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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

          Wednesday, January 3, 2018, Vol. 19, No. 002


                            Headlines


G E R M A N Y

BEATE UHSE: Launches Sale Process Following Insolvency
HSH NORDBANK: Jan. 5 Deadline Set for Bidders' Final Offers
* German RMBS 90+ Day Delinquencies Drop 1.3% in October 2017


I R E L A N D

ADAGIO VI: Moody's Assigns B1 Rating to Class F Notes
AQUEDUCT EUROPEAN 2-2017: Moody's Rates Class F Notes 'B2'
CARLYLE EURO 2017-3: Moody's Assigns B1 Rating to Class E Notes
HARBOURMASTER CLO 9: Fitch Hikes Rating on Class E Notes to Bsf
STORM 2016-II: Fitch Upgrades Rating on Class D Notes From B+


K A Z A K H S T A N

KAZAKHTELECOM JSC: Fitch Affirms 'BB+' IDR, Outlook Stable


N E T H E R L A N D S

STEINHOFF INT'L: Moody's Lowers Corporate Family Rating to Caa1


P O L A N D

FERRUM SA: Court Approves Partial Settlement with Creditors


R U S S I A

CB RENAISSANCE: Moody's Withdraws B3 Long-Term Deposit Rating
INTERSTATE BANK: Fitch Assigns BB Long-Term IDR, Outlook Stable
SOVCOMBANK PJSC: Fitch Corrects September 1 Rating Release


S E R B I A

PROCREDIT BANK: Fitch Hikes Long-Term IDR to BB+, Outlook Stable


S W I T Z E R L A N D

ILIM TIMBER: Moody's Assigns B3 CFR, Outlook Stable


U K R A I N E

FERREXPO PLC: S&P Alters Outlook to Pos. & Affirms 'B-' LT CCR


U N I T E D   K I N G D O M

CHELTENHAM SECURITIES: Fitch Rates Class N1 Notes 'B+(EXP)'
INTERSERVE PLC: Tops List of Strategic Supplier in 2017
MALLINCKRODT PLC: S&P Puts 'BB-' CCR on CreditWatch Negative
MIND CANDY: Cut Staff Numbers in 2016 Following Financial Woes


                            *********



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


BEATE UHSE: Launches Sale Process Following Insolvency
------------------------------------------------------
Reuters reports that Beate Uhse AG has launched a sale process.

As reported by the Troubled Company Reporter-Europe on Dec. 18,
2017, Reuters related that German sex shop group Beate Uhse filed
for insolvency after failing to secure financing from a group of
investors.

The company was started in 1946 by a former female pilot with the
same name.


HSH NORDBANK: Jan. 5 Deadline Set for Bidders' Final Offers
-----------------------------------------------------------
Luca Casiraghi at Bloomberg News, citing Spiegel, reports that HSH
Nordbank bidders face a Jan. 5 deadline for final offers.

According to Bloomberg, Spiegel said the deadline for deciding the
winning offer, which could be extended by six months, is
Jan. 15.

The EU deadline for the sale plus six-month grace period is
Feb. 28, Bloomberg notes.

As reported by the Troubled Company Reporter-Europe on May 3,
2016, Bloomberg News related that HSH Nordbank won formal European
Union approval for an increased state guarantee, paving the way
for its sale after it unloads distressed shipping loans to a bad
bank.  The European Commission said the bank will be wound down if
it can't be sold as a viable business that doesn't require further
government help, Bloomberg said, citing an e-mailed statement.

                        About HSH Nordbank

HSH Nordbank -- http://www.hsh-nordbank.com/-- is a commercial
bank in northern Europe with headquarters in Hamburg as well as
Kiel, Germany.  It is active in corporate and private banking.
HSH's main focus is on shipping, transportation, real estate and
renewable energy.


* German RMBS 90+ Day Delinquencies Drop 1.3% in October 2017
-------------------------------------------------------------
The 90+ day delinquencies of German RMBS decreased to 1.3% in
October 2017 from 1.5% in April 2017, according to the latest
German RMBS Performance Update published semi-annually by Moody's
Investors Service.

Transactions are classified into 2 categories: low to medium and
high loan-to-value (LTV). The high LTV transactions include E-MAC
DE series, Eurohome Mortgages 2007-1 plc (German Sub-pool),
Kingswood Mortgages 2015-1 plc and PROVIDE GEMS 2002-1 PLC. While
90+ day delinquencies for high LTV transactions increased to 12.0%
in October 2017 from 10.4% in April 2017, the 90+ day
delinquencies for low to medium LTV transactions remained stable
at 0.1%.

The cumulative loss rate of German RMBS remained largely stable at
1.4% in the same period. The cumulative loss rate for high LTV
transactions increased slightly to 7.3% in October 2017 from 7.0%
in April 2017. However, the cumulative loss rate for low to medium
LTV transactions remained at 0.1%.

As of October 2017, the 10 Moody's-rated German RMBS transactions
had a total outstanding pool balance of EUR8.7 billion, compared
with EUR8.9 billion in April 2017, constituting a decrease of
1.7%.



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


ADAGIO VI: Moody's Assigns B1 Rating to Class F Notes
-----------------------------------------------------
Moody's Investors Service has assigned definitive ratings to seven
classes of notes issued by Adagio VI CLO Designated Activity
Company:

-- EUR205,000,000 Class A Senior Secured Floating Rate Notes due
    2031, Assigned Aaa (sf)

-- EUR32,000,000 Class B-1 Senior Secured Floating Rate Notes
    due 2031, Assigned Aa2 (sf)

-- EUR10,000,000 Class B-2 Senior Secured Fixed Rate Notes due
    2031, Assigned Aa2 (sf)

-- EUR29,500,000 Class C Deferrable Mezzanine Floating Rate
    Notes due 2031, Assigned A2 (sf)

-- EUR19,000,000 Class D Deferrable Mezzanine Floating Rate
    Notes due 2031, Assigned Baa2 (sf)

-- EUR17,300,000 Class E Deferrable Junior Floating Rate Notes
    due 2031, Assigned Ba2 (sf)

-- EUR11,000,000 Class F Deferrable Junior Floating Rate Notes
    due 2031, Assigned B1 (sf)

RATINGS RATIONALE

Moody's definitive ratings of the rated notes address the expected
loss posed to noteholders by the legal final maturity of the notes
in 2031. The definitive ratings reflect the risks due to defaults
on the underlying portfolio of assets, the transaction's legal
structure, and the characteristics of the underlying assets.
Furthermore, Moody's is of the opinion that the Collateral
Manager, AXA Investment Managers, Inc. ("AXA IM"), has sufficient
experience and operational capacity and is capable of managing
this CLO.

Adagio VI is a managed cash flow CLO. At least 90% of the
portfolio must consist of secured senior obligations and up to 10%
of the portfolio may consist of unsecured senior loans, unsecured
senior bonds, second lien loans, mezzanine obligations, high yield
bonds and/or first lien last out loans. At closing, the portfolio
is expected to be comprised predominantly of corporate loans to
obligors domiciled in Western Europe. The remainder of the
portfolio will be acquired during the six months ramp-up period in
compliance with the portfolio guidelines.

AXA IM 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 reinvestment period. Thereafter,
purchases are permitted using principal proceeds from unscheduled
principal payments and proceeds from sales of credit improved and
credit risk obligations, and are subject to certain restrictions.

In addition to the seven classes of notes rated by Moody's, the
Issuer will issue EUR37,000,000 of Subordinated Notes. Moody's
will not assign a rating to this class of notes.

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

Loss and Cash Flow Analysis:

Moody's modeled the transaction using a cash flow model based on
the Binomial Expansion Technique, as described in Section 2.3.2.1
of the "Moody's Global Approach to Rating Collateralized Loan
Obligations" rating methodology published in August 2017.

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.

The key model inputs Moody's used in its analysis, such as par,
weighted average rating factor, diversity score and the weighted
average recovery rate, are based on its published methodology and
could differ from the trustee's reported numbers.

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

Target Par Amount: EUR350,000,000

Diversity Score: 38

Weighted Average Rating Factor (WARF): 2750

Weighted Average Spread (WAS): 3.55%

Weighted Average Recovery Rate (WARR): 43.50%

Weighted Average Life (WAL): 8.50 years

As part of its analysis, Moody's has addressed the potential
exposure to obligors domiciled in countries with local currency
government bond ratings of A1 or below. According to the portfolio
constraints, the total exposure to countries with a local currency
country risk bond ceiling ("LCC") below Aa3 shall not exceed 10%,
the total exposure to countries with an LCC below A3 shall not
exceed 5% and the total exposure to countries with an LCC below
Baa3 shall not exceed 0%. Given this portfolio composition, the
model was run with different target par amounts depending on the
target rating of each class of notes as further described in the
methodology. The portfolio haircuts are a function of the exposure
size to countries with LCC of A1 or below and the target ratings
of the rated notes, and amount to 0.75% for the Class A Notes,
0.50% for the Class B-1 and Class B-2 Notes, 0.375% for the Class
C Notes and 0% for the Class D, Class E and Class F Notes.

