticeably better performance in the FFO to debt metric (above
20%); a change in the structure of the company and its operating
efficiency, resulting in a better competitive position; or an
upgrade of Zagreb by two notches. S&P said, "However, we view all
of these scenarios as unlikely. We do not disregard the
possibility that the transport company could be moved out of ZGH
before year-end 2019, resulting in much stronger metrics.

"We could downgrade ZGH following a downgrade of the City of
Zagreb or as a result of FFO to debt falling below 12%. We would
also view any accumulation of debt to offset negative liquidity
pressures as negative for the creditworthiness of ZGH. In our
view, this is the most likely downside scenario as ZGH currently
has an ambitious capex program and is facing challenges in the
business environment which could possibly further compress
EBITDA."


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AVAST HOLDING: Moody's Revises Outlook to Neg, Affirms Ba3 Rating
-----------------------------------------------------------------
Moody's Investors Service has changed the outlook on all of the
ratings of Czech security software provider Avast Holding B.V.
(Avast) and its rated subsidiaries to negative from stable
following the launch of $105 million of incremental term loans to
fund the acquisition of Piriform.

The outlook change was driven by:

-- Delay in deleveraging profile versus Moody's original
   expectations for 2017

-- More aggressive financial policy than anticipated at the time
   of the AVG acquisition

Concurrently, Moody's has affirmed all of Avast's Ba3 ratings.

RATINGS RATIONALE

The outlook change reflects Moody's expectation that the
conditions for a stable outlook will not be met by year-end 2017.
The rating agency forecasts that Moody's adjusted leverage will
remain above 4.0x instead of declining towards 3.5x. In addition,
the additional debt raise following the acquisition of Piriform
demonstrates a more aggressive financial policy which also leads
to free cash flow (FCF)/debt not being comfortably above 10% in
2017.

"The negative outlook reflects the delay in Avast's deleveraging
compared to Moody's expectations at the time of the acquisition
of AVG" says Frederic Duranson, a Moody's Analyst and lead
analyst for Avast. "The rating action also takes into account the
shift in priorities for the use of cash away from delevering the
balance sheet" Mr Duranson adds.

Moody's expects that Avast's adjusted debt/EBITDA (excluding
unrestricted subsidiaries and including the contribution from
Piriform) will stand at approximately 4.2x at the end of 2017.
This represents a delay in the deleveraging profile of the group,
whose stable outlook was predicated upon Moody's adjusted
leverage declining towards 3.5x within 18 months of the
acquisition of AVG i.e. at the end of 2017. Whilst Moody's
continues to expect that EBITDA will be broadly in line with its
original forecasts, Avast will not meet the rating agency's
leverage expectations in 2017 owing to the debt additions made so
far this year, worth approximately $180 million (including the
proposed incremental term loans and before mandatory debt
amortisation).

The incremental debt raised by Avast in 2017 and the decision not
to use the large available cash balance to repay debt reflects a
more aggressive financial policy than was pursued by the group
before its acquisition of AVG and the anticipated uses of cash at
the time of this transformative transaction. However, Piriform
generated approximately $12 million of cash EBITDA in the last 12
months to June 2017, so that this acquisition alone increases
adjusted leverage by around 0.2x.

Certain areas of the legacy AVG, such as the corporate and search
businesses, which are experiencing structural issues, have
trailed Moody's forecasts since the acquisition and the rating
agency also expects slightly lower growth in Mobile owing to
slower new customer acquisition in the carrier business. However,
Moody's original revenue forecasts remain valid overall as the
largest segment, Consumer, is ahead of its expectations on
continued strong performance from utility and encryption
products.

In addition, management expects that in-year cost synergies will
be in line with its forecasts for 2017 and integration costs will
be broadly in line as well, demonstrating that execution is on
track and on budget. This removes much of the execution risk
attached to this transformative acquisition, although the
implementation of key initiatives, such as the migration of AVG
paid users onto the Avast technology platform and further
employee reductions, still needs to be completed before the end
of the year.

Moody's considers that Piriform is a good fit for Avast, given
its shared characteristics such as its freemium model with viral
marketing and very low maintenance, leading to very high
profitability (around 60% EBITDA margin) and cash conversion. The
acquisition will increase the group's user base by around 130
million or 30% and rebalance its consumer offering with utilities
such as performance optimisation products increasing their
contribution relative to antivirus products. The partial lack in
overlap between the user base of Avast and CCleaner, Piriform's
flagship product, provides cross-selling opportunities to the
group. However, Moody's highlights that revenue synergies often
take longer to materialise than cost synergies and cautions
against the risk of cannibalisation between Avast's and
Piriform's performance optimisation products should they not be
differentiated enough or customers chose to rationalise their
usage to fewer products.

Moody's forecasts free cash flow (after interest) in the range of
$170-$180 million in 2017. Adjusted for approximately $60 million
of one-off costs related to the acquisition (e.g. squeeze out and
severance costs), it will be just shy of Moody's original
expectation for 2017 but will benefit from the reduced interest
bill (even after debt additions) following the re-pricing
executed in March 2017, and the cash flow contribution from
Piriform. As a result, Moody's expects that FCF/debt will be
around 9-10% in 2017 (11-12% before one-off items).

Moody's views Avast's liquidity profile as very good. It will be
supported by a sizeable cash balance of approximately $300
million after this transaction and full availability under the
$85 million revolving credit facility (RCF) maturing in 2021.
Avast's strong cash flow generation further boosts liquidity, in
spite of the AVG integration costs. The credit facilities are
covenant-lite, with only a springing net first lien leverage
covenant on the RCF, to be tested only if it is drawn by $25
million or more.

RATIONALE FOR NEGATIVE OUTLOOK

The negative outlook reflects Avast's delayed deleveraging
following the acquisition of AVG in July 2016 and the risk that
its adjusted leverage will not fall towards 3.5x in the next 12
months, including as a result of a more aggressive financial
policy.

WHAT COULD CHANGE THE RATING UP/DOWN

In light of the negative outlook, an upgrade is unlikely at this
stage. However, Moody's could stabilise the outlook on the
ratings if Avast's adjusted leverage fell towards 3.5x and
FCF/debt was maintained well above 10%, coupled with a solid
liquidity profile and a demonstrated conservative financial
policy.

Avast's ratings could be downgraded if (1) the paid user base
declined on a sustainable basis; (2) further debt-funded
acquisitions or lack of earnings growth led to adjusted leverage
failing to move towards 3.5x and (3) FCF/debt not materially
above 10%.

LIST OF AFFECTED RATINGS

Affirmations:

Issuer: Avast Holding B.V.

-- LT Corporate Family Rating, Affirmed Ba3

-- Probability of Default Rating, Affirmed Ba3-PD

Issuer: Avast Software B.V.

-- Senior Secured Bank Credit Facility, Affirmed Ba3

Outlook Actions:

Issuer: Avast Holding B.V.

-- Outlook, Changed To Negative From Stable

Issuer: Avast Software B.V.

-- Outlook, Changed To Negative From Stable

PRINCIPAL METHODOLOGY

The principal methodology used in these ratings was Software
Industry published in December 2015.

CORPORATE PROFILE

Avast Holding B.V. (Avast) was founded in 1988 in the Czech
Republic and has grown to become a global provider of security
software -- primarily focused on the consumer (including mobile)
market with small business clients as well. The company has
developed strong positions globally and is one the world's
largest online service companies in terms of installed user base,
which includes approximately 570 million protected devices
(including Piriform users) as of June 2017. For the last twelve
months to June 2017, the company reported revenue of $730 million
and an EBITDA of $394 million. Avast is 41% owned by funds
advised by CVC Capital Partners, with the founders, Summit
Partners, management and employees holding the balance.


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BANIJAY GROUP: S&P Assigns 'B+' CCR, Outlook Stable
---------------------------------------------------
S&P Global Ratings assigned its 'B+' long-term corporate credit
rating to French TV production company Banijay Group SAS. The
outlook is stable.

S&P said, "We also assigned our 'B+' issue rating to the group's
EUR365 million senior secured notes, the EUR60 million term loan
A, and the EUR35 million revolving credit facility (RCF). The
recovery rating on this debt is '3', indicating our expectation
of meaningful recovery in the 50%-70% range (rounded estimate:
65%) in the event of a payment default.

"Our rating reflects our stand-alone credit profile (SACP) of
'bb-' on Banijay and our view that the credit quality of the
group's controlling shareholder caps the rating at 'B+'."

