/raid1/www/Hosts/bankrupt/TCREUR_Public/180207.mbx         T R O U B L E D   C O M P A N Y   R E P O R T E R

                           E U R O P E

          Wednesday, February 7, 2018, Vol. 19, No. 027


                            Headlines


B E L A R U S

BELARUSBANK: Fitch Hikes Long-Term FC IDR to 'B', Outlook Stable


F R A N C E

FAURECIA SA: S&P Assigns 'BB+' Long-Term CCR, Outlook Stable


G E O R G I A

SILKNET JSC: Fitch Puts 'B+' IDR on Rating Watch Positive


I R E L A N D

CARLYLE GLOBAL 2014-3: Moody's Assigns B2 Rating to Cl. E-R Notes
CVC CORDATUS X: S&P Rates EUR12-Mil. Class F Notes 'B-(sf)'


I T A L Y

ALITALIA SPA: Revenues Up 1% in 2017 Due to New Routes
SIENA MORTGAGES 07-5: Fitch Affirms 'Bsf' Rating on Cl. C Notes


N E T H E R L A N D S

CAIRN CLO IX: Fitch Assigns 'B-(EXP)sf' Rating to Class F Notes


N O R W A Y

SEADRILL LTD: Postpones Initial Hearing on Restructuring Plan


R U S S I A

BELUGA GROUP: Fitch Affirms B+ Long-Term IDR, Outlook Stable
DME LIMITED: Moody's Assigns Ba1 CFR, Outlook Positive
GLOBALTRANS INVESTMENT: Fitch Affirms BB+ Long-Term FC IDR
POWER MACHINES: Moody's Withdraws B2 Corporate Family Rating


U N I T E D   K I N G D O M

BUSINESS MORTGAGE 5: Moody's Affirms Ca Ratings on 2 Tranches
CARILLION PLC: CEO Keith Cochrane Apologizes for Collapse
CARILLION PLC: Lawmakers Question Former Finance Director
EAST COAST: On Verge of Collapse, Government Takeover Mulled
EUROSAIL-UK 2007-6NC: S&P Hikes Class A3a Notes Rating From BB-

GREAT HALL 2007-01: S&P Hikes Class Ea Notes Rating to BB
LADBROKERS CORAL: S&P Affirms BB CCR After Sale to GVC Holdings
WORLDPAY FINANCE: Moody's Affirms Ba2 Senior Unsec. Notes Rating
OYSTER YACHTS: Goes Into Liquidation, 160 Staff Lose Jobs


                            *********



=============
B E L A R U S
=============


BELARUSBANK: Fitch Hikes Long-Term FC IDR to 'B', Outlook Stable
----------------------------------------------------------------
Fitch Ratings has upgraded six Belarus banks' Long-Term Issuer
Default Ratings (IDR) to 'B' from 'B-'. The Outlooks on the IDRs
are Stable.

The banks are Belarusbank (BBK), Belinvestbank (BIB), Development
Bank of the Republic of Belarus (DBRB), BPS-Sberbank (BPS), Bank
BelVEB OJSC (BelVEB) and Belgazprombank (BGPB).

The rating action follows the upgrade of Belarus's sovereign
Long-term IDRs and Country Ceiling to 'B' from 'B-'.

The banks' Viability Ratings (VR) are not affected. A full list
of rating actions is at the end of this rating action commentary.

KEY RATING DRIVERS
BBK, BIB, DBRB

The upgrade of BBK's, BIB's and DBRB's IDRs and Support Ratings
reflects the improvement in the ability of the Belarusian
authorities to support these banks, in case of need, as reflected
in the upgrade of the sovereign's ratings. Sovereign FX reserves
increased to USD7.3 billion at end-2017 and in Fitch's view are
sufficient to service the sovereign's own near-term external debt
repayments and also help state-own banks service their external
debt, in case of need.

This view in turn is based on (i) the moderate, but not
insignificant external liquidity state-owned banks have
accumulated on their own balance sheets; (ii) the majority of
their FX-liabilities being owed to Russian creditors, which makes
them likely to be refinanced at maturity; and (iii) trade finance
facilities from European banks amortising gradually over the
medium term. These factors mean that even in an adverse scenario
the foreign currency support needed by state-owned banks to
service their external liabilities should be moderate.

BBK's and BIB's domestic liabilities (largely customer deposits)
are highly dollarised and a material deposit run would require
greater state support, which may be not available. However, Fitch
views a run on these deposits as relatively unlikely based on
past depositor behaviour during times of macroeconomic stress.
DBRB does not attract customer deposits and its domestic FX
obligations are long-term and so do not represent any immediate
liquidity risk for the bank.

The propensity of the authorities to support these banks remains
high, in Fitch's view, given (i) full state ownership (by the
State Property Committee of Belarus in the case of BBK and BIB
and the Council of Ministers of Belarus in the case of DBRB),
(ii) their systemic importance (greater at BBK) and policy roles
(more at BBK and DBRB), (iii) the government's subsidiary
liability on DBRB's bonds and the track record of support to
date.

BPS, BelVEB, BGPB
The upgrades of BPS's, BelVEB's and BGPB's IDRs and Support
Ratings reflect the upgrade of the Country Ceiling. The latter
captures the level of transfer and convertibility risks in the
country and limits the extent to which support from the banks'
higher-rated Russian parents can be factored into the ratings.

BPS is 98.4%-owned by Sberbank of Russia (Sberbank; BBB-
/Positive), BelVEB is 97.5%-owned by Vnesheconombank, (VEB; BBB-
/Positive), and BGPB is jointly owned by PJSC Gazprom (BBB-
/Positive) and JSC Gazprombank (BB+/Positive), each with a 49.7%
stake.

RATING SENSITIVITIES

The IDRs of the state-owned banks BBK, BIB and DBRB could be
upgraded, if the Belarus sovereign is upgraded, or downgraded, in
case of a sovereign downgrade. The banks' IDRs could be
downgraded, and hence notched off the sovereign, if timely
support is not provided, when needed, or if the cost of potential
support increases significantly relative to the sovereign's
ability to provide it.

The IDRs of the foreign-owned BPS, BelVEB and BGPB could be
upgraded or downgraded if the Country Ceiling is upgraded or
downgraded.

Fitch does not expect a change in the sovereign ratings or the
Country Ceiling in the near term given the Stable Outlook on
Belarus's ratings.

The rating actions are:

BBK and BIB

Long-Term Foreign-Currency IDRs upgraded to 'B' from 'B-';
Outlook Stable
Short-Term Foreign-Currency IDRs affirmed at 'B'
Support Ratings upgraded to '4' from '5'
Support Rating Floors revised to 'B' from 'B-'
Viability Ratings: 'b-', unaffected

DBRB

Long-Term Foreign and Local-Currency IDRs upgraded to 'B' from
'B-'; Outlook Stable
Short-Term Foreign-Currency IDR affirmed at 'B'
Support Rating upgraded to '4' from '5'
Support Rating Floor revised to 'B' from 'B-'

BPS, BGPB and BelVEB

Long-Term Foreign Currency IDRs upgraded to 'B' from 'B-';
Outlook Stable
Short-Term Foreign-Currency IDRs affirmed at 'B'
Support Ratings upgraded to '4' from '5'
Viability Ratings: 'b-', unaffected


===========
F R A N C E
===========


FAURECIA SA: S&P Assigns 'BB+' Long-Term CCR, Outlook Stable
------------------------------------------------------------
S&P Global Ratings assigned its 'BB+' long-term corporate credit
rating to France-based auto supplier Faurecia S.A. The outlook is
stable.

S&P said, "We also assigned our 'BB+' issue rating to Faurecia's
EUR500 million 3.125% senior unsecured notes due 2022, its EUR700
million 3.625% senior unsecured notes due 2023, and its EUR1.2
billion revolving credit facility (RCF) maturing in June 2021.
The '3' recovery rating on this debt reflects our expectation of
meaningful recovery prospects of 60% in the event of a
hypothetical default."

S&P related, "Our rating on Faurecia reflects our expectation
that the company will sustain its credit metrics at current
levels while investing to reposition its portfolio toward higher
value-added products and rebalance its geographic mix with
increased presence in Asia. These strategic goals should fuel a
wider EBITDA margin and stronger free cash flow generation,
assuming a continued focus on cost control and accretive
acquisitions, barring major changes in the current benign
economic environment.

"With about EUR15.6 billion of value-added sales reported in 2016
(excluding catalytic converter monolith sales), Faurecia is a
large tier 1 automotive supplier providing major carmakers such
as Volkswagen, Ford, Renault-Nissan, Peugeot, BMW, and Daimler
with seating systems, interior components, and emissions control
systems. Faurecia's top-three customers account for 45% to 50% of
total sales, but the company runs about 870 active programs, none
of which exceeded 3% of sales."

In 2016, Faurecia derived about EUR6.6 billion of sales from its
seating division, competing with market leaders Adient plc and
Lear Corp. Faurecia manufactures and assembles frames and
mechanisms for auto seating but also provides complete seating
solutions to auto original equipment manufacturers (OEMs). The
interiors segment is Faurecia's second-largest segment by
revenues, generating EUR4.8 billion in 2016. Faurecia holds
leading market positions, along with Yanfeng Global Automotive
Interior Systems Co. Ltd and ahead of Grupo Antolin Irausa SA.
Clean mobility is Faurecia's third division, with EUR4.2 billion
of value-added revenues. Along with Tenneco Inc., Faurecia
holds leading market positions in emissions control systems.

The demand for Faurecia's products ultimately relies on numbers
of new car sales. The auto market is highly cyclical because
consumers' disposable income or their ability to access
affordable financing solutions fluctuate with economic cycles.
Over the next 12-18 months, S&P forecasts continued growth of
global car production levels, albeit at a slower pace than in the
past two years, especially in the U.S. and Europe.

S&P said, "We regard Faurecia's EBITDA margin (which we expect to
be about 8% in 2017) (as adjusted by S&P Global Ratings, after
capitalized research and development [R&D] costs and
restructuring costs) to be below average in the sector, which
reflects the competitive nature of the auto industry, with
carmakers imposing recurring price-downs during the life of
programs. It also incorporates the somewhat commoditized nature
of Faurecia's products. Lastly, we believe that the EBITDA margin
is hampered by the need for further cost optimization, which the
company has already started to implement. We forecast that the
EBITDA margin will move toward 9% in 2018, supported by revenue
growth combined with rationalization of costs (R&D, manufacturing
costs, and selling, general, and administrative costs)."