Stress Scenarios:

Together with the set of modeling assumptions above, Moody's
conducted an additional sensitivity analysis, which was a
component in determining the definitive ratings 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 the notes (shown
in terms of the number of notch difference versus the current
model output, whereby a negative difference corresponds to higher
expected losses), assuming that all other factors are held equal.

Percentage Change in WARF -- increase of 15% (from 2750 to 3163)

Rating 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 Mezzanine Floating Rate Notes: 0

Class F Deferrable Mezzanine Floating Rate Notes: 0

Percentage Change in WARF -- increase of 30% (from 2750 to 3575)

Class A Senior Secured Floating Rate Notes: 0

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 Mezzanine Floating Rate Notes: -1

Class F Deferrable Mezzanine Floating Rate Notes: 0

Methodology Underlying the Rating Action:

The principal methodology used in these ratings was "Moody's
Global Approach to Rating Collateralized Loan Obligations"
published in August 2017.


AQUEDUCT EUROPEAN 2-2017: Moody's Rates Class F Notes 'B2'
----------------------------------------------------------
Moody's Investors Service announced that it has assigned the
following definitive ratings to notes issued by Aqueduct European
CLO 2-2017 Designated Activity Company:

-- EUR234,000,000 Class A Senior Secured Floating Rate Notes due
    2030, Definitive Rating Assigned Aaa (sf)

-- EUR37,800,000 Class B-1 Senior Secured Floating Rate Notes
    due 2030, Definitive Rating Assigned Aa2 (sf)

-- EUR20,000,000 Class B-2 Senior Secured Fixed Rate Notes due
    2030, Definitive Rating Assigned Aa2 (sf)

-- EUR21,200,000 Class C Senior Secured Deferrable Floating Rate
    Notes due 2030, Definitive Rating Assigned A2 (sf)

-- EUR22,000,000 Class D Senior Secured Deferrable Floating Rate
    Notes due 2030, Definitive Rating Assigned Baa2 (sf)

-- EUR24,000,000 Class E Senior Secured Deferrable Floating Rate
    Notes due 2030, Definitive Rating Assigned Ba2 (sf)

-- EUR12,000,000 Class F Senior Secured Deferrable Floating Rate
    Notes due 2030, Definitive Rating Assigned B2 (sf)

RATINGS RATIONALE

Moody's definitive rating of the rated notes addresses the
expected loss posed to noteholders by the legal final maturity of
the notes in 2030. The definitive 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, HPS Investment
Partners CLO (UK) LLP ("HPS Investment Partners"), has sufficient
experience and operational capacity and is capable of managing
this CLO.

Aqueduct European CLO 2-2017 Designated Activity Company is a
managed cash flow CLO. At least 96% of the portfolio must consist
of senior secured loans and senior secured bonds and up to 4% of
the portfolio may consist of unsecured obligations, second-lien
loans, mezzanine loans and high yield bonds. The bond bucket gives
the flexibility to Aqueduct European CLO 2-2017 Designated
Activity Company to hold bonds. The portfolio is expected to be
approximately at least 65% ramped up as of the closing date and to
be comprised predominantly of corporate loans to obligors
domiciled in Western Europe.

HPS Investment Partners 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 obligations, and are subject to
certain restrictions.

In addition to the seven classes of notes rated by Moody's, the
Issuer will issue EUR18.72m of subordinated M-1 notes, EUR21.1m of
subordinated M-2 notes and EUR0.1m of subordinated M-3 notes,
which will not be rated. To the extent M-2 and M-3 subordinated
notes are held by affiliates of HPS Investment Partners, these
notes will accrue interest in the amount of the senior and
subordinated management fee which would have otherwise been paid
to the collateral manager. In case of a so-called distribution
switch event triggered by the removal and replacement of HPS
Investment Partners as the manager under this transaction, the
transaction will convert back to directly paying fees to the
(third party) collateral manager.

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. HPS Investment Partners' 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 August 2017. 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: EUR400,000,000

Diversity Score: 40

Weighted Average Rating Factor (WARF): 2670

Weighted Average Spread (WAS): 3.20%

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.
As a result and in conjunction with the current foreign government
bond ratings of the eligible countries, as a worst case scenario,
a maximum 10% of the pool would be domiciled in countries with A3.
The remainder of the pool will be domiciled in countries which
currently have a local or foreign currency country ceiling of Aaa
or Aa1 to Aa3.

Stress Scenarios:

Together with the set of modeling assumptions above, Moody's
conducted additional sensitivity analysis, which was an important
component in determining the definitive 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 3071 from 2670)

Ratings Impact in Rating Notches:

Class A Senior Secured Floating Rate Notes: 0

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

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

Class C Senior Secured Deferrable Floating Rate Notes: -2

Class D Senior Secured Deferrable Floating Rate Notes: -2

Class E Senior Secured Deferrable Floating Rate Notes: -1

Class F Senior Secured Deferrable Floating Rate Notes: 0

Percentage Change in WARF: WARF +30% (to 3471 from 2670)

Ratings Impact in Rating Notches:

Class A Senior Secured Floating Rate Notes: 0

Class B-1 Senior Secured Floating Rate Notes: -3

Class B-2 Senior Secured Fixed Rate Notes: -3

Class C Senior Secured Deferrable Floating Rate Notes: -3

Class D Senior Secured Deferrable Floating Rate Notes: -2

Class E Senior Secured Deferrable Floating Rate Notes: -1

Class F Senior Secured Deferrable Floating Rate Notes: -2

Methodology Underlying the Rating Action:

The principal methodology used in these ratings was "Moody's
Global Approach to Rating Collateralized Loan Obligations"
published in August 2017.


CARLYLE EURO 2017-3: Moody's Assigns B1 Rating to Class E Notes
---------------------------------------------------------------
Moody's Investors Service has assigned definitive ratings to eight
classes of debts issued by Carlyle Euro CLO 2017-3 Designated
Activity Company:

-- EUR234,000,000 Class A-1 Senior Secured Floating Rate Notes
    due 2031, Definitive Rating Assigned Aaa(sf)

-- EUR29,500,000 Class A-2-A Senior Secured Floating Rate Notes
    due 2031, Definitive Rating Assigned Aa2(sf)

-- EUR15,000,000 Class A-2-B Senior Secured Fixed Rate Notes due
    2031, Definitive Rating Assigned Aa2(sf)

-- EUR26,500,000 Class B-1 Senior Secured Deferrable Floating
    Rate Notes due 2031, Definitive Rating Assigned A2(sf)

-- EUR10,000,000 Class B-2 Senior Secured Deferrable Floating
    Rate Notes due 2031, Definitive Rating Assigned A2(sf)

-- EUR20,500,000 Class C Senior Secured Deferrable Floating Rate
    Notes due 2031, Definitive Rating Assigned Baa2(sf)

-- EUR23,500,000 Class D Senior Secured Deferrable Floating Rate
    Notes due 2031, Definitive Rating Assigned Ba2(sf)

-- EUR11,100,000 Class E Senior Secured Deferrable Floating Rate
    Notes due 2031, Definitive Rating Assigned B1(sf)

RATINGS RATIONALE

Moody's definitive rating of the rated notes addresses the
expected loss posed to noteholders by the legal final maturity of
the notes in 2031. The definitive 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, CELF Advisors LLP
("CELF Advisors") has sufficient experience and operational
capacity and is capable of managing this CLO.

Carlyle Euro CLO 2017-3 Designated Activity Company is a managed
cash flow CLO. At least 90% of the portfolio must consist of
senior secured loans and senior secured bonds and up to 10% of the
portfolio may consist of unsecured senior loans, second-lien
loans, mezzanine obligations and high yield bonds. The portfolio
is expected to be at least 80% ramped up as of the closing date
and to be comprised predominantly of corporate loans to obligors
domiciled in Western Europe.

CELF Advisors 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 eight classes of notes rated by Moody's, the
Issuer issued EUR43,700,000 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. CELF Advisors' investment decisions and
management of the transaction will also affect the notes'
performance.