The group operates in the competitive and fragmented film and
television programming industry, and is exposed to the inherent
volatility of viewers' tastes. Demand and pricing for Banijay's
content are linked to the broadcasters' performance. Broadcasters
are currently undergoing structural changes due to audience
fragmentation and new entrants, while they remain exposed to
cyclical spending on advertising. S&P said, "Our assessment of
Banijay also reflects the group's relatively small size -- with
pro forma revenues of about EUR0.8 billion in 2016 -- compared
with other TV producers such as Endemol Shine (EUR1.9 billion) or
Fremantle (EUR1.6 billion). Also, we understand that one of the
rationales for the merger with Zodiak Media in 2016 was to
reinforce Banijay's library of scripted content, but the latter
is typically less profitable than nonscripted shows. The
development of scripted formats over the coming years, driven by
increasing demand for high-quality drama in particular, could
weigh on the EBITDA margin and working capital, due to the longer
production cycle and more-capital-intensive nature of scripted
shows versus nonscripted shows. However, we understand scripted-
show revenues should not exceed 20% of total revenues over the
long term, compared with 11% in 2016.

"Our rating on Banijay also reflects the group's strong positions
in its key markets: France, the U.S., and the Nordics, where it
generated more than 60% of its revenues in 2016. Banijay is an
independent TV production group with a diversified library of
over 500 formats and more than 20,000 hours of catalogue content
across numerous genres. One of the key strengths of Banijay is
its successful creative talent retention, with a very high
retention rate, which preserves independence and entrepreneurial
spirit. We also factor in the predictability of the group's cash
flows, with 84% of revenues already contracted for 2017, mainly
due to contracts signed early in the production process and
coming from returning seasons of successful shows. A key feature
of Banijay's business model is also its pre-funding model where a
majority of the shows are pre-financed by the broadcasters, which
allows the group to have more flexibility on its cost base.
Lastly, the bulk of Banijay's revenues are derived from
nonscripted shows and daily shows which, together with tight cost
control, allows the group to report an S&P Global Ratings-
adjusted EBITDA margin of above 12%, which is in line with our
estimate of the industry average and above that of certain peers,
such as Endemol Shine, All3Media, and Fremantle.

"Our rating is based on Banijay's new capital structure,
including the new EUR60 million term loan and EUR365 million
bond, whose proceeds will be used to repay the group's existing
debt of about EUR308 million and pay for the acquisition of
Castaway, which produces the show "Survivor" in the U.K. We
forecast that the group will have aggressive debt leverage over
the next couple of years. We project a ratio of S&P Global
Ratings-adjusted debt to EBITDA of between 4.5x and 5.0x in 2017,
reducing toward 4.0x in 2018. We include in our debt calculation
the earn-out and put option liabilities, but also the EUR25
million outstanding of a convertible bond provided by Vivendi and
issued at the Banijay Group Holding level. This instrument does
not meet our criteria for equity treatment. Our assessment of
Banijay's 'bb-' SACP is further supported by the company's
positive cash generation, which we expect to be to about EUR50
million annually.

"The stable outlook on Banijay reflects our expectation that in
the next 12 months, the group's adjusted debt to EBITDA will be
between 4.5x and 5.0x including the proposed transaction, and
will decline to about 4.0x by the end of 2018. The stable outlook
also captures our assumptions that the group's EBITDA growth will
be driven by a growing TV production market and the full
consolidation effect of acquisitions, while profitability will
slightly decline, owing to a growing share of revenues from
scripted shows. It also incorporates our view of the weaker
credit quality of Banijay's controlling shareholder, which leads
us to cap the rating at 'B+'.

"We could lower our rating on Banijay if its operating
performance falls materially below our expectations of 10% growth
in revenues and adjusted EBITDA margins of between 13% and 14%
for 2017 and 2018, resulting in an adjusted debt-to-EBITDA ratio
increasing to above 5.0x on a sustainable basis, and/or free
operating cash flow materially falling short of our forecast of
EUR40 million-EUR45 million for 2017. In addition, if we estimate
that the controlling shareholder's creditworthiness is
deteriorating following an increase in the group's debt or a
decline in the market value of its liquid investment, we could
also lower the rating.

"Upside is unlikely over the next 12 months. However, we could
raise our rating on Banijay if its performance and deleveraging
are stronger than our above-mentioned forecast, and at the same
time, we observe an improvement in the controlling shareholder's
credit quality."


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


HECKLER & KOCH: S&P Places 'CCC+' CCR On CreditWatch Positive
-------------------------------------------------------------
S&P Global Ratings placed its 'CCC+' long-term corporate credit
rating on German defense contractor Heckler & Koch GmbH on
CreditWatch with positive implications.

S&P said, "We also affirmed our 'CCC+' issue rating on the
company's senior notes. The recovery rating on the notes is
unchanged at '4', indicating our expectation of average recovery
prospects (30%-50%; rounded estimate: 30%) in the event of a
payment default.

"We will withdraw the issue and recovery ratings on the existing
senior secured notes once the transaction is completed.

"The CreditWatch placement reflects the likelihood that we would
raise the long-term rating on Heckler & Koch to 'B-' if the
company completes its plan to refinance EUR220 million existing
senior secured notes due in May 2018."

The company has already signed an agreement for EUR130 million
via direct lending and EUR40 million from a private placement.
Additionally, it received a EUR50 million injection from its
shareholders.

The company has not extended its EUR30 million revolving credit
facility (RCF) that expired June 30, 2017. However, under the
terms of each of the proposed debt facilities, given compliance
with certain conditions, the company has the option to draw down
an additional EUR20 million upon request. S&P said, "We see the
proposed transaction as a positive step by Heckler & Koch to
improve its debt maturity profile and financial flexibility. In
particular, we think that, if successful, the refinancing would
be favorable for the company's leverage and the sustainability of
its capital structure."

The company's business prospects improved in fiscal year 2016.
Heckler & Koch posted solid revenue growth in both the military
segment and the U.S. commercial market. Consequently, the
company's EBITDA margin increased to about 24% on a reported
basis. This is a strong recovery from the end of 2015, when the
company's operating performance was affected by changes in export
license policies. Improved profitability reflects management's
focus on process efficiencies and working capital management, and
was not dampened by any large, extraordinary write-downs.

S&P sai, "We expect the positive momentum to continue. We believe
that the company will be able to successfully execute its "green
countries" policy and limit its export license risk going
forward. This will provide more business stability and allow
Heckler & Koch to successfully execute its order book of EUR124
million as of December 2016 (excluding EUR90 million that we do
not expect to be delivered because of export license
restrictions) and translate it into stable revenues and sustained
profitability in 2017."

Given the continuing strong EBITDA and cash flow generation,
coupled with decreased leverage following the shareholder
injection, we now forecast the following pro forma S&P Global
Ratings-adjusted credit metrics for 2017:

-- Debt to EBITDA of 5.0x-5.2x; Funds from operations (FFO) to
    adjusted debt of about 9%; and
-- FFO interest coverage of 2.0x-2.4x.

S&P said, "Our view of the company's business risk profile
remains unchanged. The group's revenue exposure is focused on the
military and U.S. commercial segment, which is highly competitive
and subject to uncertainty regarding exporting policies. We view
positively the strategic decision to almost exclusively export to
low-risk countries that meet predefined criteria, such as an
anticorruption and democracy index. This will focus sales in
Europe and North America while business with other countries, in
particular the Middle East, is expected to be reduced to a
minimum. We believe that it will allow the company to further
stabilize its profitability and cash flow generation through
2017. We also acknowledge the new corporate structure with
improved corporate governance, introducing a clear separation of
duties for the executive board, supervisory board, and
shareholders."

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

-- Moderate revenue growth of 0%-5% per year for 2017 and 2018,
    supported by the execution of its existing order book
    (excluding EUR90 million that we do not expect to be
    delivered because of export license restrictions);
-- Reported EBITDA margins of 20%-24% in 2017 and 2018;
-- Working capital improvements of EUR5 million in 2017 and
    2018, respectively, due to the operational transformation of
    the business; and
-- Capital expenditure (capex) of EUR14 million-EUR18 million in
    2017 and 2018, respectively, due to the anticipated start of
    construction of the U.S. production and research and
    development plant.

Pending execution of the proposed refinancing of the EUR220
senior secured notes, we continue to assess Heckler & Koch's
liquidity as less than adequate. S&P said, "We believe that the
company lacks sound and well-established relationships with banks
and, in our view, is unlikely to be able to absorb high-impact,
low-probability events. We also consider the company's current
standing in credit markets to be relatively weak. At the same
time, the company has a track record of litigation and
significant operational setbacks (such as export license issues
and a complaint from Orbital ATK Inc.).

"However, we acknowledge the improved cash flow generation that
Heckler & Koch has demonstrated in 2016 and the first quarter of
2017. We also view the improvements in working capital stemming
from the newly introduced "made-when-ordered" manufacturing as
positive for Heckler & Koch's liquidity position. We note that
the company has allowed its EUR30 million RCF to expire, but we
do not believe that this is a concern as we project the company
to generate positive cash flow over the coming years.
Additionally, both proposed debt facilities have a clause that
allows Heckler & Koch to raise an additional EUR20 million from
each of the facilities when needed, subject to certain
conditions.