Faurecia's concept "cockpit of the future" requires the company
to develop new capabilities, such as connectivity, artificial
intelligence, and adaptive security. In 2017, Faurecia acquired
stakes in Parrot and Jiangxi Coagent, specializing in
connectivity and infotainment. S&P assumes that Faurecia will
favor bolt-on acquisitions or joint ventures to optimize time and
investments in developing such capabilities. S&P has therefore
included in its base case annual spending of EUR300 million-
EUR350 million for acquisitions.

The ongoing trend of electrification, accompanied by a decline in
new diesel cars sales, should be neutral to Faurecia because
seating systems and interiors components are indifferent to the
powertrain mix. Moreover, the increased scrutiny on emission
controls by regulatory bodies (in China, Europe, or the U.S.)
should support growth of Faurecia's emissions control systems
(retrofit and new cars).

Historically, Faurecia's free cash flow generation has been
volatile and weak, but it started to pick up in the last couple
of years. The better free cash flow generation resulted from
higher EBITDA and from improved cash conversion through greater
discipline regarding working capital changes and capital
expenditures (capex).

Overall, S&P expects credit metrics will remain broadly stable in
the short term and strengthen to higher levels in the medium
term, assuming acquisitions become accretive, capex is maintained
at current levels, and dividends remain unchanged, with a payout
ratio of about 25%.

The stable outlook reflects S&P's expectation that, over the next
12-18 months, Faurecia will further increase its sales in Asia
and more than offset flat growth expectations in Europe and North
America. Volume growth, together with the rationalization of its
industrial footprint, should lead to a gradual improvement in the
company's adjusted EBITDA margin toward 9% and a ratio of FOCF to
debt increasing to more than 15%. S&P also expects FFO to
adjusted debt in the 35%-40% range.

S&P said, "We could upgrade Faurecia if it increased its FFO-to-
debt ratio sustainably above 40% and its FOCF-to-debt ratio
sustainably above 20%. This could result from the company's
successful implementation of its strategy to grow the share
of technological content of its product offering while moderating
R&D costs and capex. An upgrade would also hinge on management's
commitment to maintaining credit metrics at these levels.

"We could lower our rating on Faurecia if it fails to improve its
EBITDA margin due to operational setbacks or weaker-than-expected
new car sales leading to an FFO-to-debt ratio below 30% and an
FOCF-to-debt ratio below 15% for a prolonged period. A more
aggressive financial policy, characterized by large debt financed
acquisitions or shareholder returns, could also lead to a
negative rating action."

France-based tier 1 auto supplier Faurecia S.A. designs,
manufactures, and assembles auto components, including seating
systems, cockpits, door panels, and emissions control systems.


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G E O R G I A
=============


SILKNET JSC: Fitch Puts 'B+' IDR on Rating Watch Positive
---------------------------------------------------------
Fitch Ratings has placed Georgian-based telecoms company JSC
Silknet's Long-Term Issuer Default Rating (IDR) of 'B+' on Rating
Watch Positive following the company's announced acquisition of
Geocell, Georgia's second-largest mobile operator.

The ratings are likely to be affirmed at the current level of
'B+', with the assignment of a Positive or Stable Outlook,
depending on the terms of the transaction's financing package.
The Watch may be resolved once the transaction receives
regulatory clearance, which Fitch do not expect before March
2018, and there is more clarity on the financial structure post-
deal.

Silknet is the incumbent fixed-line telecoms operator in Georgia
with an extensive backbone and last-mile infrastructure across
the country. The company holds sustainably strong market
positions of above 40% in both fixed-voice and broadband
services, and is the largest provider of pay-TV services by
revenue. Silknet's small absolute size is a strategic weakness;
it services fewer than 350,000 fixed lines and generated GEL63
million (about USD27 million) EBITDA in 2016.

Silknet has reached an agreement to acquire Geocell from Telia
Company AB (A-/Stable) and Turkcell (BBB-/Negative). Silknet
announced its intention to finance the acquisition, which values
Geocell at USD153 million, through a combination of debt and
equity. Silknet is planning to start offering convergent
broadband, pay TV, mobile and fixed telephony services.

KEY RATING DRIVERS

Improving Operating Profile: The acquisition of the second-
largest mobile operator in Georgia has a strong strategic
rationale. Silknet would obtain flexibility to start offering
bundled fixed and mobile services, addressing its current
weakness versus its key domestic rival Magticom, which is fully
four-play-enabled. Geocell has been able to sustainably maintain
its market shares, and is likely to improve its competitive
positions after significant network investments already
consummated in 2015-2016 and expected in 2017-2018.

Substantial Merger Synergies: Fitch believe the acquisition will
allow Silknet to achieve significant operating and revenue
synergies. The networks of the two merging operators are likely
to be, to a large degree, complimentary. The extensive broadband
network of Silknet would allow it to more efficiently carry
rapidly growing data traffic generated in Geocell's newly-built
4G network.

Execution Risks in Bundling Strategy: Silknet's strategy of
promoting bundling services after the acquisition entails
significant execution risks, in Fitch view. Aggressive marketing
moves, including through offering significant discounts on
bundled services, are likely to trigger competitive moves.
Nevertheless, Silknet would be better-positioned versus smaller
competitors without bundled services.

Lower churn, typically associated with bundled offers, may allow
Silknet to achieve substantial subscriber acquisition and
retention savings. However, an active bundling strategy may also
lead to an aggressive price competition with other fixed-mobile
converged market participants.

Higher FX Risk Possible: The transaction's financing may
significantly increase the share of FX debt in Silknet's total,
which would be a risk. Fitch typically reflects higher FX risk in
tighter downgrade leverage triggers.

Leverage Increase Moderate: Fitch do not expect funds from
operations (FFO) adjusted net leverage to exceed 3x assuming
tangible equity contribution. This means net leverage may become
consistent with a higher rating level within the 18 to 24 months.

DERIVATION SUMMARY

Silknet benefits from its established customer franchise and the
wide network of a telecoms incumbent, similar to its higher-rated
emerging markets peers such as Kazakhtelecom JSC (BB+/Stable) and
PJSC Tattelecom (BB/Stable). However, Silknet is smaller in size
with revenue of less than EUR100 million. Its corporate
governance is shaped by dominant shareholder influence.

KEY ASSUMPTIONS

Fitch's key assumptions within the rating case for Silknet
include:
- Continuing voice revenue reduction, at 10% per annum on
   average;
- Broadband revenue growth in mid-single digits;
- Double-digit growth in pay-TV revenue in 2017 and 2018;
- GEL3 million of indefeasible rights of use proceeds are
   treated as recurring and included into FFO, with the rest
   treated as one-offs;
- Tangible equity injection for Geocell acquisition

RATING SENSITIVITIES

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

- Improved market positions, stronger FCF generation post
   Geocell acquisition, alongside comfortable liquidity and a
   track record of improved corporate governance, and
- FFO adjusted net leverage sustainably below 2.5x in the
   presence of significant FX risks.

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

- FFO-adjusted net leverage rising above 3x on a sustained basis
   without a clear path for deleveraging in the presence of
   significant FX risks, and
- A rise in corporate governance risks due to, among other
   things, related-party transactions or up-streaming excessive
   distributions to shareholders.

LIQUIDITY

Silknet's liquidity may be stretched by the Geocell acquisition.
The company heavily relies on TBC Bank (BB-/Stable), its largest
creditor and key relationship bank, for refinancing.



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I R E L A N D
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CARLYLE GLOBAL 2014-3: Moody's Assigns B2 Rating to Cl. E-R Notes
-----------------------------------------------------------------
Moody's Investors Service has assigned definitive ratings to nine
classes of notes issued by Carlyle Global Market Strategies Euro
CLO 2014-3 Designated Activity Company:

-- EUR3,000,000 Class X Senior Secured Floating Rate Notes due
    2032, Definitive Rating Assigned Aaa (sf)

-- EUR265,750,000 Class A-1A-R Senior Secured Floating Rate
    Notes due 2032, Definitive Rating Assigned Aaa (sf)

-- EUR5,250,000 Class A-1B-R Senior Secured Fixed Rate Notes due
    2032, Definitive Rating Assigned Aaa (sf)

-- EUR22,000,000 Class A-2A-R Senior Secured Floating Rate Notes
    due 2032, Definitive Rating Assigned Aa2 (sf)

-- EUR20,000,000 Class A-2B-R Senior Secured Fixed Rate Notes
    due 2032, Definitive Rating Assigned Aa2 (sf)

-- EUR26,000,000 Class B-R Senior Secured Deferrable Floating
    Rate Notes due 2032, Definitive Rating Assigned A2 (sf)

-- EUR22,500,000 Class C-R Senior Secured Deferrable Floating
    Rate Notes due 2032, Definitive Rating Assigned Baa2 (sf)

-- EUR32,500,000 Class D-R Senior Secured Deferrable Floating
    Rate Notes due 2032, Definitive Rating Assigned Ba2 (sf)

-- EUR13,000,000 Class E-R Senior Secured Deferrable Floating
    Rate Notes due 2032, Definitive Rating Assigned B2 (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 January 2032. 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, CELF Advisors LLP ("CELF Advisors") has
sufficient experience and operational capacity and is capable of
managing this CLO.

The Issuer will issue the Class X Notes, the Class A-1A-R Notes,
the Class A-1B-R Notes, the Class A-2A-R Notes, the Class A-2B-R
Notes, the Class B-R Notes, the Class C-R Notes, the Class D-R
Notes and the Class E-R Notes (the "Refinancing Notes") in
connection with the refinancing of the Class A-1A Senior Secured
Floating Rate Notes due 2027, the Class A-1B Senior Secured Fixed
Rate Notes due 2027, the Class A-2A Senior Secured Floating Rate
Notes due 2027, the Class A-2B Senior Secured Fixed Rate Notes
due 2027, the Class B Senior Secured Deferrable Floating Rate
Notes due 2027, the Class C Senior Secured Deferrable Floating
Rate Notes due 2027, the Class D Senior Secured Deferrable
Floating Rate Notes due 2027 and the Class E Senior Secured
Deferrable Floating Rate Notes due 2027 ("the Refinanced Notes"),
previously issued on October 29, 2014 (the "Original Issue
Date"). The Issuer will use the proceeds from the issuance of the
Refinancing Notes to redeem in full the Original Notes that will
be refinanced. On the Original Issue Date, the Issuer also issued
EUR44,250,000 of unrated Subordinated Notes, which will remain
outstanding.