Loss and Cash Flow Analysis:

Moody's modelled 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 August 2017. 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 modelling assumptions:

Par Amount: EUR400,000,000

Diversity Score: 43

Weighted Average Rating Factor (WARF): 2950

Weighted Average Spread (WAS): 3.70%

Weighted Average Coupon (WAC): 5.50%

Weighted Average Recovery Rate (WARR): 44%

Weighted Average Life (WAL): 8.5 years

Stress Scenarios:

Together with the set of modelling assumptions above, Moody's
conducted additional sensitivity analysis, which was an important
component in determining the definitive 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 3393 from 2950)

Ratings Impact in Rating Notches:

Class A-1 Senior Secured Floating Rate Notes due 2031: 0

Class A-2-A Senior Secured Floating Rate Notes due 2031: -1

Class A-2-B Senior Secured Fixed Rate Notes due 2031: -1

Class B-1 Senior Secured Deferrable Floating Rate Notes due 2031:
-2

Class B-2 Senior Secured Deferrable Floating Rate Notes due 2031:
-2

Class C Senior Secured Deferrable Floating Rate Notes due
2031: -2

Class D Senior Secured Deferrable Floating Rate Notes due 2031: 0

Class E Senior Secured Deferrable Floating Rate Notes due 2031: 0

Percentage Change in WARF: WARF +30% (to 3835 from 2950)

Ratings Impact in Rating Notches:

Class A-1 Senior Secured Floating Rate Notes due 2031: 0

Class A-2-A Senior Secured Floating Rate Notes due 2031: -2

Class A-2-B Senior Secured Fixed Rate Notes due 2031: -2

Class B-1 Senior Secured Deferrable Floating Rate Notes due
2031: -3

Class B-2 Senior Secured Deferrable Floating Rate Notes due
2031: -3

Class C Senior Secured Deferrable Floating Rate Notes due
2031: -2

Class D Senior Secured Deferrable Floating Rate Notes due
2031: -1

Class E Senior Secured Deferrable Floating Rate Notes due
2031: -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 August 2017.


HARBOURMASTER CLO 9: Fitch Hikes Rating on Class E Notes to Bsf
---------------------------------------------------------------
Fitch Ratings has upgraded three tranches of Harbourmaster 9 CLO
and affirmed one:

Class B: upgraded to 'AAAsf' from 'A+sf'; Outlook Stable
Class C: upgraded to 'Asf' from 'BBB+sf'; Outlook Stable
Class D: affirmed at 'BBsf'; Outlook Stable
Class E: upgraded to 'Bsf' from 'B-sf'; Outlook Stable

KEY RATING DRIVERS

The rating actions reflect the increase in credit enhancement (CE)
across the capital structure due to the transaction's deleveraging
since Fitch last review in January 2017 (CE for class B increased
to 91.34% from 44.04%, for the class C notes to 67.70% from
32.24%, for the class D notes to 36.94% from 16.91% and for the
class E notes to 22.92% from 9.91%). The class A1-VF and A2 notes
have been paid in full. In addition the class B notes have paid
down by EUR38.7 million since the last review.

As the portfolio deleverages, the transaction is becoming more
exposed to obligor concentration. The current portfolio consists
of only 18 obligors from 40 at the last review. The top five
obligors has increased to 47.13% from 27.9%.

As per its criteria, Fitch took into consideration excessive
obligor concentration for the class C, D and E notes as once the
class B notes are repaid the portfolio could consist of fewer than
10 obligors rated in the 'B' category. Consequently the class C
and E notes' upgrade has been limited and Fitch have affirmed the
class D notes, despite the large CE increase.

In addition following the repayment of the multi-currency variable
funding notes class A1-VF, the remaining euro-denominated classes
are exposed to foreign exchange (FX) risk. Approximately 15% of
the portfolio consists of sterling-denominated loans. Depreciation
of the pound sterling compared with the euro will reduce CE for
all classes.

The portfolio credit quality has remained stable overall, with the
weighted average rating factor (WARF) maintained at 31 and the
weighted average recovery rate (WARR) slightly down to 72.6% from
73.0% at last review. All portfolio profile tests, portfolio
quality tests and coverage tests are passing. The transaction is
scheduled to mature in May 2023 and the portfolio's weighted
average life (WAL) has decreased to 3.14 years from 3.7 years on
January 2017.

RATING SENSITIVITIES

A 25% increase in the obligor default probability or a 25%
reduction in expected recovery rates would not lead to rating
actions on the notes.


STORM 2016-II: Fitch Upgrades Rating on Class D Notes From B+
-------------------------------------------------------------
Fitch Ratings has upgraded three tranches of Storm 2016-II and
affirmed one other tranche. The Rating Watch Evolving (RWE) on the
notes has been resolved and the Outlook on all four tranches is
Stable.

The rating actions follow the application of the newly published
European RMBS Rating Criteria.

The transaction comprises residential loans that are originated by
Obvion, a fully owned subsidiary of Cooperatieve Rabobank U.A.
(AA-/Stable/F1+).

KEY RATING DRIVERS

European RMBS Rating Criteria
The application of the new European RMBS Rating Criteria has led
to the upgrade of the class B to D notes.

Stable Pool Composition and Performance
The current pool characteristics have not changed significantly
since close in September 2016. The weighted average (WA) original
loan-to-value (OLTV) is currently at 89.5% (89.2% at close), WA
cumulative LTV at 83.4% (84.6% at close) and debt-to-income DTI
currently at 24.4% (27.2% at close).

There are currently no loans in arrears by more than three months.
Foreclosures as a proportion of the original portfolio balance
remain low at 3bp, while losses stand at 1bp.

Revolving Transaction
The transaction structure includes a five-year revolving period,
to allow new assets to be added to the portfolio. In Fitch's view,
the replenishment criteria adequately mitigate any significant
risk of potential migration due to future loan additions. In its
analysis, Fitch considered a stressed portfolio composition, based
on replenishment criteria, rather than the actual composition.

RATING SENSITIVITIES

Adverse macroeconomic factors may affect asset performance. An
increase in foreclosures and losses beyond Fitch's stresses may
erode credit enhancement leading to negative rating action.

Fitch rates to legal final maturity. At the call option date in
August 2021, as per transaction documentation, the class B to D
notes can be called net of principal deficiency ledger (PDL).
Material principal shortfalls in Fitch's cash flow analysis over
the life of the transaction may trigger rating action.

DATA ADEQUACY

Fitch has checked the consistency and plausibility of the
information it has received about the performance of the asset
pool and the transaction. There were no findings that affected the
rating analysis. Fitch has not reviewed the results of any third-
party assessment of the asset portfolio information or conducted a
review of origination files as part of its ongoing monitoring.

Prior to closing, Fitch reviewed the results of a third-party
assessment conducted on the asset portfolio information and
concluded that there were no findings that affected the rating
analysis.

Prior to the transaction closing, Fitch conducted a review of a
small targeted sample of the originator's origination files and
found the information contained in the reviewed files to be
adequately consistent with the originator's policies and practices
and the other information provided to the agency about the asset
portfolio.

Overall and together with the assumptions referred to above,
Fitch's assessment of the information relied upon for the agency's
rating analysis according to its applicable rating methodologies
indicates that it is adequately reliable.

The rating actions are:

Class A (ISIN: XS1477681255) affirmed at 'AAAsf'; off RWE;
Outlook Stable

Class B (ISIN: XS1477681339) upgraded to 'AA+sf' from 'AA-sf';
off RWE; Outlook Stable

Class C (ISIN: XS1477681503) upgraded to 'Asf' from 'BBB+sf'; off
RWE; Outlook Stable

Class D (ISIN: XS1477682147) upgraded to 'BBBsf' from 'B+sf'; off
RWE; Outlook Stable



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


KAZAKHTELECOM JSC: Fitch Affirms 'BB+' IDR, Outlook Stable
----------------------------------------------------------
Fitch Ratings has affirmed Kazakhtelecom JSC's (Kaztel) Long-Term
Issuer Default Rating (IDR) at 'BB+'. The Outlook on the IDR is
Stable.

Fitch raised the downgrade threshold to 2.5x funds from operations
(FFO) adjusted net leverage, from 2x, after Kazakhtelecom repaid
the US dollar-linked debt instrument in 4Q17, removing a currency
mismatch between revenue and debt. All the outstanding debt is now
in Kazakh tenge.

Kaztel is a strong fixed-line incumbent with dominant market
shares in traditional telephony and fixed-line broadband services,
operating in a benign regulatory environment. The company created
a mobile joint venture with Tele2 that had an about 26% subscriber
market share by end-1H17 and is on track to improve its
profitability due to larger scale and post-integration synergies.

Kaztel's funds from operations (FFO) adjusted net leverage is low,
and unlikely to spike above 2x on the expected acquisition of
Tele2's stake in the mobile joint venture in 2019.

KEY RATING DRIVERS

Strong Incumbent Positions: Fitch expects Kaztel to maintain its
leading position in the fixed-line segment, helped by benign
regulation and a shortage of alternative networks. Kaztel
estimated its fixed-line telephony market share by revenue at a
dominant 93% at end-2016. The company consistently retains above
70% market share in fixed-line broadband (75% by subscribers at
end-2016), where it generates almost half of its total revenue. It
also has a strong position in the pay TV market with a 36% revenue
share, although this is smaller than in other fixed-line segments.
Nevertheless, this segment has the highest growth rates,
supporting overall revenue growth.