"We will review the CreditWatch placement within the next two
months. The CreditWatch placement reflects our expectation that
we will raise our rating on Heckler & Koch to 'B-' on successful
completion of the transaction, including the refinancing of the
existing senior secured notes.
The upgrade will be also conditional on the company's ability to
maintain stable performance, positive free operating cash flow
generation, and FFO cash interest coverage of above 2.0x, on an
adjusted basis, in 2017.

"Failure to implement the planned changes to the group's capital
structure or further significant delays in their implementation
would likely prompt us to affirm the 'CCC+' rating in the
immediate term. In the absence of a rapid alternative refinancing
plan, this would certainly reduce the company's financial
flexibility, leading potentially to rapidly rising rating
pressure, given mounting refinancing risk.

-- S&P affirmed its 'CCC+' issue rating on the company's senior
    notes. The recovery rating on the notes is unchanged at '4',
    indicating its expectation of average (30%-50%; rounded
    estimate: 30%) recovery in the event of a payment default.
-- S&P will withdraw the recovery and issue ratings on the
    existing EUR220 million senior secured notes upon completion
    of the refinancing.


K+S AG: Egan-Jones Cuts Senior Unsecured Ratings to BB+
-------------------------------------------------------
Egan-Jones Ratings Company, on June 13, 2017, downgraded the
senior unsecured ratings on debt issued by K+S AG to BB+ from
BBB.

K+S AG (formerly Kali und Salz GmbH) is a German chemical company
headquartered in Kassel. The company is Europe's largest supplier
of potash for use in fertilizer.


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


DECOBAKE: Provisional Liquidator Seeks Buyer for Business
---------------------------------------------------------
Gavin McLoughlin at the Sunday Independent reports that Declan de
Lacy -- D.deLacy@pkf.ie -- of PKF O'Connor Leddy & Holmes, the
liquidator of cake-decorating business Decobake, has appealed to
staff for their "help and co-operation" as the dispute over the
company's future developed further during the week.

Mr. de Lacy was appointed as official liquidator to the company
on July 24, having been appointed provisional liquidator last
month on foot of an unpaid rates bill, the Sunday Independent
relates.  The petition to have him appointed came from Dublin
City Council, the Sunday Independent discloses.

The liquidation has been contested vigorously by Decobake's
directors and a protest was held outside the liquidator's office
earlier last month, the Sunday Independent states.

"You may have been told that if I was appointed as full
liquidator then Decobake would close permanently and that all
staff would be made redundant.  This does not have to happen and
I am doing my utmost to prevent it from happening to Decobake,"
Mr. de Lacy, as cited by the Sunday Independent, said in a
message circulated to staff.

"My job is to ensure that the company and its business retain as
much value as possible, so that it can pay its employees and
creditors what they are due.  The best way for me to do this is
to keep the business trading and to sell it to new owners.

"I have tried to resume the company's trade since I was first
appointed and I believe that the Decobake business can be made to
survive.  To make this happen I need help and co-operation from
the staff."

Director Paul Coyle told the Sunday Independent that he had
repeatedly offered to pay Dublin City Council the sum of
EUR102,000 it said it was owed, with the latest offer coming on
July 21, but that the council had rejected this.

The company, which sells its goods on a wholesale basis to
Musgrave, also has retail outlets, the Sunday Independent notes.

In a statement to the Sunday Independent, Mr. de Lacy said that
he wants "to move on with maximizing the recovery for the
company's creditors".

The High Court heard on July 24 that there were other creditors
including the Revenue who would likely take the place of the
council if the council withdrew its petition for winding up the
company, the Sunday Independent relays.


GLG EURO CLO III: Moody's Assigns B2(sf) Rating to Class F Notes
----------------------------------------------------------------
Moody's Investors Service announced that it has assigned the
following definitive ratings to notes issued by GLG Euro CLO III
D.A.C.:

-- EUR212,000,000 Class A Senior Secured Floating Rate Notes due
    2030, Assigned Aaa (sf)

-- EUR23,300,000 Class B-1 Senior Secured Floating Rate Notes
    due 2030, Assigned Aa2 (sf)

-- EUR10,000,000 Class B-2 Senior Secured Fixed Rate Notes due
    2030, Assigned Aa2 (sf)

-- EUR32,000,000 Class C Deferrable Mezzanine Floating Rate
    Notes due 2030, Assigned A2 (sf)

-- EUR18,000,000 Class D Deferrable Mezzanine Floating Rate
    Notes due 2030, Assigned Baa2 (sf)

-- EUR19,800,000 Class E Deferrable Junior Floating Rate Notes
    due 2030, Assigned Ba2 (sf)

-- EUR10,400,000 Class F Deferrable Junior Floating Rate Notes
    due 2030, Assigned B2 (sf)

RATINGS RATIONALE

Moody's rating of the rated notes addresses the expected loss
posed to noteholders by the legal final maturity of the notes in
2030. The ratings reflect the risks due to defaults on the
underlying portfolio of loans given the characteristics and
eligibility criteria of the constituent assets, the relevant
portfolio tests and covenants as well as the transaction's
capital and legal structure. Furthermore, Moody's is of the
opinion that the collateral manager, GLG Partners LP ("GLG"), has
sufficient experience and operational capacity and is capable of
managing this CLO.

GLG Euro CLO III is a managed cash flow CLO. At least 90.0% of
the portfolio must consist of senior secured loans and senior
secured floating rate notes and up to 10% of the portfolio may
consist of unsecured loans, second-lien loans, mezzanine
obligations and high yield bonds. The portfolio is expected to be
approximately 60-65% ramped up as of the closing date and to be
comprised predominantly of corporate loans to obligors domiciled
in Western Europe.

GLG will manage the CLO. It will direct the selection,
acquisition and disposition of collateral on behalf of the Issuer
and may engage in trading activity, including discretionary
trading, during the transaction's four-year reinvestment period.
Thereafter, purchases are permitted using principal proceeds from
unscheduled principal payments and proceeds from sales of credit
risk and credit improved obligations, and are subject to certain
restrictions.

In addition to the seven classes of notes rated by Moody's, the
Issuer issued EUR38.2m of subordinated notes, which will not be
rated.

The transaction incorporates interest and par coverage tests
which, if triggered, divert interest and principal proceeds to
pay down the notes in order of seniority.

Factors that would lead to an upgrade or downgrade of the
ratings:

The rated notes' performance is subject to uncertainty. The
notes' performance is sensitive to the performance of the
underlying portfolio, which in turn depends on economic and
credit conditions that may change. GLG's investment decisions and
management of the transaction will also affect the notes'
performance.

Loss and Cash Flow Analysis:

Moody's modeled the transaction using CDOEdge, a cash flow model
based on the Binomial Expansion Technique, as described in
Section 2.3 of the "Moody's Global Approach to Rating
Collateralized Loan Obligations" rating methodology published in
October 2016. The cash flow model evaluates all default scenarios
that are then weighted considering the probabilities of the
binomial distribution assumed for the portfolio default rate. In
each default scenario, the corresponding loss for each class of
notes is calculated given the incoming cash flows from the assets
and the outgoing payments to third parties and noteholders.
Therefore, the expected loss or EL for each tranche is the sum
product of (i) the probability of occurrence of each default
scenario and (ii) the loss derived from the cash flow model in
each default scenario for each tranche. As such, Moody's
encompasses the assessment of stressed scenarios.

Moody's used the following base-case modeling assumptions:

Par amount: EUR350,000,000

Diversity Score: 40

Weighted Average Rating Factor (WARF): 2750

Weighted Average Spread (WAS): 3.70%

Weighted Average Recovery Rate (WARR): 43%

Weighted Average Life (WAL): 8 years.

Moody's has analysed the potential impact associated with
sovereign related risk of peripheral European countries. As part
of the base case, Moody's has addressed the potential exposure to
obligors domiciled in countries with local currency country risk
ceiling of A1 or below. Following the effective date, and given
the portfolio constraints and the current sovereign ratings in
Europe, such exposure may not exceed 10% of the total portfolio.
Also, the eligibility criteria do not currently allow for the
acquisition of assets where the obligor is domiciled in a country
with a local currency government bond rating below A3. Given this
portfolio composition, there were no adjustments to the target
par amount, as further described in the methodology.