CGMSE 14-3 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 nine month
ramp-up period in compliance with the portfolio guidelines.

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 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.

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.

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.

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: EUR437,500,000

Defaulted par: EUR0

Diversity Score:44

Weighted Average Rating Factor (WARF): 2950

Weighted Average Spread (WAS): 3.45%

Weighted Average Fixed Coupon (WAC): 3.75%

Weighted Average Recovery Rate (WARR): 44.00%

Weighted Average Life (WAL): 9.26 years

Moody's adjusted the Weighted Average Life of its base case when
compared to the transaction's covenant of 8.75 years. This
adjustment accounts for the flexibility given to the Collateral
Manager to exclude certain assets from the Weighted Average Life
Test calculation if the Aggregate Principal Balance of the
portfolio (for the determination of which all assets are carried
at their par amount) is greater than Reinvestment Target Par
Balance.

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%. Furthermore, the
eligibility criteria require that obligors be domiciled in a
"Non-Emerging Market Country", with the latter being defined as a
country, the Moody's local currency risk ceiling of which is at
least "A3". As a result, in accordance with the methodology,
Moody's did not adjust the target par amount depending on the
target rating of each class of 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 2950 to 3393)

Rating Impact in Rating Notches:

Class X Senior Secured Floating Rate Notes: 0

Class A-1A-R Senior Secured Floating Rate Notes: -1

Class A-1B-R Senior Secured Fixed Rate Notes: -1

Class A-2A-R Senior Secured Floating Rate Notes: -2

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

Class B-R Senior Secured Deferrable Floating Rate Notes: -2

Class C-R Senior Secured Deferrable Floating Rate Notes: -2

Class D-R Senior Secured Deferrable Floating Rate Notes: -1

Class E-R Senior Secured Deferrable Floating Rate Notes: 0

Percentage Change in WARF -- increase of 30% (from 2950 to 3835)

Class X Senior Secured Floating Rate Notes: 0

Class A-1A-R Senior Secured Floating Rate Notes: -2

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

Class A-2A-R Senior Secured Floating Rate Notes: -4

Class A-2B-R Senior Secured Fixed Rate Notes: -4

Class B-R Senior Secured Deferrable Floating Rate Notes: -4

Class C-R Senior Secured Deferrable Floating Rate Notes: -2

Class D-R Senior Secured Deferrable Floating Rate Notes: -2

Class E-R Senior Secured Deferrable Floating Rate Notes: -3


CVC CORDATUS X: S&P Rates EUR12-Mil. Class F Notes 'B-(sf)'
-----------------------------------------------------------
S&P Global Ratings assigned its credit ratings to CVC Cordatus
Loan Fund X DAC's class A-1, A-2, B-1, B-2, C, D, E, and F notes.
At closing, the issuer also issued unrated subordinated notes.

CVC Cordatus Loan Fund X is a European cash flow collateralized
loan obligation (CLO), securitizing a portfolio of primarily
senior secured leveraged loans and bonds. The transaction is
managed by CVC Credit Partners European CLO Management LLP.

The ratings assigned to the notes reflect S&P's assessment of:

- The diversified collateral pool, which consists primarily of
broadly syndicated speculative-grade senior secured term loans
and bonds that are governed by collateral quality and portfolio
profile tests.

- The credit enhancement provided through the subordination of
cash flows, excess spread, and overcollateralization.

- The collateral manager's experienced team, which can affect
the
performance of the rated notes through collateral selection,
ongoing portfolio management, and trading.

- The transaction's legal structure, which is bankruptcy remote.

Under the transaction documents, the rated notes pay quarterly
interest unless there is a frequency switch event. Following
this, the notes permanently switch to semiannual payment. The
portfolio's reinvestment period ends approximately four years
after closing.

S&P said, "Our ratings reflect our assessment of the collateral
portfolio's credit quality, which has a weighted-average 'B'
rating. We consider that the portfolio is well-diversified,
primarily comprising broadly syndicated speculative-grade senior
secured term loans and senior secured bonds. Therefore, we have
conducted our credit and cash flow analysis by applying our
criteria for corporate cash flow collateralized debt obligations.

"In our cash flow analysis, we used the EUR400 million target par
amount, the covenanted weighted-average spread (3.60%), the
reference weighted-average coupon (4.25%), and the target minimum
weighted-average recovery rate at the 'AAA' rating level as
indicated by the collateral manager. We applied various cash flow
stress scenarios, using four different default patterns, in
conjunction with different interest rate stress scenarios for
each liability rating category."

Bank of New York Mellon, London Branch is the bank account
provider and custodian. The documented downgrade remedies are
line with our current counterparty criteria.

Under its structured finance ratings above the sovereign
criteria, S&P considers that the transaction's exposure to
country risk is sufficiently mitigated at the assigned rating
levels.

The issuer is bankruptcy remote, in accordance with S&P's legal
criteria.

Following its analysis of the credit, cash flow, counterparty,
operational, and legal risks, S&P believes its ratings are
commensurate with the available credit enhancement for each class
of notes.

RATINGS LIST

Ratings Assigned

CVC Cordatus Loan Fund X DAC
EUR415.10 Million Senior Secured Fixed- And Floating-Rate Notes
(Including EUR43.90 Million Unrated Subordinated Notes)

Class          Rating            Amount
                               (mil. EUR)

A-1            AAA (sf)          206.00
A-2            AAA (sf)           30.00
B-1            AA (sf)            45.60
B-2            AA (sf)            10.00
C              A (sf)             22.80
D              BBB (sf)           21.60
E              BB (sf)            23.20
F              B- (sf)            12.00
Sub.           NR                 43.90

NR--Not rated.
Sub.--Subordinated.


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


ALITALIA SPA: Revenues Up 1% in 2017 Due to New Routes
------------------------------------------------------
Alberto Sisto at Reuters reports that Alitalia Chief Commercial
Officer Fabio Maria Lazzerini said on Feb. 5 revenues rose by 1%
in 2017, following six years of falling sales and the insolvent
Italian airline aims to do better this year.

Alitalia, which has made a profit only a few times in its 70-year
history, was put under special administration last year after
staff rejected a plan to cut jobs and salaries, Reuters recounts.

According to Reuters, the Italian government is now looking for a
buyer for the national carrier, hoping to strike a deal before
national elections due March 4.

For 2018, Alitalia expects a "considerable" increase in sales and
passengers, Mr. Lazzerini said during a conference in Rome,
Reuters relays, citing comments confirmed by a spokesman.

Alitalia's December sales grew by around 3%, Reuters discloses.
It expects sales to rise between 4-5% in the first quarter,
helped by new routes and plans to fill more seats, with the load
factor seen growing between 6% and 7%, Reuters states.

                       About Alitalia

Alitalia - Societa Aerea Italiana S.p.A., is the flag carrier of
Italy.  Alitalia operates 123 aircraft with approximately 4,200
flights weekly to 94 destinations, including 26 destinations in
Italy and 68 destinations outside of Italy.  It has a strong
global presence, flying within Europe as well as to cities across
North America, South America, Africa, Asia and the Middle East.
During 2016, the Debtor provided passenger service to
approximately 22.6 million passengers.  Its air freight business
also is substantial, having carried over 74,000 tons in 2016.
Alitalia is a member of the SkyTeam alliance, participating with
other member airlines in issuing tickets, code-share flights,
mileage programs and other similar services.

Alitalia previously navigated its way through a successful
restructuring.  After filing for bankruptcy protection in 2008,
Alitalia found additional investors, acquired rival airline Air
One, and re-emerged as Italy's leading airline in early 2009.

Alitalia was the subject of a bail-out in 2014 by means of a
significant capital injection from Etihad Airways, with goals of
achieving profitability during 2017.

After labor unions representing Alitalia workers rejected a plan
that called for job reductions and pay cuts in April 2017, and
the refusal of Etihad Airways to invest additional capital,
Alitalia filed for extraordinary administration proceedings on
May 2, 2017.

                         Chapter 15

On June 12, 2017, Alitalia filed a Chapter 15 bankruptcy petition
in Manhattan, New York, in the U.S. (Bankr. S.D.N.Y. Case No.
17-11618) to seek recognition of the Italian insolvency
proceedings and protect its assets from legal action or creditor
collection efforts in the U.S.  The Hon. Sean H. Lane is the case
judge in the U.S. case.  Dr. Luigi Gubitosi, Prof. Enrico Laghi,
and Prof. Stefano Paleari are the foreign representatives
authorized to sign the Chapter 15 petition.  Madlyn Gleich
Primoff, Esq., Freshfields Bruckhaus Deringer US LLP, is the U.S.
counsel to the Foreign Representatives.


SIENA MORTGAGES 07-5: Fitch Affirms 'Bsf' Rating on Cl. C Notes
---------------------------------------------------------------
Fitch Ratings has taken rating actions on four Siena Mortgages
RMBS:

Siena Mortgages 07-5 Srl, Series 2007 (SM07-5)
Class A (ISIN IT0004304223) affirmed at 'AAsf'; off Rating Watch
Evolving (RWE); Outlook Stable
Class B (ISIN IT0004304231) upgraded to 'AAsf' from 'Asf'; off
RWE; Outlook Stable
Class C (ISIN IT0004304249) affirmed at 'Bsf'; off RWE; Outlook
Stable

Siena Mortgages 07-5 Srl, Series 2008 (SM07-5 Series 2)
Class A (ISIN IT0004353808) upgraded to 'AAsf' from 'AA-sf'; off
RWE; Outlook Stable
Class B (ISIN IT0004353816) upgraded to 'Asf' from 'BBBsf'; off
RWE; Outlook Positive
Class C (ISIN IT0004353824) affirmed at 'Bsf'; off RWE; Outlook
Stable

Siena Mortgages 09-6 Srl (SM09-6)
Class A (ISIN IT0004488794) affirmed at 'AAsf'; off RWE; Outlook
Stable
Class B (ISIN IT0004488810) affirmed at 'AAsf'; off RWE; Outlook
Stable
Class C (ISIN IT0004488828) affirmed at 'A-sf'; off RWE; Outlook
Stable

Siena Mortgages 10-7 S.r.l. (SM10-7)
Class A3 (ISIN IT0004658289) affirmed at 'AAsf'; off RWE; Outlook
Stable

The removal of the Rating Watch followed the implementation of
Fitch's new European RMBS Rating Criteria published on 27 October
2017. The transactions were placed on RWE on 5 October 2017 on
the publication of Fitch's Exposure Draft: European RMBS Rating
Criteria.