Broadband Market: Kazakhstan's broadband market was fully restored
in revenue terms in 2016 after a sharp decline by 11% yoy in 2014.
The market is approaching saturation and revenue growth rates are
likely to slow to low single digits yoy from 2017 from mid-single
digits in 2014-2016. Fixed-line broadband penetration remains low
at 9.2% of households at end-2016, which leaves upside for growth.
Competition is concentrated in large cities where there are
several facilities-based operators. It remains rational, as
indicated by companies' ability to selectively increase prices
without a material impact on their market shares.

Strong Performance in Mobile: Kaztel's mobile JV with Tele2 had
strong performance in 9M17, with its subscriber market share
reaching 26% in 2Q17, up from 25% at end-2016. Competition in the
Kazakhstan mobile market has intensified in recent years and has
been affected by the disruptive behaviour of Beeline and
Tele2/Altel JV, driven by their attempts to increase market
shares. However, the market has largely stabilised in 2017, as
shown by the removal of promotional unlimited offerings and
selective increases in prices that support ARPUs.

Altel and Tele2 continue to operate as separate brands, with the
former targeting premium and home mobile-broadband niches and the
latter remaining a discounter. The JV benefits from its leadership
in 4G coverage and vast distribution network. Fitch expect the
JV's operating and financial performance to improve further as the
company starts benefiting from larger scale and integration
synergies.

Reduced Forex Exposure: Kaztel repaid KZT27 billion of US dollar-
linked notes in 4Q17, fully removing debt exposure to currency
risks. The removal of forex mismatch between debt and EBITDA
drives Fitch decision to relax Fitch downgrade threshold to 2.5x
FFO adjusted net leverage from 2.0x.

Low Leverage, Strong Cash Flow: Fitch expects Kaztel's leverage to
be 0.4x FFO adjusted net leverage by end-2017 (2016: 0.9x) and
decline further in 2018.The company is likely to continue
accumulating cash on its balance sheet in order to have money for
the acquisition of full control in the mobile joint venture in
2019, when Fitch expect Tele2 to execute its put option. The
company's deleveraging is supported by strong free cash flow (FCF)
generation combined with moderate dividends. The company decreased
the amount of guarantees it provides to its mobile JV to KZT17
billion from KZT24 billion in 2017, which also has a positive
impact on Fitch-defined total debt.

Some Restricted Cash: Fitch treat a portion of company's cash as
restricted. Fitch believe that the access to cash held at low-
rated domestic banks remains uncertain and therefore Fitch only
treat cash placed with banks rated 'BB-' and above as available
for debt service, with all other cash treated as restricted and
excluded from net leverage metric calculations. Nevertheless, the
company has been able to use some of its significant cash holdings
with the low-rated banks. Further progress with accessing this
cash would be treated as positive event risk.

Weak Parent-Subsidiary Links: Kaztel's ratings reflect the
company's standalone credit profile. Kaztel is of only limited
strategic importance for Kazakhstan, while operating and legal
ties with its controlling shareholder, the government-controlled
Samruk-Kazyna, are weak. Indirect government control is a positive
credit factor, but it does not justify a rating uplift, in Fitch
view. Kaztel appeared in the government's shortlist for the
privatisation and may be sold to a strategic investor. The change
in the controlling shareholder may have an impact on Kaztel's
ratings subject to the outcome of parent-subsidiary linkage
analysis.

DERIVATION SUMMARY

Kaztel's ratings are driven by the company's strong market
positions in key fixed-line segments, robust FCF generation, low
leverage and a benign regulatory environment. Its peer group
includes Russian fixed-line incumbent Rostelecom PJSC (BBB-
/Stable), mobile operators PJSC Mobile TeleSystems (BB+/Rating
Watch Negative) and PJSC Megafon (BB+/Stable), and PJSC Tattelecom
(BB/Stable), a regional incumbent in the Republic of Tatarstan.

Other close EMEA peers are Turk Telekomunikasyon A.S. (BBB-
/Negative) and Turkcell Iletisim Hizmetleri A.S. (BBB-/Negative).
Kaztel is rated lower than other CIS and EMEA incumbents due to
its smaller scale and a weak domestic financial market resulting
in a lack of liquidity diversification. Kaztel is also rated
higher than the largest Kazakhstan mobile operator Kcell JSC
(BB/Stable).

KEY ASSUMPTIONS

Fitch's key assumptions within the rating case for Kaztel include
the following:

- largely flat revenues in fixed-line in 2017-2020;
- EBITDA margin at 35%-36% in 2017-2018 declining to 32%-33% in
   2019-2020 due to consolidation of less profitable mobile joint
   venture;
- capex intensity ratio at 15%-16% in 2017-2020;
- KZT17 billion of guarantees to mobile JV treated as
   Kazakhtelecom's debt;
- moderate dividend payments at KZT4 billion-7 billion a year in
   2017-2020;
- purchase of the remaining stake in the mobile JV in 2019.

RATING SENSITIVITIES

Future Developments that May, Individually or Collectively, Lead
to Positive Rating Action
- Successful integration with the mobile segment. This is
   unlikely before 2019, when Fitch expects Kaztel to take full
   control over its mobile joint venture with Tele2
- Maintaining sufficient liquidity diversified between external
   and internal sources
- Consistently strong FCF generation with pre-dividend FCF
   margin in mid to high single digits

Future Developments that May, Individually or Collectively, Lead
to Negative Rating Action
- A protracted rise in FFO-adjusted net leverage to above 2.5x
   (end-2016: 0.9x)
- A material increase in refinancing risks driven by
   insufficient liquidity
- Operating underperformance and significant market share
   erosion including in the mobile segment

LIQUIDITY

Strong Liquidity: Kaztel's liquidity is supported by a large
amount of cash holdings and deposits in banks (KZT99 billion at
end-3Q17). Fitch believes the availability of these funds may be
constrained by the quality of some banks and therefore treats cash
held in banks with ratings at or below 'B+' and unrated banks as
restricted. Fitch expects Kaztel to generate robust FCF, which is
likely to accumulate on the company's balance sheet ahead of the
potential execution of a put option related to the mobile joint
venture. The company does not face any substantial debt maturities
in 2018. Therefore Fitch consider overall liquidity as strong.

FULL LIST OF RATING ACTIONS

Kazakhtelecom JSC

Long-Term Foreign and Local IDRs: affirmed at 'BB+', Outlook
Stable

Short-Term Foreign Currency IDR: affirmed at 'B'

National Long-Term Rating: affirmed at 'AA-(kaz), Outlook Stable

Senior unsecured debt: affirmed at 'BB+'

Senior unsecured debt in local currency: affirmed at 'AA-(kaz)'



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


STEINHOFF INT'L: Moody's Lowers Corporate Family Rating to Caa1
---------------------------------------------------------------
Moody's Investors Service has downgraded the ratings of Steinhoff
International Holdings N.V. (Steinhoff) and Steinhoff Investment
Holdings Limited by assigning Caa1 Corporate Family Ratings to the
two companies and B3.za national scale Corporate Family Rating to
Steinhoff Investment Holdings Limited.

At the same time, Moody's downgraded the backed senior unsecured
notes rating of Steinhoff Europe AG to Caa1 from B1.

Moody's has also assigned Caa1-PD probability of default ratings
(PDR) to Steinhoff and Steinhoff Investment Holdings Limited.

Concurrently, and in line with Moody's practice for corporates
with non-investment-grade-ratings, Moody's withdrew the B1 issuer
rating assigned to Steinhoff and B1/Baa3.za issuer ratings
assigned to Steinhoff Investment Holdings Limited.

All the ratings remain under review for further downgrade.

RATINGS RATIONALE

Steinhoff's CFR and Moody's review of its CFR for further
downgrade reflect the increasing pressure on the company's
liquidity profile. The situation has been compounded by its
operating companies placing an additional liquidity burden on
Steinhoff's centralized treasury function to fund their working
capital needs. Moody's notes that the operating companies have
experienced a reduction or cancelation of credit insurance lines
in recent weeks, with credit facilities increasingly being
suspended or withdrawn.

Consequently, Steinhoff's liquidity levels could prove
insufficient to sustain its European operations in the near term
if it is unable to shore up its cash balances or other sources of
liquidity.

Moody's recognizes that the company maintains various means with
which to strengthen its liquidity profile. For example, Steinhoff
is seeking to improve credit insurance coverage, raise new credit
facilities at its operating companies and repatriate cash proceeds
from the sale of listed equity investments in South Africa.
However, the timing and proceeds of these measures is uncertain at
this time.

The CFR also takes into consideration the company's substantial
debt maturities during 2018, amounting in aggregate to EUR1.47
billion as reported by the company. The ongoing investigations
into Steinhoff's alleged accounting irregularities could make it
challenging to either repay or refinance these debt maturities.