Stress Scenarios:

Together with the set of modeling assumptions above, Moody's
conducted additional sensitivity analysis, which was an important
component in determining the rating assigned to the rated notes.
This sensitivity analysis includes increased default probability
relative to the base case. Below is a summary of the impact of an
increase in default probability (expressed in terms of WARF
level) on each of the rated notes (shown in terms of the number
of notch difference versus the current model output, whereby a
negative difference corresponds to higher expected losses),
holding all other factors equal:

Percentage Change in WARF: WARF + 15% (to 3163 from 2750)

Ratings Impact in Rating Notches:

Class A Senior Secured Floating Rate Notes: 0

Class B-1 Senior Secured Floating Rate Notes: -1

Class B-2 Senior Secured Fixed Rate Notes: -1

Class C Deferrable Mezzanine Floating Rate Notes: -2

Class D Deferrable Mezzanine Floating Rate Notes: -2

Class E Deferrable Junior Floating Rate Notes: -1

Class F Deferrable Junior Floating Rate Notes: 0

Percentage Change in WARF: WARF +30% (to 3575 from 2750)

Class A Senior Secured Floating Rate Notes: -1

Class B-1 Senior Secured Floating Rate Notes: -2

Class B-2 Senior Secured Fixed Rate Notes: -2

Class C Deferrable Mezzanine Floating Rate Notes: -3

Class D Deferrable Mezzanine Floating Rate Notes: -2

Class E Deferrable Junior Floating Rate Notes: -1

Class F Deferrable Junior Floating Rate Notes: -1

Methodology Underlying the Rating Action:

The principal methodology used in these ratings was "Moody's
Global Approach to Rating Collateralized Loan Obligations"
published in October 2016.


GLG EURO CLO III: S&P Assigns B- (sf) Rating to Class F Notes
-------------------------------------------------------------
S&P Global Ratings assigned its credit ratings to GLG Euro CLO
III DAC's class A, B-1, B-2, C, D, E, and F notes. At closing,
the issuer also issued unrated subordinated notes.

GLG Euro CLO III is a cash flow collateralized loan obligation
(CLO) transaction, securitizing a portfolio of primarily senior
secured loans granted to speculative-grade corporates. GLG
Partners LP manages the transaction.

Under the transaction documents, the rated notes pay quarterly
interest unless a frequency switch event occurs. Following such
an event, the notes will permanently switch to semiannual
interest payments.

The portfolio's reinvestment period will end approximatively four
years after closing, and the portfolio's maximum average maturity
date will be eight years after closing.

S&P said, "On the effective date, we understand that the
portfolio will represent a well-diversified pool of corporate
credits, with a fairly uniform exposure to all of the credits.
Therefore, we have conducted our credit and cash flow analysis by
applying our criteria for corporate cash flow collateralized debt
obligations (see "Global Methodologies And Assumptions For
Corporate Cash Flow And Synthetic CDOs," published on Aug. 8,
2016).

"In our cash flow analysis, we have used the portfolio target par
amount of EUR350 million, the covenanted weighted-average spread
of 3.80%, and the expected weighted-average recovery rates at
each rating level.

"The U.K. branch of Elavon Financial Services DAC (AA-/Stable/A-
1+) is the bank account provider and custodian. The participants'
downgrade remedies are line with our current counterparty
criteria (see "Counterparty Risk Framework Methodology And
Assumptions," published on June 25, 2013).

"The issuer is in line with our bankruptcy-remoteness criteria
(see "Structured Finance: Asset Isolation And Special-Purpose
Entity Methodology," published on March 29, 2017).

"Following our analysis of the credit, cash flow, counterparty,
operational, and legal risks, we believe our ratings are
commensurate with the available credit enhancement for each class
of notes."

RATINGS LIST

  GLG Euro CLO III DAC
  EUR363. 7 Million Secured Fixed-Rate And Floating-Rate Notes
  (Including EUR38. 2 Million Unrated Notes)

  Class             Rating          Amount
                                    (mil.)
  A                 AAA (sf)         212.0
  B-1               AA (sf)           23.3
  B-2               AA (sf)           10.0
  C                 A (sf)            32.0
  D                 BBB (sf)          18.0
  E                 BB (sf)           19.8
  F                 B- (sf)           10.4
  Sub               NR                38.2

  NR--Not rated.


M J WALLACE: October 9 Hearing Set for Case Against Directors
-------------------------------------------------------------
Aodhan O'Faolain at Independent.ie reports that a fund-appointed
liquidator's case for orders under the Companies Acts against
Independent TD Mick Wallace and his son, Sasha, has been fixed
for hearing next October.

Michael Leydon -- mleydon@outlookaccountants.ie -- liquidator of
the Independent TD's construction and property firm M J Wallace
Ltd, has brought proceedings against Mr. Wallace and his co-
director son over their stewardship of the company,
Independent.ie relates.

Mr. Leydon was appointed by Promontoria Aran, a subsidiary of US
fund Cerberus, arising out of a EUR2 million judgment obtained
against the company in relation to the Italian Quarter
development in Dublin, Independent.ie discloses.

The TD had previously raised questions over the Cerberus EUR1.6
billion purchase from NAMA of a group of Northern Ireland-linked
loans, called Project Eagle, Independent.ie recounts.

The liquidator is pursuing an application for orders under the
Companies Acts to have the respondents disqualified from acting
as company directors, or alternatively restricted in that role,
Independent.ie relays.

According to Independent.ie, the case has been fixed for hearing
on Oct. 23 but, before that, an application for discovery of
documents will be heard on Oct. 9.


=========
I T A L Y
=========


BANCA MONTE: Italy Sets Share Price for Capital Increase
--------------------------------------------------------
Sonia Sirletti at Bloomberg News reports that Italy took the
final steps to revive Banca Monte dei Paschi di Siena SpA,
setting the price for its portion of the aid package needed to
keep the world's oldest bank in business.

According to Bloomberg, a statement from the lender said the
government will pay EUR6.49 per share as part of the bank's
capital raising.

The statement said Italy recently published two decrees, setting
terms for a so-called precautionary recapitalization of the bank,
Bloomberg notes.

The Siena-based lender needs state support to survive, even
though regulators have declared it solvent, Bloomberg says.
Monte Paschi turned to Italy for help after it failed to raise
funding from investors in December, Bloomberg recounts.  The
package to recapitalize the bank is worth EUR8.3 billion (US$9.8
billion), Bloomberg discloses.

The European Commission on July 4 approved the recapitalization
after months of negotiations, Bloomberg relates.  The bank, as
cited by Bloomberg, said in its statement after the
recapitalization its capital will exceed EUR15.6 billion.  Shares
resulting from burden sharing and the stock subscribed by the
state will be admitted to trading on the Italian Stock Exchange
following the publication of the Listing Prospectus, Bloomberg
states.

Banca Monte dei Paschi di Siena SpA -- http://www.mps.it/-- is
an Italy-based company engaged in the banking sector.  It
provides traditional banking services, asset management and
private banking, including life insurance, pension funds and
investment trusts.  In addition, it offers investment banking,
including project finance, merchant banking and financial
advisory services.  The Company comprises more than 3,000
branches, and a structure of channels of distribution.  Banca
Monte dei Paschi di Siena Group has subsidiaries located
throughout Italy, Europe, America, Asia and North Africa.  It has
numerous subsidiaries, including Mps Sim SpA, MPS Capital
Services Banca per le Imprese SpA, MPS Banca Personale SpA, Banca
Toscana SpA, Monte Paschi Ireland Ltd. and Banca MP Belgio SpA.



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


KRATON POLYMERS: Moody's Rates New Euro 1st Lien Term Loan Ba3
--------------------------------------------------------------
Moody's Investors Service has assigned Ba3 rating to the proposed
Euro first lien term loan and Ba3 rating to the re-priced USD
first lien term loan issued by Kraton Polymers LLC and Kraton
Polymers Holding B.V. At the same time, Moody's has affirmed
Kraton Corporation's B1 Corporate Family Rating (CFR), and B3 for
its $440 million Sr. unsecured notes due in 2023 and $400 million
Sr. unsecured notes due in 2025, respectively. Proceeds from the
new EUR term loan will be used to refinance its existing USD term
loan, and for fees and expenses. The outlook is stable.

Ratings assigned:

Kraton Polymers LLC (Co-Issued by Kraton Polymers Holdings B.V.)

EUR Gtd Sr. Sec. 1st Lien Term Loan due 2022 -- Ba3 (LGD3)

USD Gtd Sr. Sec. 1st Lien Term Loan due 2022 -- Ba3 (LGD3)

Ratings affirmed:

Kraton Corporation

  Corporate Family Rating -- B1

  Probability of Default Rating -- B1-PD

  Speculative Grade Liquidity Rating - SGL-2

  Outlook -- Stable

Kraton Polymers LLC

  $440mm Gtd Sr. Unsecured Notes due 2023 -- B3 (LGD5)

  $400mm Gtd Sr. Unsecured Notes due 2025 -- B3 (LGD5)

Outlook -- Stable

RATINGS RATIONALE

The B1 Corporate Family Rating reflects Kraton's elevated
leverage of 5.3x for the LTM March 2017, its performance
volatility due to large movements in raw material prices, small
risk of product substitution, as well as challenges in improving
earnings after the acquisition of Arizona Chemical Holdings
Corporation in 2016 and ramping up its production at its joint
venture with Formosa. The price increase in raw materials
(affecting polymer segment) and low-cost C5 hydrocarbon
alternatives (affecting chemical segment) resulted in earnings
pressure and weaker than expected operating cash flow in the
first half of 2017. Although free cash flow is expected to be
positive in 2017, meaningful debt reduction will likely be
delayed to 2018.