The four prime Italian RMBS transactions were originated by Banca
Monte dei Paschi di Siena (BMPS, B/Stable) and its subsidiaries.

KEY RATING DRIVERS
Recent Performance within Expectations
Each Siena transaction shows lower 90+ arrears than the Italian
index, with SM09-6 being the highest by arrears and the most
volatile.

Apart from SM09-6, which has posted gross cumulative defaults
above 5% of the original portfolio balance, for the other
transactions in the series the gross cumulative default ratio,
which stands between 2% (SM07-5) and 2.5% (SM07-5 Series 2), is
below the Italian market index of 4.5%. Interest deferral
triggers and cash reserve amortisation conditions are now
correctly monitored by the servicer against the above cumulative
gross default ratios rather than against the percentage of net
outstanding defaults.

The average new default rate, ranging between 0.6% (SM07-5 and
SM10-7) and 0.8% (SM07-5 Series 2), is below the Italian dynamic
default rate of 1% for all deals except SM09-6 (1.2%).

Strong Credit Enhancement for Senior Notes
Credit enhancement (CE) of the class A notes of each transaction
has continued to build up, due to repayment of the underlying
portfolios and the sequential pay-down of the notes. CE for the
senior notes of SM07-5 and SM07-5 Series 2 is above 30% and for
SM09-6 and SM10-7, close to 45% and 50%, respectively. This
supports the upgrade of SM07-5 Series 2 class A notes to 'AAsf'
and the affirmation of the other class A notes at 'AAsf'.

Increased Protection for Mezzanine Notes
CE of the class B notes of SM07-5 and SM07-5 Series 2 has
increased to about 20% from 18% one year ago, so they can
withstand higher rating stresses. This underpins upgrade and also
the Positive Outlook on the class B notes of Series 2. In Fitch's
view, the class B notes of SM07-5 are more protected than SM07-5
Series 2 against interest rate mismatches between the assets and
the liabilities due to a lower cap on their coupon (3.7% vs.
4.7%), which explains the different ratings for the tranches
despite broadly carrying the same CE.

CE has also increased to 20% for the class B notes of SM09-6,
supporting its affirmation at 'AAsf'.

The only source of CE for the class C notes of SM09-6 is the cash
reserve, currently held at Deutsche Bank AG, London branch
(BBB+/Stable/F2), which has a 'A-' deposit rating).

Ineligible Swap Counterparty
As per Fitch's counterparty risk criteria, BMPS is no longer
eligible to perform the role of swap counterparty in SM07-5,
SM07-5 Series 2 and SM09-6. Fitch has tested the dependency of
the class C notes of SM07-5 and SM07-5 Series 2 on the cash flows
from the swap and found that their CE can now support the ratings
without giving any credit to the swap. The agency has therefore
delinked these tranches from the Issuer Default Rating (IDR) of
BMPS as swap counterparty. The class C notes of SM09-6 were
already delinked and rated above BMPS's IDR of 'B'.

Potential Fixed-rate Nature of the Pools
In a rising interest rate scenario, Fitch modelled capped
floating-rate loans (accounting for between 16% of the current
pool in SM07-5 and 84% in SM10-7) at their weighted average cap
rate for their remaining life. At the same time, modular loans
(between 4% in SM09-6 and 58% in SM07-5) have been assumed to
switch to a fixed rate at the next available contractual switch
date.

In a rising Euribor scenario the structures generate large excess
spread because the cost of the capped notes is significantly
lower than the interest revenue generated by the underlying
mortgages. As a result, the agency applied a cap also to the
yield of the mortgage assets to reduce the benefit associated
with the cap on the notes' coupon.

Other Counterparty Risk Mitigated
Payment interruption risk on the rated notes is adequately
addressed across deals due to the presence of cash reserves. Even
though most of them are currently below target as they can also
be used to provision for defaulted loans, Fitch deems the gap
(between 1% and 8%) small and expects the size of the reserves to
remain adequate to cover at least one quarter of interest
payments on the rated notes and senior expenses.

All the transactions also benefit from commingling reserves, the
size of which is adequate to broadly cover at least the loss of
one month's collections. Fitch has also tested a deposit set-off
loss in the rating scenarios above the rating of BMPS as deposit-
taking institution. Fitch deems counterparty risk as mitigated in
the rating scenarios of the notes.

Sovereign Cap
Italian securitisations can achieve a maximum rating of 'AAsf',
six notches above Italy's Long-Term IDR (BBB/Stable).

European RMBS Rating Criteria Implemented
Fitch has observed that between 68% and 98% of each pool falls
under the two lowest debt-to-income (DTI) buckets (ie, DTI lower
than 30%), thus getting lower default probability, all other
borrower and loan features being equal. Furthermore, between 33%
and 88% of each pool is floating-rate with cap or pays fixed-
rate, which receives a lower default rate.

RATING SENSITIVITIES

Changes to Italy's Long-Term 'BBB' IDR and the rating cap for
Italian structured finance transactions, currently 'AAsf', could
trigger rating changes on the classes rated at this level.

If the performance of the underlying pool of SM07-5 Series 2
continues to be stable and the CE of the class B notes continues
to build up, this tranche may be upgraded, as reflected in its
Positive Outlook.

Fitch acknowledges that following the downgrade of Deutsche Bank
AG's Long- and Short-Term IDRs in September 2017, according to
the transaction documentation the bank is no longer eligible to
perform the role of account bank for SM09-6 and SM10-7. The
agency believes that Deutsche Bank AG is looking to implement
remedial actions, but the timing of these actions remains
uncertain. The agency will continue to monitor the progress and
may take rating actions accordingly.


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


CAIRN CLO IX: Fitch Assigns 'B-(EXP)sf' Rating to Class F Notes
---------------------------------------------------------------
Fitch Ratings has assigned Cairn CLO IX B.V. expected ratings:

Class A: 'AAA(EXP)sf'; Outlook Stable
Class B-1: 'AA(EXP)sf'; Outlook Stable
Class B-2: 'AA(EXP)sf'; Outlook Stable
Class C: 'A(EXP)sf'; Outlook Stable
Class D: 'BBB-(EXP)sf'; Outlook Stable
Class E: 'BB(EXP)sf'; Outlook Stable
Class F: 'B-(EXP)sf'; Outlook Stable
M-1 notes: not rated
M-2 notes: not rated

The assignment of the final ratings is contingent on the receipt
of final documents conforming to information already reviewed.

Cairn CLO IX B.V. is a securitisation of mainly senior secured
loans (at least 90%) with a component of senior unsecured,
mezzanine, and second-lien loans. A total note issuance of
EUR411million will be used to fund a portfolio with a target par
of EUR400 million. The portfolio will be actively managed by
Cairn Loan Investments LLP.

KEY RATING DRIVERS
'B' Portfolio Credit Quality
Fitch views the average credit quality of obligors to be in the
'B' range. The Fitch-weighted average rating factor (WARF) of the
identified portfolio is 31.71, below the indicative maximum
covenant of 34 for assigning the expected ratings.

High Recovery Expectations
At least 90% of the portfolio will comprise senior secured
obligations. Fitch views the recovery prospects for these assets
as more favourable than for second-lien, unsecured and mezzanine
assets. The Fitch-weighted average recovery rate of the
identified portfolio is 66.25%, above the minimum covenant of
62.9% for assigning the expected ratings.

Limited Interest Rate Exposure
Up to 5% of the portfolio can be invested in fixed-rate assets,
while there are 2.67% fixed-rate liabilities. Fitch modelled both
0% and 5% fixed-rate buckets and found that the rated notes can
withstand the interest rate mismatch associated with each
scenario.

Diversified Asset Portfolio
The covenanted maximum exposure to the top 10 obligors for
assigning the expected ratings is 21% of the portfolio balance.
This covenant ensures that the asset portfolio will not be
exposed to excessive obligor concentration.

VARIATIONS FROM CRITERIA

The "Fitch Ratings Definitions" was amended so that assets that
are not rated by Fitch but rated privately by the other agency
rating the liabilities, can be assumed to be of 'B-' credit
quality for up to 10% of the aggregated portfolio notional. This
is a variation from Fitch's criteria, which requires all assets
unrated by Fitch and without public ratings to be treated as
'CCC'. The change was motivated by Fitch's policy change of no
longer providing credit opinions for EMEA companies over a
certain size. Instead Fitch expects to provide private ratings
that would remove the need for the manager to treat assets under
this leg of the "Fitch Rating Definition".

The amendment has only a small impact on the ratings. Fitch has
modelled the transaction at the pricing point with 10% of the 'B-
' assets with a 'CCC' rating instead, which resulted in a two-
notch downgrade at the 'A' rating level and a one-notch downgrade
or no impact at all at other rating levels.

RATING SENSITIVITIES

A 125% default multiplier applied to the portfolio's mean default
rate, and with this increase added to all rating default levels,
would lead to a downgrade of up to two notches for the rated
notes. A 25% reduction in recovery rates would lead to a
downgrade of up to four notches at the 'BB' rating level and two
notches for all other rating levels.


===========
N O R W A Y
===========


SEADRILL LTD: Postpones Initial Hearing on Restructuring Plan
-------------------------------------------------------------
Nerijus Adomaitis and Clara Denina at Reuters report that
drilling rig company Seadrill said in a court filing it postponed
an initial hearing on its restructuring plan to Feb. 26, buying
more time to consider alternative plans.

Seadrill, one of the world's largest offshore drilling rig
operators, filed for bankruptcy in September after a steep drop
in crude prices caused drastic cutbacks in oil company
investment, Reuters recounts.

The company, controlled by Norwegian-born billionaire
John Fredriksen, had been working with creditors on a
restructuring plan to bring in more than US$1 billion in fresh
funding, allow it to maintain its fleet of drilling units and pay
creditors and staff, Reuters relates.

It is the third time the company has postponed a hearing on its
disclosure statement, which describes the restructuring plan and
must be approved by the court before creditors can vote on the
plan of reorganization, Reuters notes.

According to Reuters, the Feb. 6 bankruptcy court filing also
said the deadline for objecting to Seadrill's plan had been
extended to Feb. 19 for the official committee of unsecured
creditors, an ad hoc group of bondholders and Barclays Capital.

The ad hoc group of bondholders and Barclays Capital have
proposed alternative restructuring plans and posted a cash
deposit that opened the way for talks, Reuters discloses.