Steinhoff's CFR continues to incorporate its: 1) large scale; 2)
business and geographic diversity; 3) concentration of EBITDA in
Europe; and 4) the likely volume-driven cost benefits from its
position as a large-scale vertically integrated retailer. The
rating also considers Steinhoff's other strengths, including its
market share in the mass discount market, where it has been
growing revenues. Specifically, the company's operational profile
reflects its exposure to the better performing economies in
Europe.

The rating recognizes the financial flexibility offered by
Steinhoff's listed investments and its predominantly unencumbered
European property portfolio spanning retail, warehousing and
manufacturing. However, under the current circumstances, Steinhoff
may not be able to monetize these assets in a timely manner.

The assessment of Steinhoff's credit profile is made difficult by
its complex corporate legal structure and financial reporting
considerations, which are a result of the company's rapid
expansion through acquisitions.

The opacity has been further exacerbated by the uncertainty around
accounting irregularities that its Board had flagged on 6 December
2017. This situation has resulted in an independent investigation,
as well as confirmation by Steinhoff, on the advice of the
independent committee of the Supervisory Board, that the 2016
financial statements will have to be restated, with the
possibility that results for prior years may also be restated.

Moody's review will focus on Steinhoff's liquidity profile and its
ability to address debt obligations in the course of 2018. Its
rating could come under further downward pressure if it cannot
address these near term demands.

Based on its financial report for the six months ended March 31,
2017, Steinhoff Europe AG, which is 100% owned by Steinhoff,
reported total revenue of approximately EUR6 billion.

Steinhoff Europe AG is the issuing entity for the EUR800 million
1.875% notes due 2025 and guaranteed by Steinhoff. Steinhoff
Europe AG is directly held by Steinhoff Mîbel Holding Alpha GmbH,
which in turn is held by Steinhoff Finance Holding GmbH. All three
of these entities are 100% owned by Steinhoff.

The principal methodology used in these ratings was Retail
Industry published in October 2015.


===========
P O L A N D
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FERRUM SA: Court Approves Partial Settlement with Creditors
-----------------------------------------------------------
Reuters reports that Ferrum SA said on Jan. 2 that a court has
approved its partial settlement agreement with creditors.

According to Reuters, the company said the court has included into
the partial settlement Fundusz Inwestycji Polskich Przedsiebiorstw
Fundusz Inwestycyjny Zamkniety Aktywow Niepublicznych, Mezzanine
Fundusz Inwestycyjny Zamkniety Aktywow Niepublicznych and Watchet
Sp. z o.o.

It said the court's decision is not valid.

Ferrum S.A. manufactures and sells pipes for transmission media in
Poland.



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


CB RENAISSANCE: Moody's Withdraws B3 Long-Term Deposit Rating
-------------------------------------------------------------
Moody's Investors Service has withdrawn CB Renaissance Credit
LLC's following ratings:

- Long-term local- and foreign-currency deposit rating of B3

- Local-currency Senior Unsecured debt rating of B3

- Foreign-currency Subordinate debt rating of Caa1

- Short-term local and foreign-currency deposit ratings of Not
   Prime

- Long-term Counterparty Risk Assessment of B2(cr)

- Short-term Counterparty Risk Assessment of Not Prime(cr)

- Baseline credit assessment (BCA) and adjusted BCA of b3

At the time of the withdrawal, all the bank's long-term ratings
carried a stable outlook.

RATINGS RATIONALE

Moody's has decided to withdraw the ratings for its own business
reasons.

CB Renaissance Credit LLC is a Russia-based bank focused on
unsecured consumer lending to mass-market retail customers
Headquartered in Moscow, Russia, the bank reported total assets of
RUB118 billion and shareholders' equity of RUB21.7 billion as of 1
October 2017.


INTERSTATE BANK: Fitch Assigns BB Long-Term IDR, Outlook Stable
---------------------------------------------------------------
Fitch Ratings has assigned Interstate Bank a Long-Term Issuer
Default Rating of 'BB' with a Positive Outlook.

KEY RATING DRIVERS

The rating and Positive Outlook reflect the following key rating
drivers:

Interstate Bank is rated by Fitch as a Supranational
Administrative Body (SAB) and, in line with Fitch published
criteria, the rating is support-driven and takes into account the
average rating of key shareholders (Russia: BBB-/Positive). A two-
notch downward adjustment from Russia's rating is applied to
reflect Fitch assessment of the propensity of the key shareholder
to provide support.

Interstate Bank, located in Moscow, was founded in January 1993 by
10 member states of the Commonwealth of Independent States (CIS):
Armenia (B+/Positive), Belarus (B-/Positive), Kazakhstan
(BBB/Stable), Kyrgyz Republic, Moldova, Russia, Tajikistan,
Turkmenistan, Uzbekistan and Ukraine (B-/Stable). Uzbekistan,
however, left the bank in 2012, withdrawing its capital and all
operational involvement.

Interstate Bank is an international cross-border settlement
institution operating in the CIS and the Eurasian Economic Union.
The bank receives deposits, in roubles, from regional central
banks and international organisations and, at any given point, is
then asked to process payments from its depositors to their
counterparties. All deposits are held 'on demand'.

About 43% of the bank's total assets are held as very short-term
money market deposits, mostly overnight with interest rates
prevailing on the interbank market, currently at between 7.6% -
8.35%, as the bank needs highly liquid assets to match its highly
liquid liabilities. These short-term deposits are held in roubles
with a credit quality ranging from 'BBB' to 'B-'.

Interstate Bank has no loans, apart from staff loans which
represent only 0.1% of the bank's assets. There are currently no
guarantees issued by the bank, it does not provide trade
financing, does not take part in any co-financing, and is not
involved in concessional lending, project finance nor loans to
SMEs. The bank's business model is not expected to change in the
foreseeable future. As such, Interstate Bank's rating is anchored
by Fitch's assessment of support rather than the bank's intrinsic
profile.

As Interstate Bank has no callable capital and no debt, in line
with its criteria Fitch bases its support assessment on the
average rating of key shareholders. Interstate Bank has one key
shareholder, Russia, which owns 50% of the bank's capital, making
Russia's rating the foundation of Interstate Bank's rating. The
rating is then notched down twice to reflect partly the relative
ease with which member states can withdraw from the bank, as
evidenced by Uzbekistan's departure in 2012. Withdrawal from the
bank incurs no penalties or sanctions and a departing member's
share of paid-in capital would be repaid to them following
completion of the required six months' notice period.

The notching also factors in the small size of the bank relative
to the region's economy and the limited role the bank plays in the
financing of key projects in member states. Although Interstate
Bank facilitates forum discussions for CIS / national banks that
are supported by members, in Fitch's view this role is not
relevant to Fitch assessment of support.

RATING SENSITIVITIES

The main factors that could, individually or collectively, lead to
an upgrade are:

- An upgrade of the Russian sovereign rating, which would
   reflect an improvement of capacity to support.

- A positive change to Fitch assessment of Russia's propensity
   to support the bank.

Conversely, the main factors that could, individually or
collectively, lead to a negative rating action, are:

- A downgrade of the Russian sovereign rating or revision of its
   Outlook to Stable or Negative.

- A negative change to Fitch assessment of Russia's propensity
   to support the bank.

KEY ASSUMPTIONS

The ratings and Outlook are sensitive to a number of assumptions:

- Russia continues to own at least 50% of Interstate Bank and
   that this share is not diluted;
- No deviation from the current strategy of Interstate Bank;
- Risk management policies will remain unchanged and no breach
   is expected.


SOVCOMBANK PJSC: Fitch Corrects September 1 Rating Release
----------------------------------------------------------
Fitch Ratings has issued a correction to the ratings release on
PJSC Sovcombank published on September 1, 2017, which omitted the
summary of financial statement adjustments.

The revised release is as follows:

Fitch Ratings has affirmed PJSC Sovcombank's (SCB) Long-Term
Issuer-Default Ratings (IDRs) at 'BB-'. The Outlook is Stable.

KEY RATING DRIVERS

The ratings reflect the strong financial metrics of SCB,
especially its long record of sound asset quality and robust
performance, as well as its recent rapid growth and niche
franchise.

At end-1H17, SCB's reported NPLs were a low 2.4% of gross loans
and were mainly attributable to the bank's unsecured consumer
lending (24% of total loans). The non-retail book was mainly
represented by granular, low to moderate risk exposures to Russian
sub-sovereigns and municipalities and top tier companies, which
are predominantly state-owned or highly rated (BB rating category
or higher). The quality of the bond portfolio (around 56% of total
assets, including those recognised in loans to customers) is also
strong as 86% of bonds are rated 'BB' or higher.

Fitch views SCB's core performance as robust, despite around 30%
of operating profit in 1H17 being derived from positive mark-to-
market (MTM) revaluation of the bond portfolio, which is a non-
recurring income source. Even net of these MTM gains and other
one-off items (the largest one being the gain from the acquisition
of Express Volga Bank in 2016) annualised return on average equity
for 1H17 and 2016 was solid at 30% and 38%, respectively.