Kraton's ratings are supported by the fundamentally larger and
more diversified company and roughly twice the operating
footprint globally following the Arizona acquisition in 2016.
Kraton's earnings and free cash flows benefit from combining its
leading market positions in higher margin HSBC and Cariflex
products with Arizona's CTO/CST based products with advantaged
feedstock position and strong profitability. Other factors
supporting the rating are the company's raw material
diversification (hydrocarbons and CTO/CST based products), long-
lived customer and supplier relationships, diverse end-markets
and customers, and "green" product offerings. Management's plans
for debt reduction support anticipated credit metric improvements
in 2017 and 2018. Moody's expects Kraton to improve its cash flow
generation and lower its adjusted debt/EBITDA to 5.0x or lower in
2018, as it digests the impact of increased raw material costs,
realizes further synergies and reduces its capex.

Kraton's proposed EUR term loan and re-pricing of its remaining
USD term loan will be net debt neutral and potentially reduce
interest expense. Financing in Euro will also bring its
liabilities more in line with its material business operations in
Europe. Despite additional guarantees and security, the EUR term
loan is rated the same as the USD term loan, given the
intercreditor agreement with a collateral allocation mechanism
that proportionally allocates collateral between EUR and USD term
loans and equalizes the recovery for both creditors.

Kraton's liquidity is supported by its large cash balance, cash
flow from operations, a $250 million five year revolving credit
facility. Kraton's $97 million cash on hand, excluding its joint
venture, as of March 30, 2017 was more than sufficient for its
daily business operation and provided additional liquidity for
debt redemption. Cash Flow from Operations will exceed $100
million and sufficiently cover its capital expenditure in the
coming 12 months, providing further liquidity for debt
redemption. The increased raw material costs during the first
half of 2017 are likely to increase working capital needs and
reduce its operating cash flow from $138 million in 2016.
However, Moody's expects capex to decrease to a more normalized
level from the elevated level of $125 million in 2016 as the
company has completed the construction at its JV HSBC plant in
Taiwan. The revolver has not been drawn and is expected to be
utilized only in periods of volatile raw material prices. The
revolver has a springing fixed charge covenant of 1x, which
Moody's does not expects to be tested over the next 12-18 months.
The new term loan and unsecured notes are covenant-lite.
Historically, there is no regular dividend at Kraton, but the
company has used excess cash to fund share repurchases. However,
Moody's does not anticipates this to be the case, while
management focuses on deleveraging.

The stable outlook reflects Moody's expectations that Kraton will
generate adequate amounts of free cash flow over the next 12-18
months to reduce leverage to 5.0x or lower. Additionally, Moody's
expects the company will maintain conservative financial policies
and hold off on dividends, share repurchases, and large debt
funded acquisitions until a meaningful amount of debt repayment
has occurred.

The rating has limited upside due to the debt funded acquisition
resulting in increased leverage. The rating could be upgraded
once leverage is sustainably below 4.5x.

The rating could be downgraded if EBITDA margins deteriorate,
leverage exceeds 6.0x or there is a lack of free cash flow
generation.

The principal methodology used in these ratings was Global
Chemical Industry Rating Methodology published in December 2013.

Kraton Corporation, headquartered in Houston, Texas, is a major
global producer of styrenic block copolymers (SBCs), which are
synthetic elastomers used in industrial and consumer
applications. In early 2016, through its acquisition of Arizona
Chemical Holdings Corporation, Kraton added capabilities in the
production and sales of pine based specialty chemicals. The
company generated revenues of about $983 million in the first six
months of 2017.


===========
R U S S I A
===========


BRUNSWICK RAIL: S&P Affirms Then Withdraws 'CC' Long-Term CCR
-------------------------------------------------------------
S&P Global Ratings said it has affirmed its 'CC' long-term
corporate credit rating on Russia-based freight car lessor
Brunswick Rail Ltd. S&P said, "At the same time, we affirmed our
'CC' issue rating on the existing senior unsecured notes due in
2017.

"We subsequently withdrew the ratings at the issuer's request. At
the time of the withdrawal, the outlook was negative."

At the time of the affirmation and withdrawal, Brunswick was
continuing to pursue the restructuring of its senior unsecured
US$600 million notes, due in November 2017, in light of its
currently vulnerable liquidity position and mounting refinancing
needs.


METALLOINVEST JSC: S&P Affirms 'BB' CCR, Outlook Stable
-------------------------------------------------------
S&P Global Ratings affirmed its 'BB' long-term corporate credit
rating on Russia-based iron ore producer JSC Holding Company
Metalloinvest. The outlook is stable.

S&P said, "We also affirmed our 'BB' issue ratings on the
company's bonds issued through Metalloinvest Finance D.A.C.

"The affirmation reflects our view that Metalloinvest will
maintain adequate ratios for the rating, including funds from
operations (FFO) to debt consistently above 30% and debt to
EBITDA well below 3x, assuming normal market conditions, in the
next two-to-three years. It also reflects our expectation that
the company will continue to demonstrate flexibility in
shareholder distributions and capital expenditure (capex) to
address the potential deterioration in the iron ore and steel
markets.

"We note that the company has fully disposed of the remaining
1.79% stake in MMC Norilsk Nickel PJSC (Nornickel) and received a
cash consideration of $400 million. The company initially
acquired 5% in Nornickel in 2011 for $2 billion; in our analysis
we recognized this as a liquid investment but we also expressed
concerns about the company's financial policies given that it was
a non-core and non-strategic investment. Our concerns were
heightened by the unclear and unpredictable approach to
shareholder distributions and uncertainties around the Udokan
copper greenfield development, which could have materially
weighed on Metalloinvest's financial profile and leverage."

S&P now notes certain improvements in Metalloinvest's financial
policies:

-- The Udokan greenfield was spun-off from Metalloinvest to the
    shareholder level;
-- The Nornickel stake was disposed of and the proceeds were
    used mostly to pay down debt;
-- Distributions to shareholders were moderated during the
    pressured pricing environment in 2015 and 2016; and
-- The governance structure has been simplified following the
    transfer of Metalloinvest's shares to a Russia-based entity.

S&P said, "Because of this recent track record, we now see a
reduced risk that unfavorable shareholder and management actions
will result in Metalloinvest becoming materially more leveraged
(compared to our base case).

"We continue to take a positive view of Metalloinvest's large
iron ore reserves; vertically integrated business model with a
product mix diversification (allowing work with both blast
furnace and electric arc furnace steel producers); and favorable
position on the production cost curve. These strengths are
challenged by the company's exposure to the inherent cyclicality
of commodities and to high country risk in Russia."

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

-- Average benchmark iron ore prices of $60 per metric ton (/MT)
    for the rest of 2017 and $50/MT in 2018-2019.
-- Consumer price index in Russia of 4.5% this year and 4.0% in
    2018-2019.
-- Increase of hot briquetted iron (HBI) production starting
    from July 2017 on the back of the launch of the HBI-3
    facility at Lebedinsky GOK.
-- Some reduction in iron ore concentrate and pellets volumes
    sold in line with the company's strategy to increase its
    share of higher-value-added products, notably HBI, steel
    billets for railway wheels and rails, special bar quality
   (SBQs), and bridge steel.
-- Annual capex of about $400 million-$550 million.
-- Yearly distributions to shareholder of $600 million-$900
    million.
-- Relatively stable EBITDA margins of approximately 30%-35%.

Based on these assumptions, S&P arrives at the following credit
measures in 2017-2019:

-- EBITDA of about $1.9 billion in 2017 and $1.6 billion in 2018
    and 2019.
-- FFO-to-debt of 35%-40% in those years.
-- S&P Global Ratings-adjusted debt to EBITDA of about 2x.

S&P said, "The stable outlook reflects our expectations that for
the next two years Metalloinvest's FFO to debt will remain above
30% and debt to EBITDA will not exceed 3x under normal market
conditions, which is commensurate with the 'BB' rating. It also
reflects our view that the company's strong positions in iron ore
product markets are underpinned by very low production costs,
access to vast iron ore reserves, a diverse customer base,
premiums of higher-value-added products (such as pellets, HBI,
and direct reduced iron) and the benefits of vertical integration
into steel.

"We could consider an upgrade if Metalloinvest reported much
better operating and financial performances than we currently
assume on the back of supportive market developments and a
stronger pricing environment. This would hinge on sustainably
stronger credit metrics, with FFO to debt comfortably above 45%
and debt to EBITDA below 2x.