                      About Seadrill Ltd

Seadrill Limited is a deepwater drilling contractor providing
drilling services to the oil and gas industry.  It is
incorporated in Bermuda and managed from London.  Seadrill and
its affiliates own or lease 51 drilling rigs, which represents
more than 6% of the world fleet.

As of Sept. 12, 2017, Seadrill employed 3,760 highly-skilled
individuals across 22 countries and five continents to operate
their drilling rigs and perform various other corporate
functions.

As of June 30, 2017, Seadrill had $20.71 billion in total assets,
$10.77 billion in total liabilities and $9.94 billion in total
equity.

Seadrill reported a net loss of US$155 million on US$3.17 billion
of total operating revenues for the year ended Dec. 31, 2016,
following a net loss of US$635 million on US$4.33 billion of
total operating revenues for the year ended in 2015.

After reaching terms of a reorganization plan that would
restructure $8 billion of funded debt, Seadrill Limited and 85
affiliated debtors each filed a voluntary petition for relief
under Chapter 11 of the United States Bankruptcy Code (Bankr.
S.D. Tex. Lead Case No. 17-60079) on Sept. 12, 2017.

Together with the chapter 11 proceedings, Seadrill, North
Atlantic Drilling Limited ("NADL") and Sevan Drilling Limited
("Sevan") commenced liquidation proceedings in Bermuda to appoint
joint provisional liquidators and facilitate recognition and
implementation of the transactions contemplated by the RSA and
Investment Agreement, and Simon Edel, Alan Bloom and Roy Bailey
of Ernst & Young are to act as the joint and several provisional
liquidators.

In the Chapter 11 cases, the Company has engaged Kirkland & Ellis
LLP as legal counsel, Houlihan Lokey, Inc. as financial advisor,
and Alvarez & Marsal as restructuring advisor.  Slaughter and May
has been engaged as corporate counsel, and Morgan Stanley served
as co-financial advisor during the negotiation of the
restructuring agreement.  Advokatfirmaet Thommessen AS is serving
as Norwegian counsel.  Conyers Dill & Pearman is serving as
Bermuda counsel.  Prime Clerk serves as claims agent.

The United States Trustee for Region 7 formed an official
committee of unsecured creditors with seven members: (i)
Computershare Trust Company, N.A.; (ii) Daewoo Shipbuilding &
Marine Engineering Co., Ltd.; (iii) Deutsche Bank Trust Company
Americas; (iv) Louisiana Machinery Co., LLC; (v) Nordic Trustee
AS; (vi) Pentagon Freight Services, Inc.; and (vii) Samsung Heavy
Industries Co., Ltd.

Kramer Levin Naftalis & Frankel LLP is serving as lead counsel to
the Committee.  Cole Schotz P.C. is local and conflicts counsel
to the Committee.  Zuill & Co (in exclusive association with
Harney Westwood & Riegels) is serving as Bermuda counsel.
London-based Quinn Emanuel Urquhart & Sullivan, UK LLP, is
serving as English counsel.  Parella Weinberg Partners LLP is the
investment banker to the Committee.  FTI Consulting Inc. is the
financial advisor.


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


BELUGA GROUP: Fitch Affirms B+ Long-Term IDR, Outlook Stable
------------------------------------------------------------
Fitch Ratings has affirmed PJSC BELUGA GROUP's (Beluga) Foreign-
Currency and Local-Currency Long-Term Issuer Default Ratings
(IDRs) at 'B+'. The Outlook on the IDRs is Stable. Fitch has also
downgraded the rating of Beluga's senior unsecured rouble bonds
to 'B' with a Recovery Rating of 'RR5' from 'B+'/'RR4'.

The ratings and Stable Outlook reflect Fitch expectation of
improving consumer sentiment in Russia and a stable regulatory
environment over the next four years, which would allow Beluga to
maintain acceptable leverage and operating margins. The ratings
remain underpinned by Beluga's leading position in the Russian
alcoholic beverages market, which is supported by a portfolio of
national and regional brands as well as a more developed
distribution platform and larger scale of operations than most
competitors. The ratings also factor in an adequate liquidity
position, good access to external financing and capex
scalability, which balance Beluga's weak free cash-flow profile.

The downgrade of the rating of senior unsecured local bonds to
'B'/'RR5' reflects a deterioration in recovery prospects after
inclusion of factoring as prior-ranking debt in Fitch recovery
analysis.

KEY RATING DRIVERS

Stable Market Environment: Fitch expect the market environment
for Beluga and other legal spirits producers to be less
challenging over 2018-2020 than in the past five years, which
were characterised by steep excise tax increases, a deterioration
in consumer sentiment and fierce competition from illegal
players.

The regulatory environment should be stable as, according to the
Russian tax code, excise duties on ethanol will be unchanged in
2018-2019 and grow by only 4% in 2020. Fitch also believe that
government measures against the illegal market in 2016 were
effective and Fitch do not assume a rebound in illegal
production, as proven in 2017. At the same time, a gradual
improvement in consumer spending in Russia could result in
consumers shifting towards more expensive spirits and legal
production from 2019-2020, further supporting Beluga's sales.

Moderate EBITDA Growth: Fitch projects Beluga's EBITDA will grow
moderately over the medium term, driven primarily by average
selling price increases and tight control over costs. Fitch
expect spirits sales volumes to grow by around 1% per year,
supported mostly by an assumed 4% annual growth in imports of
spirits. However, Fitch do not rule out that import business may
grow faster as Beluga's nationwide distribution platform makes it
an attractive partner for foreign spirits producers and there is
still room to add products to fill Beluga's offering.

Moderate Diversification: Beluga's product diversification has
been gradually improving over the past five years, although the
company remains heavily exposed to the Russian vodka market. The
production of brandy and flavoured liquors and spirits imports
altogether accounted for 37% of its alcohol segment revenues in
2016 against 21% in 2012. Fitch expect further gradual product
diversification to be driven both by the expansion of its own
production of brown spirits and the distribution of third-party
brands.

Factoring Adjustment Leads to Higher Leverage: Following
additional disclosures by the company, Fitch has retrospectively
adjusted Beluga's trade receivables and debt by adding the
outstanding amount of factored assets at year-end (2016: RUB3.9
billion). This treatment of factoring is based on the recurrent
operational nature of underlying assets and Fitch assumes Beluga
will continue using factoring facilities to fund its working-
capital needs over the medium term. The factoring adjustment led
to around 0.8x higher FFO adjusted leverage over 2013-2016 than
Fitch previous calculations.

Tight Rating Headroom: Beluga's leverage remains acceptable for
the rating, despite the factoring adjustment, but its rating
headroom has now tightened. Fitch project FFO adjusted leverage
will stay close to 4.5x over the next four years (2016: 4.1x),
the highest leverage consistent with the rating, given Beluga's
lower-than-peers' profitability and cash generation. A weaker-
than-expected operating performance, for example due to lower
sales or operating profit margins resulting in permanently
impaired credit metrics, could put pressure on the rating or
Outlook.

Potential Consolidation of Winelab: Fitch projections do not
incorporate the potential acquisition of a controlling stake in
the small Russian alcoholic beverages retailer Winelab as timing
and terms are not defined yet. Beluga currently owns a 49% stake
in the company and accounts for it as an investment in an
associate worth RUB1,090 million. The consolidation of Winelab
may result in some dilution of Beluga's operating margins as the
retail business is low margin in nature, while the potential
impact on leverage cannot be assessed at the moment.

No Cash Outflow From Share Buybacks: On 20 November 2017 Beluga
announced a share buyback programme of up to RUB3.3 billion, but
Fitch expect that this will be neutral for the group's cash flow.
The company intends to cancel shares held by Beluga's
subsidiaries, while the announced buyback share price of RUB600
is unlikely to be attractive to external investors.

DERIVATION SUMMARY

Beluga has smaller scale and narrower geographic and product
diversification than other Fitch-rated spirits producers, such as
Diageo plc (A-/Stable), Becle, S.A.B. de C.V. (BBB+/Stable),
Pernod Ricard S.A. (BBB/Positive) and Thai Beverage (BBB/RWN). In
addition to lower profitability, weaker leverage and FFO fixed
charge coverage and mostly negative free cash flow (FCF), this
explains the large differential in ratings compared with its
peers. At the same time, the 'B+' rating is supported by the
company's leading market position in Russia and strong brand
portfolio.

Beluga's ratings take into consideration the higher-than-average
systemic risks associated with the Russian business and
jurisdictional environment. No Country Ceiling or
parent/subsidiary linkage aspects were in effect for these
ratings.

KEY ASSUMPTIONS

Fitch's key assumptions within Fitch rating case for the issuer
include:
- no increase in excise duties on ethanol over 2018-2019, then
   4% increase in 2020 as per the Russian tax code;
- sales volumes of own brands stable over 2017-2021;
- around 40% increase in imported spirits' volumes in 2017 and
   4% growth per year over 2018-2021;
- annual net selling price increases slightly below CPI;
- EBITDA margin at around 10%;
- capex at around RUB1 billion per year;
- no M&A;
- the ratings currently do not incorporate the potential
   acquisition of a controlling stake in the alcohol retail
   chain, which is currently accounted as associate;
- share buybacks not exceeding RUB300 million in 2018, no share
   buybacks thereafter.

RATING SENSITIVITIES

Future Developments That May, Individually or Collectively, Lead
to a Positive Rating Action
- Increasing diversification towards a higher share of non-vodka
   products and/or growing share of exports in its profits
- FCF turning and remaining positive, with EBITDAR margin of
   around 15%
- FFO-adjusted leverage below 3.5x and FFO fixed charge coverage
   above 2x on a sustained basis

Future Developments That May, Individually or Collectively, Lead
to a Negative Rating Action
- Deterioration in FFO-adjusted leverage to above 4.5x and of
   FFO fixed charge coverage ratio below 1.5x for a sustained
   period
- Persistently negative free cash flow (FCF) and weak liquidity
   not mitigated by asset disposals or equity injections
- Contraction of EBITDAR margin to below 10% for a sustained
   period
- Regulatory changes or rebound in illegal production in the
   Russian spirits sector that may put more pressure on the
   company's sales and profitability

LIQUIDITY

Adequate Liquidity: As of 29 September 2017 Beluga had an
adequate liquidity position as readily available cash of RUB0.6
billion and undrawn committed facilities of RUB3.7 billion were
sufficient to cover Fitch-adjusted short-term debt of RUB2.7
billion and expected negative FCF in 2018. Fitch treated the
outstanding factoring amount of RUB2.0 billion as a short-term
obligation of the company.