Over the last 12 months, SCB has significantly mitigated interest
rate risk stemming from its sizable bond portfolio by entering
into long-term interest rate swaps in US dollars with large,
highly-rated banks with a total notional amount of USD1.1 billion
(RUB65 billion equivalent), which hedges around 70% of the
potential fair value movement in the US dollar-denominated bonds
(53% of trading portfolio at end-1H17). Interest rate risk is
additionally mitigated by the significant capital buffer relative
to potential MTM losses and the bank's track record of managing
this risk.

Market risk also stems from the bank's sizable open long on-
balance sheet currency position, reflecting sizable investments in
USD-denominated bonds financed by rouble customer deposits.
However, in July 2017 SCB entered into sizable one-year currency
swaps with large, highly-rated Russian banks, replacing short-term
swaps with maturities of up to two weeks, which has moderated
currency risk, in Fitch's view.

SCB's capital position has been gradually improving due to
moderate loan growth (CAGR of 20% in 1H17-2016 after rapid
expansion in 2014-2015) and healthy internal capital generation
(about 40% for the same period) and the Fitch Core Capital ratio
was a reasonable 13.5% at end-1H17. The bank's significant
investments in the smaller Rosevrobank (BB-/Stable/bb-) have so
far put limited pressure on SCB's capital position. Fitch believes
SCB could gradually increase its stake in Rosevrobank without a
significant reduction in capital ratios, given its strong internal
capital generation and the potential to deleverage through bond
sales, if required.

SCB has predominantly been funded by fairly granular retail
deposits (50% of total liabilities at end-1H17) and secured repo
borrowings from large Russian banks (a further 34% of
liabilities). Liquidity is supported by a sizable liquidity
cushion, including cash and unpledged securities (29% of end-1H17
total liabilities), and part of the loan book (9% of liabilities)
could also be pledged to raise funding from the Central Bank of
Russia.

SCB's senior unsecured debt rating is aligned with the bank's
Long-Term Local-Currency IDR, reflecting Fitch's view of average
recovery prospects, in case of default.

The '5' Support Rating and 'No Floor' Support Rating Floor reflect
Fitch's view that support from either the bank's shareholders or
the Russian authorities could not be relied upon, in case of need.

RATING SENSITIVITIES

An upgrade of SCB's ratings would require further development of
the bank's franchise and a track record of more balanced, moderate
growth.

Downside could stem from sharp deterioration in asset quality
leading to material capital erosion, or mismanagement of liquidity
and market risks arising from the bank's trading activities.

The rating actions are:

PJSC Sovcombank

Long-Term Foreign and Local Currency IDRs: affirmed at 'BB-';
Outlooks Stable

Short-Term Foreign Currency IDR: affirmed at 'B'

Viability Rating: affirmed at 'bb-'

Support Rating: affirmed at '5'

Support Rating Floor: affirmed at 'No Floor'

Senior unsecured debt: affirmed at 'BB-'



===========
S E R B I A
===========


PROCREDIT BANK: Fitch Hikes Long-Term IDR to BB+, Outlook Stable
----------------------------------------------------------------
Fitch Ratings has upgraded ProCredit Bank ad Beograd's (PCBS)
Long-Term Foreign Currency Issuer Default Rating (IDR) to 'BB+'
from 'BB-'. It has also upgraded PCBS's Long-Term Local Currency
IDR to 'BB+' from 'BB'. The Outlooks on the Long-Term Foreign and
Local Currency IDRs are Stable. The bank's VR is unaffected by
this rating action.

The upgrade of the IDRs follows Fitch's rating action on Serbia
which resulted in an upgrade of its Country Ceiling to 'BB+' from
'BB-' (see also: 'Fitch Upgrades Serbia to 'BB'; Outlook Stable').

KEY RATING DRIVERS

IDRS AND SUPPORT RATING

The bank's IDRs and Support Rating are driven by the support the
bank may receive from ProCredit Holding AG&Co. KGaA (PCH,
BBB/Stable), its 100% owner. Support considerations include the
strategic importance of south-east Europe to PCH and the negative
implications of any subsidiary default.

However, the extent to which such support can be factored into the
ratings is constrained by the Serbian Country Ceiling. Absent of
this constraint, support considerations would typically be
reflected in a one-notch differential between the rating of the
parent, PCH, and PCBS.

The Stable Outlooks on PCBS's IDRs reflect those on Serbia's Long-
Term Foreign and Local Currency IDRs.

RATING SENSITIVITIES

IDRS AND SUPPORT RATINGS

Changes to Serbia's sovereign rating, currently not expected given
the Stable Outlook, accompanied by a revision of the Country
Ceilings, would affect PCBS's IDRs.

The rating actions are:

PCBS

Long-Term Foreign Currency IDR upgraded to 'BB+' from 'BB-';
Outlook Stable

Short-Term Foreign Currency IDR affirmed at 'B'

Long-Term Local Currency IDR upgraded to 'BB+' from 'BB'; Outlook
Stable

Short-Term Local Currency IDR affirmed at 'B'

Support Rating affirmed at '3'

Viability Rating of 'bb-' is unaffected



=====================
S W I T Z E R L A N D
=====================


ILIM TIMBER: Moody's Assigns B3 CFR, Outlook Stable
---------------------------------------------------
Moody's Investors Service has assigned a corporate family rating
(CFR) of B3 and a probability of default rating (PDR) of B3-PD to
Ilim Timber Continental S.A. (Ilim Timber), a leading softwood
sawn timber producer domiciled in Switzerland with operating
facilities in Russia and Germany. The outlook on the ratings is
stable.

RATINGS RATIONALE

Ilim Timber's B3 rating factors in (1) elevated leverage, with
Moody's-adjusted debt/EBITDA of 6.4x as of 30 June 2017 (4.6x at
year-end 2016), along with Moody's expectations that it will
remain above 4.0x over the next 12-18 months; (2) low product
portfolio diversification, as ca 72% of the company's sales
represented by sawn timber, a market characterized by seasonality
and volatility in terms of volumes and prices; (3) highly
concentrated ownership, which creates the risk of rapid changes in
the company's strategy and development plans, along with the risk
of revisions to its financial policies, or change in shareholder
distributions (albeit mitigated by dividend restrictions under
existing debt facilities); (4) material amount of a debt funded
loan to the shareholder; (5) weakened financial performance during
1H 2017 with Moody's-adjusted EBITDA falling to $23 million,
compared with $43 million during 1H 2016; (6) fairly small size on
a global scale, reflected by revenue of $568 million in the last
12-month period through 30 June 2017; (7) volatile spreads between
cost of logs and sawn timber prices, resulting in volatile
profitability; and (8) exposure to an emerging market (Russia)
operating environment with a less developed regulatory, political
and legal framework, although limited to 30% of annual revenue.

At the same time, the rating is supported by (1) geographic
diversification of assets as two mills are located in Germany and
other two mills in Eastern Siberia, Russia, that result in two
operationally independent business divisions; (2) production
assets' proximity to reliable and accessible raw materials supply
and established distribution infrastructure; (3) diversified
customer base, with no single customer accounting for more than 6%
of the company's total sales in 2017; (4) well-invested modern saw
mills in Germany requiring low maintenance capex; (5) the
company's second-largest position as sawn timber producer in
Europe; (6) strong industry fundamentals with increasing prices
supported by demand from US, Europe and China; (7) management's
track record of ramping up operations at new assets; (8) financial
policy aimed at deleveraging, although shaped by covenants and
limitations under $344 million outstanding loans, and (9) adequate
liquidity with low principal repayments scheduled over the next
two years and manageable maintenance capex.

The rating also takes into account the risk that the current
restrictive bank covenant package -- which prohibits shareholder
distributions, related party transaction and imbeds deleveraging
targets - might change and potentially loosen over time as Ilim
Timber progresses with optimisation of its debt portfolio and
addresses, albeit remote at this point, refinancing risk related
to its $273 million balloon loan repayment due in June 2020.
Potential evolution of the company's debt portfolio and related
covenants can potentially negatively impact the company's
financial policies and be credit negative.

RATIONALE FOR THE STABLE OUTLOOK

The stable outlook reflects Moody's expectation that in the next
12 months Ilim Timber will (1) reduce its Moody's-adjusted
debt/EBITDA to below 6.0x on a sustainable basis; (2) continue to
generate positive free cash flow; (3) maintain adequate liquidity;
and (4) prioritise deleveraging over shareholder distributions and
expansion capex.

WHAT COULD CHANGE THE RATING UP/DOWN

Moody's could upgrade the rating if the company were to (1) reduce
its Moody's-adjusted debt/EBITDA below 4.5x and increase EBITDA
interest coverage above 2.5x on a sustainable basis; (2) maintain
adequate liquidity; and (3) pursue conservative financial
policies.