"Negative rating pressure could stem from increasing leverage or
weaker liquidity, for example owing to lower margins, a drop in
volumes, or higher shareholder distributions. We could consider
lowering the rating if FFO to debt falls below 30% or debt to
EBITDA exceeds 3.0x without short-term recovery prospects in the
current market environment."


SERGEY POYMANOV: PPF's Request to Admit Gureev Evidence Denied
--------------------------------------------------------------
Aleksey Vladimirovich Bazarnov, the financial administrator
appointed by the Commercial (Arbitrazh) Court of the Moscow
Region in the insolvency proceeding of Sergey Petrovich Poymanov
pending in Russia pursuant to Russian Federal Law No. 127-FZ, has
moved for recognition of the Russian Insolvency Proceeding as a
"foreign main proceeding" under Chapter 15 of the Bankruptcy Code
and a finding, pursuant to section 1520 of the Bankruptcy Code,
that an action commenced by PPF Management LLC against the
Petitioner and various other defendants in the U.S. District
Court for the Southern District of New York is subject to the
automatic stay. PPF opposes both recognition of the Russian
Insolvency Proceeding and the Petitioner's request for a
finding that the SDNY Action is subject to the automatic stay.

PPF filed the motion now before the Court, seeking to reopen the
evidentiary record to introduce additional evidence it contends
the Court should consider in connection with its ruling on the
Verified Petition and PPF's objections thereto. The Petitioner
opposes the Motion.

PPF moves to reopen the evidentiary record to introduce three
categories of additional evidence: (1) the Nogotkov Letter; (2)
the Gureev Evidence and (3) the Assignment Related Evidence.

Judge Mary Kay Vyskocil of the U.S. Bankruptcy Court for the
Southern District of New York denied PPF's request to reopen the
Record to admit the Nogotkov Letter and the Gureev Evidence but
granted PPF's request to reopen the Record to introduce the
developments concerning the Assignment Motion.

PPF argues that the Court should reopen the Record to permit PPF
to introduce the Nogotkov Letter as relevant to PPF's argument
that recognition of the Russian Insolvency Proceeding should be
denied on public policy grounds.  Section 1506 of the Bankruptcy
Code authorizes a court to refuse to take an action under Chapter
15 if such action would be "manifestly contrary to the public
policy of the United States." Specifically, PPF contends that the
Nogotkov Letter, and its timing, constitute evidence that the
Petitioner commenced this Chapter 15 case in bad faith, in order
to thwart the SDNY Action, to further the conspiracy to deprive
Poymanov of his ownership interests in P-Granit and to retaliate
against Poymanov by generating criminal charges.

The request to reopen the Record to allow the Nogotkov Letter to
be introduced into evidence is denied.  The letter is not
relevant to the issues before the Court in connection with the
Verified Petition.  There is no allegation that Petitioner
participated in drafting the Nogotkov Letter, the Petitioner is
not copied on the letter, and he is not mentioned in the letter .
There is no evidence in the Record that the Petitioner is
conspiring, or has conspired, with Nogotkov, and even if the
Petitioner were aware of the letter at the time it was sent, the
letter does not prove that the Petitioner commenced this Chapter
15 case to facilitate a conspiracy against Poymanov.

PPF also seeks to introduce information concerning the finances
and employment of Petr Gureev in support of its argument that the
Verified Petition should be denied. Specifically, PPF contends
that the foreign debtor -- Poymanov -- has failed to satisfy the
eligibility requirements of section 109(a), which provides, in
relevant part, that only a person that resides or has a domicile,
a place of business, or property in the U.S. may be a debtor
under the Bankruptcy Code.

PPF's request to reopen the Record to admit the Gureev Evidence
is denied because the Gureev Evidence is not probative of whether
the funds held in the retainer account constitute Poymanov's
property and thereby satisfy the eligibility requirements of
section 109(a).

The final new evidence that PPF seeks to introduce relates to the
Petitioner's motion in the Russian Insolvency Proceeding for a
determination that the PPF Assignment is invalid as a matter of
Russian Bankruptcy Law.  PPF seeks to update the Court as to
actions taken by the Russian Court with respect to the Assignment
Motion.

The Court finds that the Assignment Motion is relevant to the
Petitioner's request for an order determining that the SDNY
Action is subject to the automatic stay because, if the PPF
Assignment is valid, then the claims asserted in the SDNY Action
would belong to PPF, not Poymanov, and therefore the SDNY Action
would not be subject to the automatic stay.  If, on the other
hand, the Russian Court were to determine that the PPF Assignment
is not valid as a matter of Russian Bankruptcy Law and
accordingly the PPF Assignment is void, then at least the portion
of the claims asserted in the SDNY Action that belong to
Poymanov, or otherwise should be administered as part of the
Russian Insolvency Proceeding, would be subject to the automatic
stay.

The Assignment Related Evidence is therefore highly relevant to
the issues before the Court.

A full-text copy of Judge Vyskocil's Decision dated July 27,
2017, is available at:

     http://bankrupt.com/misc/nysb17-10516-68.pdf

Counsel for Aleksey Vladimirovich Bazarnov, as Petitioner:

     Owen C. Pell, Esq.
     Laura J. Garr, Esq.
     Alice Tsier Esq.
     WHITE & CASE LLP
     1221 Avenue of the Americas
     New York, New York 10020
     opell@whitecase.com
     lgarr@whitecase.com
     atsier@whitecase.com

            -and-

     Richard S. Kebrdle, Esq.
     Jason Zakia, Esq.
     Matthew A. Goldberger, Esq.
     Southeast Financial Center, Suite 4900
     200 South Biscayne Blvd.
     Miami, Florida 33131
     rkebrdle@whitecase.com
     jzakia@whitecase.com
     mgoldberger@whitecase.com

Counsel for PPF Management LLC:

     Alan J. Brody, Esq.
     Caroline J. Heller, Esq.
     GREENBERG TRAURIG, LLP
     Met Life Building
     200 Park Avenue
     New York, New York 10166
     brodya@gtlaw.com
     hellerc@gtlaw.com

            -and-

     Sanford M. Saunders Jr., Esq.
     Nicoleta Timofti, Esq.
     2101 L. Street, N.W., Suite 1000
     Washington, D.C. 20037
     saunderss@gtlaw.com
     timoftin@gtlaw.com

Headquartered in Moscow, Russia, Sergey Petrovich Poymanov and
Aleksey Vladimirovich Bazarnov filed a petition for recognition
of a foreign proceeding (Bankr S.D.N.Y. Case No. 17-10516) on
March 3, 2017.  Owen C. Pell, Esq., at White & Case LLP serves as
the Debtors' counsel.


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


BANCO POPULAR ESPANOL: Egan-Jones Withdraws C Sr. Unsec. Ratings
----------------------------------------------------------------
Egan-Jones Ratings Company, on June 7, 2017, withdrew the C
senior unsecured ratings on debt issued by Banco Popular Espanol
SA.  EJR also withdrew the D ratings on the Company's commercial
paper.

Previously, on June 3, 2017, EJR lowered the Company's senior
unsecured ratings to C from B and the Company's commercial paper
rating to C from B.

Banco Popular Espanol, S.A. is the fourth largest banking group
in Spain.


BANKIA SA: Moody's Rates EUR750MM Tier 1 Preferred Sec. B2(hyb)
---------------------------------------------------------------
Moody's Investors Service has assigned a B2(hyb) rating to the
EUR750 million perpetual non-cumulative contingent convertible
additional Tier 1 preferred securities issued by Bankia, S.A.
(Bankia) (Baa3/Ba1 developing, ba2).

The B2(hyb) rating assigned to the notes is based on Bankia's
standalone creditworthiness and is positioned three notches below
the bank's ba2 adjusted baseline credit assessment (BCA): one
notch below to reflect high loss severity under Moody's Advanced
Loss Given Failure (LGF) analysis; and a further two notches
below to reflect the higher payment risk associated with the non-
cumulative coupon skip mechanism, as well as the probability of
the bank-wide failure. The LGF analysis also takes into
consideration the conversion feature, in combination with the
Tier 1 notes' deeply subordinated claim in liquidation.

RATINGS RATIONALE

According to Moody's framework for rating non-viability
securities under its bank rating methodology, the agency
typically positions the rating of Additional Tier 1 securities
three notches below the bank's adjusted BCA. One notch reflects
the high loss-given-failure that these securities are likely to
face in a resolution scenario, due to their deep subordination,
small volume and limited protection from residual equity. Moody's
also incorporates two additional notches to reflect the higher
risk associated with the non-cumulative coupon skip mechanism,
which could precede the bank reaching the point of non-viability.