In addition to adequate liquidity, Beluga's financial flexibility
is also supported by capex scalability and the fact that around
75% of its debt matures after 2019.

KEY RECOVERY RATING ASSUMPTIONS

Increased Prior-Ranking Debt: Fitch has downgraded the rating of
Beluga's senior unsecured rouble bonds to 'B'/'RR5' from
'B+'/'RR4' due to the inclusion of factoring as prior-ranking
debt in Fitch recovery analysis. The bonds are structurally
subordinated to factoring and other debt of operating companies
as they are issued by the holding company and do not feature any
guarantees. Based on Fitch's liquidation valuation approach, the
rouble bonds have below-average recovery prospects, which lead to
their rating one notch below Beluga's IDR of 'B+'.

Key Recovery Rating Assumptions: The recovery analysis assumes
that Beluga would be liquidated rather than reorganised in a
bankruptcy. The liquidation estimate reflects Fitch's view of the
value of inventory and other assets that can be realised in a
reorganisation and distributed to creditors. Fitch have assumed a
10% administrative claim in the recovery analysis.

Fitch has assumed that Beluga's undrawn committed lines would be
fully drawn upon default. The debt waterfall has also included
trade payables and 25% of the highest amount of factoring drawn
in the last 12 months. Fitch has treated the rouble bonds issued
by the holding company as structurally subordinated to the rest
of the group's debt.

The waterfall results in a 28% recovery corresponding to a 'RR5'
recovery rating for the senior unsecured rouble bonds. Therefore,
the instrument rating is one notch below Beluga's IDR.


DME LIMITED: Moody's Assigns Ba1 CFR, Outlook Positive
------------------------------------------------------
Moody's Investors Service has assigned a first-time non-
investment grade Ba1 corporate family rating (CFR) and Ba1-PD
probability of default (PDR) rating to DME Limited (Domodedovo)
(DME), the owner and operator of the second largest airport in
Russia. Concurrently, Moody's has also assigned a Ba1 rating with
a loss given default assessment of LGD4 to the proposed senior
unsecured USD loan participation notes (LPNs) to be issued by,
but with limited recourse to, DME Airport DAC, an orphan vehicle
incorporated under the laws of Ireland. The outlook on the
ratings is positive.

RATINGS RATIONALE

The Ba1 rating reflects DME's position as the second largest
airport in a large and growing Moscow Air Cluster (MAC), the
major gateway to Russia and The Commonwealth of Independent
States (CIS). The competition in the catchment area is, however,
high with the presence of other two large airports, Sheremetyevo
and Vnukovo.

In particular, in 2015, DME lost the leadership to its key
competitor, Sheremetyevo, a hub for the national flag carrier and
the clear market leader, Aeroflot Group. Apart from the overall
weak economic conditions and rouble depreciation, which pressured
outbound travel in 2015-16, DME's competitive position has been
affected by a number of adverse factors such as: (1) bans on air
travel to Ukraine, Turkey, and Egypt in autumn 2015, with the
latter two historically accounting for a significant share of the
airport's non-regular flights; (2) optimisation of capacity in
response to the downcycle by foreign carriers, to which DME has
high exposure; and (3) the exit of Transaero in end-2015, the
second-largest client at that time, and the third-largest Vim-
Avia in October 2017.

Nevertheless, DME retained a fairly resilient operating
performance, although behind the market. In 2015-16, its
passenger numbers went down by 8% and 7%, respectively, and in
2017 resumed growth rising by around 8% on the back of the
stabilising economy and the reopening of flight toTurkey in
August 2016. Moody's expects DME to sustain single-digit growth
in the medium-term, while the potential reopening of charter
flights to Egypt may further boost its traffic.

Overall, although the ambitious long-term expansion programmes by
the major airports in the area should intensify competition in
the coming years, DME should be able to preserve its strong
market position supported by: (1) the vast MAC market with solid
growth potential; (2) DME's well-developed airport and transport
infrastructure with the largest runway capacity and a sizable
land bank located in the area with low population density, which
limits physical or legal/regulatory constraints for future
development; (3) a diversified carrier base and a high proportion
of origin and destination traffic; and (4) its wide service
offering and competitive pricing.

DME is also now at the final stage of a sizeable expansion
programme, which, among others, includes the construction of a
new terminal for international flights due to open before the
2018 Football World Cup. Moreover, in 2Q 2018, the Russian
government will commission for DME a new runway to replace one of
the existing two, as well as reconstruct the existing aprons and
build new ones. As a result, DME will improve its service
offering and will have sufficient capacity headroom to
accommodate the expected market growth in the medium-term, while
tripling the retail area, which it historically lacked. In the
longer term, DME may consider construction of the third runway
and further expansion of its terminal and other airport
facilities; however, these investment plans remain highly
flexible and modular.

The rating also takes into account the tariff liberalisation in
the MAC in February 2016, which allows DME a certain flexibility
to keep adequate level of earnings and margins in a competitive
market, although the limited track record of the new light-handed
regime and still evolving regulatory environment in Russia
provides some risks of potential re-introduction of state
regulation. Overall, in 2018-19, Moody's expects DME's revenue to
grow at a double-digit percent rate, further supported by: (1)
the substantial increase in high-margin commercial revenue
following the opening of the new terminal and parking in 2Q 2018;
and (2) the expected increase in passenger traffic. The company's
profitability should also improve to its historical levels at
reported EBITDA margin of above 40% after some decrease in 2015-
17 largely driven by the drop in the more profitable
international traffic.

Furthermore, DME's rating is supported by its strong financial
profile through the industry and investment cycles and despite a
fairly shareholder-friendly financial policy. In particular, in
2016, although the airport significantly scaled up its capital
expenditure and paid out substantial dividends, its adjusted
leverage (measured as FFO/debt) stayed healthy at above 20%. DME
also retained a comfortable cash balance and stayed well in
compliance with its financial policy with the reported net
debt/EBITDA at around 1.6x vs. the internal leverage target of
net debt/EBITDA of below 3.0x.

In 2017-18, whereas the investment will peak at around RUB15
billion per year, DME's adjusted leverage will remain stable at
around 20%, supported by the improving operating performance and
modest dividend payout plans. In 2019, as the company's capital
expenditure moderates and it resumes positive free cash flow
generation, DME will start gradual deleveraging with adjusted
FFO/debt trending towards 30%.

Although DME is exposed to foreign-exchange risks as the majority
of its debt is denominated in foreign currency, it also generates
around 50% of revenue in US dollars and Euro, which provides some
natural hedge. Moreover, under its financial policy, DME holds
most of its cash balance in foreign currency.

DME's credit profile also benefits from a strong liquidity
position driven by a substantial cash balance available as of end
2017, and a track record of uninterrupted access to domestic and
international capital markets and bank funding. Moody's expect
DME to successfully refinance the outstanding $221.5 million
notes due in November 2018 with the issue of the upcoming new
Eurobond, following which the company will have a very
comfortable debt maturity profile with no major debt repayments
until November 2021.

At the same time, the rating is constrained by the evolving
regulatory environment and an overall less developed legal,
political and economic framework in Russia which increases risks
of potential state interference. It also exposes DME to legal
risks, particularly in view of the fairly recent criminal
investigation against the company's shareholder, which was,
however, successfully resolved in 2016. As a single shareholder
company, DME also has weaker corporate governance standards which
heightens the risk of elevated shareholder distributions.

DME's rating is strongly positioned at Ba1 and is currently
constrained by Russia's government bond rating and its outlook,
due to the company's predominant exposure to the health of the
Russian domestic economy, lack of revenue diversification outside
of the country and its exposure to domestic regulatory oversight.

STRUCTURAL CONSIDERATIONS

DME Airport DAC will issue the notes for the sole purpose of
financing a loan to Hacienda Investments Ltd, a wholly owned
subsidiary of DME Limited, which owns substantially all of the
company's real estate assets, pursuant to a loan agreement
between the two companies. The loan will be guaranteed by DME
Limited and its major operating subsidiaries, which account for
more than 85% of the group's consolidated EBITDA and assets.
Noteholders will only have limited recourse to the issuer and
will rely solely on DME's credit quality to service and repay the
debt.

The issuance proceeds will be primarily used for repayment of the
outstanding $221.5 million notes due in November 2018 and for
general corporate purposes.

The notes' rating of Ba1 is at the same level as DME's rating,
which reflects Moody's assumption that: (1) the notes will rank
pari passu with other unsecured and unsubordinated obligations of
DME's group; and (2) the company has no secured debt in its
capital structure.

RATIONALE FOR THE POSITIVE OUTLOOK

The positive outlook is in line with the positive outlook on the
sovereign rating. The outlook also reflects Moody's expectation
that the company will maintain sound financial and liquidity
profiles and preserve its strong market position, while
delivering on operating targets and successfully completing its
investment programme.

WHAT COULD CHANGE THE RATINGS UP/DOWN

The rating could be upgraded, subject to an upgrade of Russia's
government bond rating, provided there is no material
deterioration in company-specific factors, including its
operating and financial performance, from current levels.

The downgrade risk is currently remote, given the positive
outlook on the rating. A negative pressure on the rating could
develop if DME's financial profile were to weaken as a result of,
among others, (1) substantial deterioration in the company's
competitive position resulting in a weak traffic performance; (2)
aggressive debt-financed dividend payouts or other substantial
shareholder distributions; (3) material adverse changes to the
regulatory framework. Moody's would also consider downgrading the
ratings in the event of major impediments to the completion of
its investment programme or increasing concerns related to
political, legal risks or corporate governance. A significant
deterioration of the company's liquidity profile including
failure to refinance the upcoming bond maturity in 2018 could
also exert downward pressure on the rating. The rating is likely
to be downgraded if there is a downgrade of Russia's sovereign
rating.

PRINCIPAL METHODOLOGY

The principal methodology used in these ratings was Privately
Managed Airports and Related Issuers published in September 2017.

DME Limited (Domodedovo) (DME) is the owner and operator of
Domodedovo international airport located near Moscow, the second
largest airport in Russia and Eastern Europe in terms of
passenger and cargo volume with around 31 million passengers
handled in 2017. In 12 months ended June 30, 2017, DME generated
around RUB38.7 billion of revenue and RUB16.5 billion of adjusted
EBITDA. DME is ultimately controlled by Dmitry Kamenshchik.