Moody's could downgrade the rating if the company's (1) Moody's-
adjusted debt/EBITDA were to rise above 7.0x on a sustainable
basis; (2) operating performance, cash generation or market
position were to weaken materially; or (3) liquidity were to
deteriorate and the company failed to address the upcoming debt
maturities in a timely fashion.

PRINCIPAL METHODOLOGY

The principal methodology used in these ratings was Global Paper
and Forest Products Industry published in October 2013.

Switzerland-based Ilim Timber is one of the largest softwood sawn
timber producer in Europe. The company operates two facilities in
Germany and two in Russia, with total annual production capacity
of 2,600,000 cubic meters of sawn timber and 230,000 cubic meters
of plywood. In in the last 12-month period through 30 June 2017,
Ilim Timber reported revenues of $568 million, of which 72% was
derived from sawn timber, 16% from by-products and 12% from
plywood segment, and Moody's-adjusted EBITDA of $54 million. The
company generates 70% of its revenue from operations in Germany
and 30% - from mills in Russia. Ilim Timber is controlled by
Russian businessmen Boris and Mikhail Zingarevich.



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


FERREXPO PLC: S&P Alters Outlook to Pos. & Affirms 'B-' LT CCR
--------------------------------------------------------------
S&P Global Ratings said that it revised its outlook on Ukraine-
based iron ore pellet producer Ferrexpo PLC to positive from
stable. At the same, S&P affirmed its 'B-/B' long- and short-term
corporate credit ratings on the company.

S&P also affirmed its 'B-' long-term rating on the senior
unsecured debt issued by Ferrexpo Finance PLC.

The outlook revision reflects the supportive iron ore pellet
market, which suggests 2018 will be another strong year for
Ferrexpo. The outlook also reflects the improvement in its
liquidity profile with the signing of a new $195 million pre-
export finance (PXF) facility last month.

Strong demand for and tight supply of iron ore pellets have
resulted in healthy cash flow generation, enabling Ferrexpo to
continue deleveraging and meet all of its debt repayment
obligations from internal cash flow generation. Early indications
suggest that the supportive pellet market conditions will continue
in 2018, which means the company should easily cover its upcoming
debt maturities over the next 12 months. The new $195 million PXF
facility further boosts the company's liquidity profile and
ensures it is able to meet sizable debt maturities of about $350
million over the coming 12 months.

S&P said, "We anticipate that the iron ore pellet market will
remain tight in 2018, as Brazilian pellet producer Samarco's
pelletizing plant remains idle and stricter environmental
regulations in China force iron ore producers to use more
pelletized iron ore as feedstock in the steelmaking process. We
understand that some large industry players have agreed premiums
for a material portion of their 2018 capacity, and early
indications suggest annual increase of $15/ton-$20/ton. We
understand a $1/ton change in sales prices changes Ferrexpo's
EBITDA by slightly more than $10 million. The medium-term (2019-
2020) outlook is less certain however, as the higher prices may
trigger capacity additions, and our base-case expectation is for
iron ore prices and pellet premiums to decline in 2019. We do
however consider there to be some flexibility in the company's
capital expenditure (capex) plans and shareholder distributions in
case of weaker market conditions.

"We expect a lower iron ore (fines) price in 2018 ($55/ton),
however, reflecting our view that the market is likely to be in
surplus due to increasing seaborne supply from Australia and
Brazil. In addition, growth momentum in Chinese downstream sectors
like property and manufacturing could slow in the next 12-24
months from their strong levels in 2017."

Under its base-case scenario, S&P projects that Ferrexpo's S&P
Global Ratings-adjusted EBITDA will be over $500 million in 2017
and 2018, reflecting higher iron ore pellet premiums, compared to
$364 million in 2016. The following assumptions underpin these
estimates:

-- Iron ore price of $55/ton for the rest of 2017 and 2018.

-- Iron ore pellets premium of $40/ton in 2017 and $50/ton in
    2018.

-- Shipping volumes of 10.3 million tons in 2017 and 10.8
    million tons in 2018, consisting of high-grade products (65%
    ferrous content).

-- An increase in the unit cash costs in line with our inflation
    assumption for Ukraine (8.7% for 2018).

-- Ukrainian hryvnia to U.S. dollar exchange rate of 26.6 for
    2017 and 27.1 for 2018.

-- Capex of $100 million-$130 million per annum in 2017 and
    2018.

-- Ordinary and special dividends of $80 million.

These assumptions translate into an adjusted debt-to-EBITDA ratio
of around 1x in 2017 and 2018.

S&P said, "Following the strong performance in 2017 and the new
PXF facility, we consider that the company's ability to withstand
a sovereign default has improved. This assessment takes into
account the fact that all of Ferrexpo's sales are from exports,
giving it good access to hard currency. In addition, most cash is
held outside of Ukraine, and committed credit facilities from
international lenders are likely to remain in place under a
sovereign stress scenario. We would need to be convinced that the
stronger liquidity position is also sustainable under weaker
market conditions before we could rate the company above Ukraine.

"The positive outlook signifies a one-in-three chance of raising
the rating over the coming 12 months. The outlook reflects our
expectation of supportive market conditions in 2018 leading to an
improvement in the company's liquidity position and capital
structure.

"We could raise the rating on Ferrexpo in 2018 once we get greater
visibility on pellet premiums and the consequent benefits to the
company's capital structure and liquidity profile. A higher rating
depends on us assessing that Ferrexpo's liquidity position is
sufficiently robust to withstand a sovereign default, since an
upgrade would result in Ferrexpo being rated above Ukraine. For a
higher rating, we would also look for the company's debt-to-EBITDA
ratio remaining sustainably below 2x (the actual figure was 1.2x
for the rolling 12 months to June 30, 2017)."

A sovereign upgrade could also result in an upgrade of Ferrexpo.

S&P said, "We could revise the outlook back to stable if we do not
believe that Ferrexpo's liquidity position and access to hard
currencies are sufficient to meet its debt service obligations in
a sovereign default scenario." This could be the case if market
conditions weaken, triggering lower-than-expected pellet premiums
and iron ore prices. It could also result from an escalation of
country risk in Ukraine having a negative impact on Ferrexpo's
operations, or from higher-than-expected dividends or capex."

A sovereign downgrade could also result in a negative rating
action on Ferrexpo.



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


CHELTENHAM SECURITIES: Fitch Rates Class N1 Notes 'B+(EXP)'
-----------------------------------------------------------
Fitch Ratings has assigned Cheltenham Securities 2017 Limited's
hypothetical notes expected ratings:

GBP372.3 million Class A1 (credit enhancement (CE) of GBP144.8
million):'AAA(EXP)sf'; Outlook Stable