The notes are unsecured and perpetual, subordinated to
unsubordinated and subordinated instruments that do not
constitute AT1 capital, and senior to ordinary shares. They have
a non-cumulative optional and a mandatory coupon-suspension
mechanism. A conversion into common shares is triggered if the
group's or the bank's transitional Common Equity Tier 1 (CET1)
capital ratio falls below 5.125%, which Moody's views as close to
the point of non-viability. At March 31, 2017, Bankia's
consolidated CET1 ratio stood at 15.1% (including unrealised
gains on the available for sale sovereign portfolio), while its
standalone CET1 ratio stood at 14.6%.

WHAT COULD CHANGE THE RATING UP/DOWN

Any changes in the ba2 adjusted BCA of the bank would likely
result in changes to the B2(hyb) rating assigned to these
securities. In addition, any increase in the probability of a
coupon suspension would also lead us to reconsider the rating
level.

Upward pressure on Bankia's BCA could be driven by a further
sustained improvement on its key financial metrics. Conversely,
downward pressure on the bank's standalone BCA could arise if
Bankia's credit profile weakens as a consequence of its merger
with Banco Mare Nostrum.

LIST OF AFFECTED RATINGS

Issuer: Bankia, S.A.

Assignment:

-- Preferred Stock Non-cumulative, assigned B2(hyb)

PRINCIPAL METHODOLOGY

The principal methodology used in this rating was Banks published
in January 2016.


BANKIA SA: Moody's Assigns (P)Ba3 Rating to Medium Term Note
------------------------------------------------------------
Moody's Investors Service assigned a (P)Ba3 rating to the long-
term senior non-preferred medium term note programme of Bankia,
S.A. (Bankia).

The senior non-preferred notes, referred to as "junior senior"
unsecured notes by Moody's, could be issued under Bankia's EUR10
billion Euro Medium Term Note Programme. The notes will be
explicitly designated as senior non-preferred in the
documentation. As such, in resolution and insolvency, they would
rank junior to other senior obligations, including senior
unsecured debt, and senior to subordinated debt. They will have a
minimum maturity at issuance of one year.

RATINGS RATIONALE

The (P)Ba3 rating assigned to the junior senior unsecured debt
programme reflects (1) Bankia's adjusted baseline credit
assessment (BCA) of ba2; (2) Moody's Advanced Loss Given Failure
(LGF) analysis, which indicates likely high loss severity for
these instruments in the event of the bank's failure, leading to
a position one notch below the bank's adjusted BCA; and (3)
Moody's assumption of a low probability of government support for
this new instrument, resulting in no uplift.

Bankia is subject to the EU's Bank Recovery and Resolution
Directive (BRRD), which Moody's considers to be an Operational
Resolution Regime. Therefore, Moody's applies its Advanced LGF
analysis to determine the loss-given-failure of the junior senior
notes. For Bankia, Moody's assumes residual tangible common
equity of 3% and losses post-failure of 8% of tangible banking
assets, in keeping with Moody's standard assumptions. Given the
relatively small amount of junior senior debt to be issued, at
least at first, and the current subordination in the form of Tier
2, preference shares and residual equity, the LGF analysis
indicates likely high loss-given-failure. As a result, the
securities will be positioned one notch below the adjusted BCA.

The issuance of junior senior securities by Bankia follows the
publication of Spanish Royal Decree-Law 11/2017 on June 23, 2017,
which modifies the hierarchy of claims in an insolvency by
introducing a new type of debt within the senior debt class that
ranks junior to other senior debt instruments. To fall into the
category of the non-preferred, or "junior senior," debt class,
the securities must have an original maturity of one year or
more, cannot have derivative features, and the related issuance
documents must incorporate a contractual subordination clause.
This law facilitate banks' compliance with the European Union's
(EU) Minimum Requirement for own funds and Eligible Liabilities
(MREL).

The issuer can redeem or make changes to the terms of the
securities in case the notes cease to be MREL-eligible
instruments in light of possible changes to Spanish law or other
applicable banking regulations. Changes to the terms and
conditions, however, should not be materially less favourable to
holders of this instrument.

Given that the very purpose of the junior senior notes is to
provide additional loss absorption and improve the ability of
authorities to conduct a smooth resolution of troubled banks,
government support for these instruments is unlikely in Moody's
view and the agency therefore attributes only a low probability
to a scenario where the government would support this debt class.
As a result there is no further uplift from government support.

WHAT COULD CHANGE THE RATING UP/DOWN

Moody's advanced LGF analysis indicates that there is currently
little sensitivity of these notes' rating to further issuance of
junior senior debt or more subordinated instruments such as Tier
2 and / or Additional Tier 1.

Bankia's junior senior debt programme rating could be also
upgraded or downgraded together with any upgrade or downgrade of
Bankia's Adjusted BCA. Upward pressure on Bankia's BCA and
Adjusted BCA could be driven by a further sustained improvement
on its key financial metrics. Conversely, downward pressure on
the bank's standalone BCA could arise if Bankia's credit profile
weakens as a consequence of its merger with Banco Mare Nostrum .

LIST OF AFFECTED RATINGS

Issuer: Bankia, S.A.

Assignment:

-- Junior Senior Unsecured Medium-Term Note Program, assigned
    (P)Ba3

PRINCIPAL METHODOLOGY

The principal methodology used in this rating was Banks published
in January 2016.


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


ALBA 2007-1: Fitch Corrects June 15 Rating Release
--------------------------------------------------
This announcement corrects the version published on June 15,
2017, amending the rating of the Alba 2007-1 Class B note to
'AA+sf' RWE from 'AAAsf' RWN.

Fitch Ratings has placed Alba 2006-1 plc, Alba 2006-2 plc and
Alba 2007-1 plc's 'AAAsf' tranches on Rating Watch Negative (RWN)
and all other tranches on Rating Watch Evolving (RWE). A full
list of rating actions is at the end of this rating action
commentary.

The transactions are securitisations of non-conforming UK
residential mortgages originated pre-crisis by Paratus (GMAC),
Kensington Mortgage Company and Finsbury Park.

KEY RATING DRIVERS

Insufficient Collateral Information
Information on borrower and loan characteristics was not
available on a loan-by-loan basis for this review, so Fitch was
unable to conduct a full rating assessment that would properly
reflect the credit risk associated with these transactions. Fitch
has therefore placed the entire capital structures on RWN and
RWE.

Error Resolved
Fitch identified in its June 16, 2016 rating action erroneous
data entries in its models regarding prior arrears which affected
Alba 2006-1 plc's class C, D and E notes, Alba 2006-2 plc's class
F notes and Alba 2007-1 plc's class D notes. The rating action
corrects these data entry inconsistencies.

RATING SENSITIVITIES

Adverse macroeconomic conditions could result in high
unemployment or a decline in property values. This in turn may
compress excess spread and reduce the credit enhancement
available, leading to negative rating action.

The rating actions are:

Alba 2006-1 plc
Class A3a XS0254830499: 'AAAsf' placed on RWN
Class A3b XS0254831893: 'AAAsf' placed on RWN
Class B XS0254833089: 'AAsf' placed on RWE
Class C XS0254833758: 'Asf' placed on RWE
Class D XS0254834053: 'BBBsf' placed on RWE
Class E XS0254834301: 'Bsf' placed on RWE

ALBA 2006-2 plc
Class A3a XS0271529967: 'AAAsf' placed on RWN
Class A3b XS0272876623: 'AAAsf' placed on RWN
Class B XS0271530114: 'AAAsf' placed on RWN
Class C XS0271530544: 'Asf' placed on RWE
Class D XS0271530973: 'BBB+sf' placed on RWE
Class E XS0271531435: 'BBsf' placed on RWE
Class F XS0272877514: 'CCCsf'; placed on RWE

ALBA 2007-1 plc
Class A3 XS0301721832: 'AAAsf' placed on RWN
Class B XS0301706288: 'AA+sf' placed on RWE
Class C XS0301707096: 'Asf' placed on RWE
Class D XS0301708060: 'BBBsf' placed on RWE
Class E XS0301708573: 'Bsf' placed on RWE
Class F XS0301708813: 'CCCsf' placed on RWE


MARKS & SPENCER: Egan-Jones Lowers Sr. Unsecured Ratings to BB+
---------------------------------------------------------------
Egan-Jones Ratings Company, on June 7, 2017, downgraded the
senior unsecured ratings on debt issued by Marks & Spencer Group
PLC to BB+ from BB.

Marks and Spencer plc (also known as M&S) is a major British
multinational retailer headquartered in the City of Westminster,
London.  It specialises in the selling of clothing, home products
and luxury food products.


NOBLE CORP: Egan-Jones Lowers LC Sr. Unsecured Rating to BB-
------------------------------------------------------------
Egan-Jones Ratings Company, on June 12, 2017, lowered the local
currency senior unsecured rating on debt issued by Noble Corp plc
to BB- from BB.

Noble Corporation plc is an offshore drilling contractor based in
London, United Kingdom. It is the corporate successor of Noble
Drilling Corporation.