GLOBALTRANS INVESTMENT: Fitch Affirms BB+ Long-Term FC IDR
----------------------------------------------------------
Fitch Ratings has affirmed freight rail transportation company
Globaltrans Investment Plc's (GLTR) Long-Term Foreign-Currency
Issuer Default Rating (IDR) at 'BB+' with a Stable Outlook and
assigned wholly owned subsidiary Open joint stock company New
Forwarding Company's (NFC) proposed notes under a RUB100 billion
prospective domestic bond programme an expected local currency
senior unsecured rating of 'BB+(EXP)'.

Fitch rates the proposed domestic notes to be issued by NFC, one
of GLTR's key subsidiaries, at the same level as GLTR's Long-Term
Local Currency IDR due to the benefit of the public irrevocable
offer to be issued by GLTR. The final rating is contingent on the
receipt of final documents conforming materially to information
already received.

The rating affirmation reflects the solid financial and
operational profiles of GLTR on the back of improved market
conditions led by a recovery in the Russian economy, improving
gondola rates as well as low FX risks. Fitch expects GLTR's funds
from operations (FFO) adjusted net leverage to average around 1x
over 2017-2020. This is partially offset by GLTR's exposure to
cyclicality and smaller scale of operations compared with JSC
Freight One. GLTR is one of the leading rolling-stock operators
in a highly fragmented Russian freight rail transportation
market, accounting for about 8% of 1H17 freight rail volumes.

KEY RATING DRIVERS

GLTR's Opco to Issue Bonds: NFC is one of GLTR's main operating
subsidiaries. NFC expects to issue bonds under its registered
RUB100 billion domestic bond programme. NFC is 100%-owned by GLTR
and fully consolidated in the group accounts. NFC generates
around 57% of GLTR's net cash from operating activities and owns
about 42% of its property, plant and equipment in 1H17. GLTR
provided sureties for the majority of NFC's outstanding debt at
end-6M17.

The bonds' proceeds are intended to be used for general corporate
purposes, refinancing existing debt and funding investment
programme. As a result, Fitch expect limited impact on GLTR's
leverage metrics following this transaction compared to Fitch
previous forecasts.

Public Irrevocable Offer: Bondholders will benefit from GLTR's
public irrevocable offer under which the parent undertakes to
offer to purchase the bonds if NFC is in default, making this
instrument effectively recourse to GLTR. Fitch understands that
GLTR's obligation under the irrevocable offer will rank pari
passu with the group's unsecured obligations. As a result, Fitch
rates the proposed notes at the same level as GLTR's Long-Term
Local Currency IDR. This is also supported by prior-ranking debt
constituting less than 2x of group EBITDA.

Improved Performance: GLTR reported strong 1H17 results. Its
revenue reached RUB38.2 billion, up 16.8% yoy, driven by improved
rail transportation volumes in Russia, improving gondola rates
and efficient fleet management, with the overall empty-run ratio
improving to 47% in 1H17 from 48% in 1H16 (38% from 39% for
gondola cars). Fitch expect mid-single-digit revenue growth and
an improved EBITDA margin adjusted by Fitch for pass-through
items to average 41% in 2017-2020, up from 38% in 2015-2016.
Fitch estimate free cash flow (FCF, Fitch-calculated) in 2017 to
be negative, due to a special dividend, before turning positive
thereafter.

Rate-Supportive Overcapacity Reduction: The ban on the use of old
railcars from 2016 prompted their gradual retirement and the
overall railcar number in the market has decreased by 13% from
its 2014 level (16% in gondolas and 11% in tank cars). GLTR
benefited from the ban as its railcars had an average age of 9.4
years for gondolas and 13.8 years for rail tank cars at end-1H17,
respectively, compared with an average useful life of 22 years
and 32 years. The capacity reduction, together with limited
production of new railcars, supported the recovery of gondola
rates in 2016-2017.

Fitch expects a further improvement in gondola rates in 1H18,
albeit at a slower pace, as old railcars continue to be retired,
the production of new railcars remains limited and moderate
economic growth continues.

Long-Term Contracts Mitigate Customer Concentration: GLTR's
ratings are constrained by customer concentration as its top-five
customers accounted for 70% of net revenue from operation of
rolling stock in 1H17. This is partially mitigated by the long-
term nature of service contracts with the top-three customers,
which accounted for around 60% of net revenue from the operation
of rolling stock in 1H17, and counterparties' strong credit
quality. GLTR intends to diversify its customer base by
increasing the number of mid- and small-size clients. Further
expansion of longer-term agreements with customers should
increase its cash-flow visibility.

Focus on Non-Oil Cargoes: GLTR has focused on non-oil, especially
metallurgical cargoes, increasing their share in transportation
turnover to 87% in 2016, from 78% in 2012. Despite a decrease in
oil and oil products turnover in 2012-2016, total turnover
increased by 6% CAGR in the period. Fitch expect overall market
freight rail volumes to continue to recover in 2018 at low-
single-digit rates as Fitch forecast Russian GDP to grow 2% in
2018. Dry cargo is likely to see a much greater recovery than oil
and oil products, which Fitch expect to continue to be pressured
by increased competition from existing pipelines, commissioning
of new pipelines, and decreasing production volumes of oil
products.

Large Operator: GLTR is one of the largest freight railcar
transportation groups in Russia by transported volumes by rail
with about an 8% market share; however, it operates on a smaller
scale than JSC Freight One. GLTR benefits from a modern railcar
fleet relative to Russian peers and its maintenance and fleet
renewal costs are smaller.

DERIVATION SUMMARY

GLTR's credit profile is somewhat stronger than JSC Freight One's
(BB+/Stable) but is similar to that of PJSC Transcontainer
(BB+/Stable), the largest Russian rail container transportation
company. Transcontainer operates in a more volatile market and on
a smaller scale. GLTR's ratings are constrained by its smaller
size relative to JSC Freight One, a relatively complex group
structure and concentrated customer base, although the latter is
somewhat mitigated by its medium- to long-term contracts with
major clients. Unlike JSC Freight One, GLTR focuses on
transportation of higher-priced metallurgical cargo and oil
products and operates a relatively young railcar fleet. Most of
the Russian rail transportation companies, including GLTR, remain
disciplined in terms of FX exposure.

KEY ASSUMPTIONS
Fitch's Key Assumptions within Fitch Rating Case for the Issuer
- Domestic GDP growth of 1.8%-2% over 2017-2020.
- Inflation of 3.7%-4.5% over 2017-2020.
- Freight transportation rates to have increased above inflation
   in 2017 but to rise below inflation thereafter.
- Capex in line with management expectations at slightly above
   2016 levels in 2017 and at about 2016 levels from 2018.
- Dividends of RUB15 billion paid in 2017 in respect of 2016 and
   1H17 and as per management expectations in line with approved
   dividend policy thereafter.

RATING SENSITIVITIES

Developments That May, Individually or Collectively, Lead to
Positive Rating Action
- Further diversification of the customer base and lengthening
   of contract duration with better volume visibility and lower
   rate volatility.
- Sustained stronger economic growth and infrastructure
   improvements and/or a substantial increase in GLTR's market
   share in terms of fleet numbers and consequently transported
   volumes and revenue, allowing greater efficiency.

Developments That May, Individually or Collectively, Lead to
Negative Rating Action
- A sustained rise in FFO lease-adjusted net leverage above 2x
   and FFO fixed charge coverage of below 3x, which would have
   rating implications, due to GLTR's complex corporate
   structure, and lead to a rating review.
- Sustained slowdown of the Russian economy leading to material
   deterioration of the group's credit metrics.
- Unfavourable changes in Russian legislative framework for the
   railway transportation industry, which continues to be under
   reform.

LIQUIDITY

Upcoming Debt Maturities: Over 75% of GLTR's total debt matures
in the next three years, but Fitch believe it will retain good
access to the local financial market and view GLTR's liquidity
position as manageable. At end-1H17 GLTR's cash and cash
equivalents were RUB8.8 billion and, together with unused credit
facilities from Russian subsidiaries of European banks, are
sufficient to cover short-term maturities of RUB7.4 billion,
despite negative FCF (as calculated by Fitch) estimated for 2017
due to special dividend payment.

Limited FX and Rate Risks: GLTR is not exposed to FX fluctuations
as only a negligible share of operating expenses is denominated
in foreign currencies and at end-1H17, almost all of its debt was
denominated in roubles. Interest rates are fixed, eliminating
interest-rate risks. Dividends are paid in US dollars, but
announced in roubles and converted into US dollars on the date of
the annual general meeting/board approval. GLTR holds part of its
cash in foreign currencies.

FULL LIST OF RATING ACTIONS

Globaltrans Investment PLC
- Long-Term Foreign- and Local-Currency Issuer Default Ratings
   (IDR): affirmed at 'BB+'; Stable Outlook
- Short-Term Foreign- and Local-Currency IDRs: affirmed at 'B'

Opened joint-stock company New Forwarding Company
- Expected local currency senior unsecured rating: assigned at
   'BB+(EXP)'


POWER MACHINES: Moody's Withdraws B2 Corporate Family Rating
------------------------------------------------------------
Moody's Investors Service has withdrawn all ratings of Power
Machines PJSC. At the time of withdrawal the ratings were:
corporate family rating of B2 and probability of default rating
of B2-PD. At the time of withdrawal the ratings had a negative
outlook.

RATINGS RATIONALE

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


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


BUSINESS MORTGAGE 5: Moody's Affirms Ca Ratings on 2 Tranches
-------------------------------------------------------------
Moody's Investors Service has upgraded the ratings of 5 classes
of Notes and affirmed the ratings of 20 classes of Notes across
the Business Mortgage Finance PLC series of UK SME transactions.