GBP10.3 million Class A2 (CE of GBP134.4 million): 'AAA(EXP)sf';
Outlook Stable

GBP2.7 million Class B1 (CE of GBP131.7 million): 'AA+(EXP)sf';
Outlook Stable

GBP2.7 million Class B2 (CE of GBP129 million): 'AA+(EXP)sf';
Outlook Stable

GBP2.7 million Class B3 (CE of GBP126.3 million): 'AA+(EXP)sf';
Outlook Stable

GBP2.7 million Class B4 (CE of GBP123.6 million): 'AA+(EXP)sf';
Outlook Stable

GBP2.3 million Class C1 (CE of GBP121.3 million): 'AA(EXP)sf';
Outlook Stable

GBP2.3 million Class C2 (CE of GBP118.9 million): 'AA(EXP)sf';
Outlook Stable

GBP2.1 million Class C3 (CE of GBP116.9 million): 'AA(EXP)sf';
Outlook Stable

GBP2.6 million Class D1 (CE of GBP114.3 million): 'AA-(EXP)sf';
Outlook Stable

GBP2.6 million Class D2 (CE of GBP111.7 million): 'AA-(EXP)sf';
Outlook Stable

GBP2.6 million Class E1 (CE of GBP109.1 million): 'A+(EXP)sf';
Outlook Stable

GBP2.6 million Class E2 (CE of GBP106.5 million): 'A+(EXP)sf';
Outlook Stable

GBP2.6 million Class E3 (CE of GBP103.9 million): 'A+(EXP)sf';
Outlook Stable

GBP2.6 million Class E4 (CE of GBP101.3 million): 'A+(EXP)sf';
Outlook Stable

GBP3.6 million Class E5 (CE of GBP97.7 million): 'A+(EXP)sf';
Outlook Stable

GBP2.3 million Class F1 (CE of GBP95.4 million): 'A(EXP)sf';
Outlook Stable

GBP2.3 million Class F2 (CE of GBP93.1 million): 'A(EXP)sf';
Outlook Stable

GBP3.1 million Class G1 (CE of GBP90 million): 'A-(EXP)sf';
Outlook Stable

GBP2.6 million Class H1 (CE of GBP87.4 million): 'BBB+(EXP)sf';
Outlook Stable

GBP2.6 million Class H2 (CE of GBP84.8 million): 'BBB+(EXP)sf';
Outlook Stable

GBP2.6 million Class H3 (CE of GBP82.2 million): 'BBB+(EXP)sf';
Outlook Stable

GBP2.6 million Class H4 (CE of GBP79.6 million): 'BBB+(EXP)sf';
Outlook Stable

GBP2.6 million Class H5 (CE of GBP77 million): 'BBB+(EXP)sf';
Outlook Stable

GBP2.6 million Class H6 (CE of GBP74.5 million): 'BBB+(EXP)sf';
Outlook Stable

GBP1.6 million Class H7 (CE of GBP72.9 million): 'BBB+(EXP)sf';
Outlook Stable

GBP3.1 million Class I1 (CE of GBP69.8 million): 'BBB(EXP)sf';
Outlook Stable

GBP2.3 million Class J1 (CE of GBP67.5 million): 'BBB-(EXP)sf';
Outlook Stable

GBP2.3 million Class J2 (CE of GBP65.2 million): 'BBB-(EXP)sf';
Outlook Stable

GBP2.6 million Class K1 (CE of GBP62.6 million): 'BB+(EXP)sf';
Outlook Stable

GBP2.6 million Class K2 (CE of GBP60 million): 'BB+(EXP)sf';
Outlook Stable

GBP2.6 million Class K3 (CE of GBP57.4 million): 'BB+(EXP)sf';
Outlook Stable

GBP2.6 million Class K4 (CE of GBP54.8 million): 'BB+(EXP)sf';
Outlook Stable

GBP2.6 million Class K5 (CE of GBP52.2 million): 'BB+(EXP)sf';
Outlook Stable

GBP2.6 million Class K6 (CE of GBP49.6 million): 'BB+(EXP)sf';
Outlook Stable

GBP2.1 million Class K7 (CE of GBP47.6 million): 'BB+(EXP)sf';
Outlook Stable

GBP2.6 million Class L1 (CE of GBP45 million): 'BB(EXP)sf';
Outlook Stable

GBP1.6 million Class M1 (CE of GBP43.4 million): 'BB-(EXP)sf';
Outlook Stable

GBP0.8 million Class N1 (CE of GBP42.7 million): 'B+(EXP)sf';
Outlook Stable

GBP42.7 million Class O1 (CE of GBP0 million): 'NR(EXP)'; Outlook
Stable

The transaction is a synthetic securitisation of GBP517.1million
unfunded credit default swaps (CDS), referencing loans granted to
UK mid-market companies active in different economic sectors. The
referenced portfolio comprises mid-market loans (56%) and
leveraged finance acquisition loans (44%). The loans are senior
secured and were originated by Lloyds Bank plc (A+/Stable/F1).

Following a credit event (failure to pay, bankruptcy or
restructuring) in the reference portfolio, the issuer will pay a
percentage of the defaulted notional to the beneficiary as the
initial loss amount. The initial loss percentage will be 45%. The
realised loss will then be established by determining the actual
recoveries received by the originator when no future recovery is
expected. An independent verification agent will verify the final
loss amount.

The net protection payment amount will be the difference between
the initial loss and the realised loss, which could be positive or
negative. In the latter case, if the realised loss is less than
initial loss percentage then the beneficiary is required to pay
back the net protection payment amount. However, this is not
expected in a stress scenario when the beneficiary becomes
insolvent as Fitch's expected losses are much higher than the
initial loss percentage.

Fitch's expected ratings on the hypothetical notes address the
likelihood of a claim being made if the beneficiary were to enter
into these CDS agreements.

KEY RATING DRIVERS

'B+'/'B' Portfolio Credit Quality: Based on the bank internal
ratings and the financial ratios of the underlying obligors, Fitch
views the average credit quality of the mid-market sub-portfolio
to be in the 'BB-' rating category and the leverage acquisition
finance sub-portfolio to be in the 'B-' rating category. The
median gross debt to EBITDA ratios are 1.6 and 2.5 for the mid-
market sub-portfolio and the leveraged acquisition finance sub-
portfolio, respectively.

High Recovery Expectation: Fitch considers the whole portfolio as
senior secured with an average recovery expectation in line with
'RR3' (51-70%). Fitch reviewed the loans security package, which
Fitch deemed to be in line with market practice compared with the
European broadly syndicated leveraged loan market. However, given
the limited recovery information provided by the originator, Fitch
assumed a recovery expectation lower than the standard criteria
assumption for senior secured loans in the UK.

Short Duration: The transaction is static with 55% of the
portfolio amortising. The weighted average life of the transaction
is approximately three years.

Diversified Portfolio: The securitised portfolio is well
diversified across industry with limited exposure to a single
obligor. The largest issuer represents 1.4% of the portfolio while
the top 10 represent 14% of the portfolio. The largest reference
industry is business services (13%), followed by retail (10%) and
transportation and distribution (8%).

RATING SENSITIVITIES

Increasing the default probabilities assigned to the underlying
obligors by 25% could result in a downgrade of up to three
notches.

Decreasing the recovery rates assigned to the underlying obligors
by 25% could result in a downgrade of up to five notches.


INTERSERVE PLC: Tops List of Strategic Supplier in 2017
-------------------------------------------------------
Rhiannon Bury at The Telegraph reports that Interserve has topped
the list of the Government's strategic suppliers in 2017 despite a
turbulent few months in which it risked breaching its debt
covenants and halved its profits.

The company won GBP938 million of contracts issued by the
Government this year, equivalent to 11% of the total, Telegraph
relays, citing data firm Tussell.

Interserve said earlier this month that it had secured additional
short-term funding, offering a welcome reprieve for the company
after it warned that it was in danger of breaching its financial
covenants, The Telegraph recounts.

Weeks earlier, the company had said that it expected this year's
profits to be half what they were a year earlier, in part due to a
GBP195 million provision for an energy-from-waste contract, The
Telegraph notes.

Recently appointed chief executive Debbie White has outlined a
transformation plan called "Fit for Growth", which intends to cut
overheads and bring Interserve's margins in line with the rest of
the sector, The Telegraph discloses.

Interserve plc is a support services and construction company.


MALLINCKRODT PLC: S&P Puts 'BB-' CCR on CreditWatch Negative
------------------------------------------------------------
S&P Global Ratings placed its ratings on Mallinckrodt PLC,
including the 'BB-' corporate credit rating, on CreditWatch with
negative implications.

The CreditWatch placement follows Mallinckrodt's announcement that
it will acquire Sucampo Pharmaceuticals Inc. for $1.2 billion. The
acquisition raises debt leverage and we believe that despite the
company's solid cash flow generation, adjusted debt leverage could
remain elevated. In addition, operating performance has weakened
with sales softness in key drug H.P. Acthar Gel and ongoing
declines in the generic business. Furthermore, the company faces
potentially increasing competition with its second-largest
franchise, Inomax. Given this backdrop, S&P believes adjusted debt
leverage could remain above 5x for more than a year, if the
company prioritizes acquisitions or share repurchases above debt
reduction.

S&P said, "We expect to resolve the CreditWatch when the
transaction closes, and may update the CreditWatch when we have
more clarity about the company's expectations for 2018 and further
information on the company's financial policy and its plans to
reduce leverage. We anticipate that if we lower the rating, it
would be limited to one notch."


MIND CANDY: Cut Staff Numbers in 2016 Following Financial Woes
--------------------------------------------------------------
James Titcomb at The Telegraph reports that Mind Candy, the
company behind the Moshi Monsters children's franchise, cut three
quarters of its staff in 2016 as it tried to regain profitability,
amid revenues more than halving.

Mind Candy, the London tech firm founded by Michael Acton Smith,
recorded a GBP6.4 million loss in 2016, down from GBP10.9 million
the year earlier, The Telegraph relays, citing accounts filed at
Companies House.

However, it warned of "material uncertainty" over the business's
future, and revealed that cash reserves had dropped to GBP1
million by the end of the year, The Telegraph notes.  It has
struggled amid the rise of smartphone and tablet apps, and has
spent recent years slashing costs in an attempt to cut losses, The
Telegraph states.

Staff numbers fell from 98 to 22 in 2016 and revenues declined to
GBP3.4 million, from GBP7.2 million a year earlier, The Telegraph
discloses.  It warned that the balance sheet "has been weakened by
significant cash outflows" and said that its future depended on
the company hitting projections for 2017 and 2018, The Telegraph
relays.

Last year, the company extended a loan with tech investor
Triplepoint which matures in early 2019, The Telegraph recounts.



                            *********

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

Copyright 2018.  All rights reserved.  ISSN 1529-2754.

This material is copyrighted and any commercial use, resale or
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Information contained herein is obtained from sources believed to
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