PAYSAFE GROUP: S&P Places 'BB' CCR on CreditWatch Negative
-----------------------------------------------------------
S&P Global Ratings placed its 'BB' long-term corporate credit
rating on Paysafe Group PLC, a U.K.-headquartered provider of
payment solutions, on CreditWatch with negative implications.

S&P said, "At the same time, we affirmed our 'BB+' issue ratings
on Paysafe's EUR220 million senior secured term loan B and $85
million revolving credit facility. The recovery rating on this
debt is '2', indicating our expectation of approximately 80%
recovery for creditors in the event of a payment default. We are
not placing the issue ratings on CreditWatch because the debt
documentation includes a change-of-control clause and we
therefore expect the loans will be repaid if the LBO is
successful.

"The CreditWatch follows the preliminary and conditional offer by
private equity investors Blackstone and CVC Capital Partners to
acquire Paysafe's entire issued and to be issued share capital
for 590 pence per share, which we estimate values the equity at
about GBP3 billion. We consider Paysafe's possible new owners as
financial sponsors, and we expect they will pursue aggressive
financial policies for the company that would result in much
higher leverage than we currently forecast for Paysafe." In
addition, weaker credit metrics would outweigh the positive
implications of the disposal of Paysafe's Asia Gateway business,
which the acquirers have made a pre-condition, for our assessment
of its customer concentration and exposure to the online gambling
sector. This business generated about 10% of revenues in 2016,
pro forma the acquisition of Merchants Choice Payment Solutions
(MCPS), according to Paysafe.

Paysafe is planning to fund the acquisition of MCPS with $380
million of new debt and cash. In the event that the LBO is not
completed and Paysafe continues to operate in its current form,
we expect the acquisition of MCPS would increase leverage
initially, but that Paysafe's credit metrics would remain
compatible with the current rating level, and strengthen once
again over the next 12 to 18 months. Thanks to its robust
operating performance, Paysafe had reduced S&P Global Ratings-
adjusted debt to EBITDA to 2.1x by the end of 2016, creating some
headroom for acquisitions. S&P said, "As a result, we project
that the MCPS purchase would lead only to temporarily higher debt
to EBITDA of 2.5x-2.7x in 2017, on a pro forma basis, before
improving to 2.2x-2.3x in 2018, based on our forecast of low
double-digit growth in our adjusted EBITDA. We also think that
the transaction is incrementally positive for Paysafe's business,
as it provides additional scale and further diversifies the
company's revenue streams, for example by expanding its customer
base to point-of-sale merchants. We expect the dilution from the
combination with MCPS, whose EBITDA margins are significantly
lower than in Paysafe's existing business, will be partly offset
by acquisition synergies and operating leverage.

"Our current assessment of Paysafe's business risk does not take
into account any potential divestments or strategic changes that
may occur upon completion of the LBO. In our view, the company's
business risk remains constrained by the relative niche focus of
its product portfolio, compared with the overall payment services
market, as well as the wider software and services industry. With
about $850 million of pro forma 2017 external revenues from
payment processing in our forecast, Paysafe remains a fairly
small player in the still-fragmented and competitive payment
services market, and within this segment the company targets
merchants in segments with a higher-risk profile. Moreover,
alternative payment methods of digital wallets and online prepaid
vouchers remain a key element in Paysafe's value proposition,
accounting for about 40% of revenues in our pro forma forecast
for 2017. Although these services experience good take-up in
certain subsectors, they remain niche products within the wider
digital payments market, in our view, and bear some uncertainty
as to their long-term prospects in the steadily evolving payments
ecosystem. Also, Paysafe's reliance on the online gambling
sector, which contributed about 35% of 2016 revenues -- pro forma
MCPS -- and which we consider prone to unexpected adverse
legislative changes, is still substantial. Furthermore, Paysafe
is subject to financial services regulation for certain aspects
of its business. These risk factors are partly mitigated by
Paysafe's good track record of double-digit organic growth, and
its well-established position in digital wallets and prepaid
vouchers, which has allowed the company to become the leading
payment provider for the online gambling and gaming niche
markets.

"In its current form and excluding the implications of the
possible LBO, our view of Paysafe's financial risk profile is
primarily based on our expectation that robust EBITDA growth will
enable the company to maintain our adjusted leverage comfortably
between 2x and 3x despite its intention to pursue further
acquisitions. Given our view of Paysafe's business risk and
appetite for inorganic growth, we calculate its credit metrics on
a gross debt basis. Although Paysafe's current commitment to
maintaining net debt to EBITDA (as per the company's definition)
of between 2.0x and 3.0x leaves room for our adjusted debt to
EBITDA to exceed 3.0x in the event of large transactions, the
company's track record and perceived preference for conservative
use of debt limit the risk that adjusted leverage would stay
above 3x for a prolonged period, in our view. We regard Paysafe's
free cash flow generation, which benefits from limited working
capital needs and capital expenditure (capex) requirements, as
very solid, with forecast reported EBITDA-to-free cash flow
conversion of more than 50% in 2017-2019.

"We aim to resolve the CreditWatch after the outcome of the LBO
offer is known, which we expect to occur within the next three
months.

"We could lower our rating on Paysafe to the 'B' category if the
LBO is successfully completed. The number of notches of the
possible downgrade would depend on our assessment of the
financial policy the new financial sponsor owners would pursue
for Paysafe, as well as our expectations for the company's credit
metrics, liquidity, and cash flow generation post-closing.

"We could affirm the rating if the LBO is abandoned and Paysafe
continues to operate with its current shareholder structure,
financial policy, and scope of business."


RED PHARMA: Expects to Exit Administration After BTK Program Sale
-----------------------------------------------------------------
Proactive Investor reports that Redx Pharma Plc is expected to
exit administration after selling its Bruton's tyrosine kinase
(BTK) inhibitor technology and drug development programme for
US$40 million.

The deal was struck on July 28 with NASDAQ-listed Loxo Oncology
Inc., Proactive Investor discloses.

The transaction, which could also see Redx relisted on AIM,
follows a rocky period for the life sciences group, Proactive
Investor notes.

Its shares were suspended in May after it entered administration
when Liverpool Council called in a GBP2 million loan, Proactive
Investor recounts.

According to Proactive Investor, Jason Baker, joint administrator
of the company, said the sale of part of Redx portfolio was
represented a "significant step forward" for business and its
rescue as a going concern.

"[Mon]day's unconditional agreement is for the realisation of
certain of the group's intellectual property assets, the proceeds
from which will allow for the creditors of the companies to be
paid in full and provide working capital for the group's
continuing business, thus restoring the companies to solvency.

"The administrators anticipate that, upon their review and
approval of the management's final business plan, the company
will be set to exit administration.

"Upon exit from administration the directors of the company will
be in a position to request the lifting of the suspension of the
company's shares from trading on AIM.

"Until the exit from administration we shall continue with the
discharge of our statutory duties as administrators in the
interests of all creditors."

Redx Pharma is focused on the discovery and development of
proprietary, small molecule therapeutics to address areas of high
unmet medical need, in cancer, immunology and infection.


* UK: Firms in Significant Financial Distress Up 25% in 2Q 2017
--------------------------------------------------------------
Will Martin at Business Insider reports that huge numbers of
British businesses are experiencing "significant" levels of
financial distress and could be at risk of going bust.

According to Business Insider, Begbies Traynor's "Red Flag Alert"
report for the second quarter of 2017 shows that 329,834
companies in Britain -- mostly small and medium enterprises --
are experiencing some form of financial trouble.

It marks a big increase from the same period last year, Business
Insider notes.  A total of 263,517 companies were in significant
distress in the second quarter of 2016, Business Insider states.
This year's numbers is a 25% increase, Business Insider says.

The report shows 308,423 of those businesses in distress were
SMEs, while around 21,000 were larger businesses, Business
Insider relays.

Ric Traynor, Begbies Traynor's executive chairman, as cited by
Business Insider, said in a statement: "Our Red Flag research
shows that a recent loss of momentum in the economy is putting
increased financial pressure on UK businesses, with SMEs bearing
the brunt of this rising distress, as businesses contend with
uncertainty over Brexit negotiations and an inconclusive election
result, alongside rising costs."

Construction and property companies have seen the biggest spike
in financial troubles, with rises of 22% and 32% respectively,
Business Insider discloses.



                            *********

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.

This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding, electronic
re-mailing and photocopying) is strictly prohibited without prior
written permission of the publishers.

Information contained herein is obtained from sources believed to
be reliable, but is not guaranteed.

The TCR Europe subscription rate is US$775 per half-year,
delivered via e-mail.  Additional e-mail subscriptions for
members of the same firm for the term of the initial subscription
or balance thereof are US$25 each.  For subscription information,
contact Peter Chapman at 215-945-7000 or Joseph Cardillo at
856-381-8268.


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