Issuer: Business Mortgage Finance 3 PLC (BMF 3)

-- GBP42.5M Class M Notes, Upgraded to Aaa (sf); previously on
    Jun 17, 2016 Affirmed Aa2 (sf)

-- GBP9.5M Class B1 Notes, Upgraded to Aa2 (sf); previously on
    Jun 17, 2016 Upgraded to A2 (sf)

-- EUR8M Class B2 Notes, Upgraded to Aa2 (sf); previously on Jun
    17, 2016 Upgraded to A2 (sf)

Issuer: Business Mortgage Finance 4 PLC (BMF 4)

-- GBP41.25M Class M Notes, Affirmed Aa2 (sf); previously on Jun
    17, 2016 Upgraded to Aa2 (sf)

-- GBP15M Class B Notes, Affirmed B1 (sf); previously on Jun 17,
    2016 Upgraded to B1 (sf)

Issuer: Business Mortgage Finance 5 PLC (BMF 5)

-- GBP100M Class A1 Notes, Affirmed Aa2 (sf); previously on Aug
    14, 2015 Affirmed Aa2 (sf)

-- EUR180M Class A2 Notes, Affirmed Aa2 (sf); previously on Aug
    14, 2015 Affirmed Aa2 (sf)

-- Class A1 DAC Notes, Affirmed Aa2 (sf); previously on Aug 14,
    2015 Affirmed Aa2 (sf)

-- Class A2 DAC Notes, Affirmed Aa2 (sf); previously on Aug 14,
    2015 Affirmed Aa2 (sf)

-- GBP27M Class M1 Notes, Affirmed B3 (sf); previously on Aug
    14, 2015 Affirmed B3 (sf)

-- EUR36.5M Class M2 Notes, Affirmed B3 (sf); previously on Aug
    14, 2015 Affirmed B3 (sf)

-- GBP12M Class B1 Notes, Affirmed Ca (sf); previously on Aug
    14, 2015 Affirmed Ca (sf)

-- EUR11.5M Class B2 Notes, Affirmed Ca (sf); previously on Aug
    14, 2015 Affirmed Ca (sf)

Issuer: Business Mortgage Finance 6 PLC (BMF 6)

-- GBP106M Class A1 Notes, Affirmed Aa2 (sf); previously on Jun
    17, 2016 Affirmed Aa2 (sf)

-- EUR400.7M Class A2 Notes, Affirmed Aa2 (sf); previously on
    Jun 17, 2016 Affirmed Aa2 (sf)

-- Class A1 DAC Notes, Affirmed Aa2 (sf); previously on Jun 17,
    2016 Affirmed Aa2 (sf)

-- Class A2 DAC Notes, Affirmed Aa2 (sf); previously on Jun 17,
    2016 Affirmed Aa2 (sf)

-- GBP38M Class M1 Notes, Affirmed Caa3 (sf); previously on Jun
    17, 2016 Downgraded to Caa3 (sf)

-- EUR55.6M Class M2 Notes, Affirmed Caa3 (sf); previously on
    Jun 17, 2016 Downgraded to Caa3 (sf)

-- EUR39.1M Class B2 Notes, Affirmed C (sf); previously on Aug
    14, 2015 Affirmed C (sf)

Issuer: Business Mortgage Finance 7 PLC (BMF 7)

-- GBP187.5M Class A1 Notes, Upgraded to Aa2 (sf); previously on
    Aug 14, 2015 Upgraded to Aa3 (sf)

-- Class A1 DAC Notes, Upgraded to Aa2 (sf); previously on Aug
    14, 2015 Upgraded to Aa3 (sf)

-- GBP38.65M Class M1 Notes, Affirmed Caa3 (sf); previously on
    Aug 14, 2015 Affirmed Caa3 (sf)

-- EUR5M Class M2 Notes, Affirmed Caa3 (sf); previously on Aug
    14, 2015 Affirmed Caa3 (sf)

-- GBP12.375M Class B1 Notes, Affirmed C (sf); previously on Aug
    14, 2015 Affirmed C (sf)

Business Mortgage Finance 3 PLC (BMF 3), Business Mortgage
Finance 4 PLC (BMF 4), Business Mortgage Finance 5 PLC (BMF 5),
Business Mortgage Finance 6 PLC (BMF 6) and Business Mortgage
Finance 7 PLC (BMF 7) are securitisations of non-conforming
commercial mortgage loans originated and brought to market in the
period 2005-2007. The loans were originated by Commercial First
Mortgages Limited (CFML) and Commercial First Business Limited
and are secured on commercial, quasi-commercial or, in limited
cases, residential properties located throughout the UK. The
transactions were structured with a detachable A coupon (DAC)
which was stripped from the related Class A Note; ratings on the
DAC Notes (Interest-Only) are derived from the rating on the
referenced bond. The Special Servicer and Cash/Bond Administrator
in the transactions changed in December 2016 to Target Servicing
Limited (Target) from CFML.

RATINGS RATIONALE

The rating actions reflect:

BMF 3:

- Deal deleveraging resulting in an increase in credit
   enhancement for the affected tranches.

BMF 4:

- Moody's affirmed the ratings of the notes that had sufficient
   credit enhancement to maintain current rating on the affected
   notes.

BMF 5:

- Moody's affirmed the ratings of the notes that had sufficient
   credit enhancement to maintain current rating on the affected
   notes.

BMF 6:

- Moody's affirmed the ratings of the notes that had sufficient
   credit enhancement to maintain current rating on the affected
   notes.

BMF 7:

- Deal deleveraging resulting in an increase in credit
   enhancement for the senior tranches.

- Moody's affirmed the ratings of the notes that had sufficient
   credit enhancement to maintain current rating on the affected
   notes.

Generally, the ratings of the notes of all transactions are
capped at Aa2 (sf) due to Moody's assessment of the Financial
Disruption Risk present in the transactions. The assessment
considered the likelihood of a future disruption occurring, and
the ease of transfer of duties such as servicer, cash manager and
calculation agent. The experience of the transfer of the
servicing to Target from CFML highlighted concerns over the
number of possible replacement servicers, and the sufficiency of
the current servicing fee structure. In the case of BMF 3, the
presence of a non-amortising Reserve Fund currently funded at a
level equal to 90% of the most senior outstanding notes, together
with adequate liquidity resources and a very high level of credit
enhancement, allowed the ratings of the most senior outstanding
notes to pierce the general Financial Disruption Risk cap.

Revision of Key Collateral Assumptions

As part of the rating actions, Moody's reassessed its expected
loss (EL) assumptions for the portfolios, considering their
respective collateral performance to date.

BMF 3

Total delinquencies in the transaction remain at relatively high
levels, standing at 26.72% of the collateral pool in November
2017 compared to 22.39% of the pool in November 2016. However, in
the same period cumulative losses have shown only a slight
increase, moving in November 2017 to 7.13% of the original pool
balance (OB) compared to 7.00% in November 2016. Deal
deleveraging through repayment of the underlying collateral has
increased the Class M credit enhancement (CE) to 96.42% in
November 2017 from 78.87% in November 2016, whilst for the pari-
passu B1 and B2 Notes, the CE has increased to 43.43% from
35.00%.

Moody's has maintained its EL assumption on the current pool
balance at 14.12% and adjusted its EL on the original balance
downwards to 8.73%. The coefficient of variation (CoV) now stands
at 34.83% with the PCE maintained at 40.00%.

BMF 4

The outstanding percentage of total delinquencies in the
transaction has improved, standing at 19.52% of the collateral
pool in November 2017 compared to 24.40% in November 2016.
Cumulative losses have remained steady, increasing slightly to
12.74% of OB in November 2017 from 12.47% in November 2016.
Deleveraging has improved the CE for Classes M and B although the
trend is not as strong as in BMF 3. BMF 4 Class M CE now stands
at 48.78% in November 2017 from 40.83% in November 2016, whilst
for the Class B notes the CE now stands at 17.79% from 13.99%.

Moody's has maintained its EL assumption on the current pool
balance at 14.12% and adjusted its EL on the original balance
downwards to 15.47%. The coefficient of variation (CoV) now
stands at 34.25% with the PCE maintained at 40.00%

BMF 5

Outstanding delinquencies in the transaction have shown a small
increase in percentage terms, moving to 25.50% of the collateral
pool in November 2017 from 24.14% in November 2016. Likewise,
losses have shown a small increase and stand at 16.49% of OB in
November 2017 from 15.59% in November 2016. The Reserve Fund in
BMF 5 is completely depleted and losses now flow directly to the
PDL ledgers within the transaction. Nonetheless, deal
deleveraging has been sufficient to improve the CE levels on the
Classes A1, A2, M1 and M2 notes, whilst there has been a slight
decrease in CE levels for the Classes B1 and B2 notes. Class A1
and A2 CE is calculated at 71.92% in November 2017 from 62.31% in
November 2016, Class M1 and M2 CE is calculated at 16.67% in
November 2017 from 14.15% in November 2016, and Class B1 and B2
CE is negative (due to an uncleared PDL balance) and stands at -
4.48% in November 2017.

Moody's has maintained its EL assumption on the current pool
balance at 21.39% and adjusted its EL on the original balance
downwards to 22.31%. The coefficient of variation (CoV) now
stands at 27.63% with the PCE maintained at 50.00%.

BMF 6

Outstanding delinquencies have been remained at steady levels and
are reported at 18.16% of the collateral pool in November 2017
from 18.08% of the collateral pool in November 2016. There has
been a small increase in reported cumulative losses, standing in
November 2017 at 15.54% of OB compared to 15.04% in November
2016. The Reserve Fund is completely depleted (against a required
amount of GBP 21.25M). Continual steady deal deleveraging has
increased the CE levels on the Classes A1 and A2 notes to 43.35%
in November 2017 from 37.68% in November 2016 whilst there has
been very little movement in the CE levels on the Classes M1 and
M2, where the CE is calculated at 3.14% in November 2017 from
2.75% in November 2016. The Class B2 CE stands at -11.01% in
November 2017, reflecting the uncleared PDL balance within the
transaction.

Moody's has maintained its EL assumption on the current pool
balance at 21.89% and adjusted its EL on the original balance
downwards to 22.15%. The coefficient of variation (CoV) now
stands at 26.83% with the PCE maintained at 50.00%.

BMF 7

Outstanding delinquencies have been improved and are reported at
15.02% of the collateral pool in November 2017 from 16.06% of the
collateral pool in November 2016. There has been a very small
increase in reported cumulative losses, standing in November 2017
at 16.08% of OB compared to 15.92% in November 2016. The Reserve
Fund is completely depleted (against a required amount of GBP
11.63M). Continual steady deal deleveraging has increased the CE
levels on the Classes A1 to 39.06% in November 2017 from 35.63%
in November 2016 whilst there has been very little movement in
the CE levels on the Classes M1 and M2, where the CE is
calculated at 1.35% in November 2017 from 1.45% in November 2016.
The Class B1 CE stands at -9.7% in November 2017, reflecting the
uncleared PDL balance within the transaction.

Moody's has maintained its EL assumption on the current pool
balance at 20.19% and adjusted its EL on the original balance
downwards to 23.61%. The coefficient of variation (CoV) now
stands at 26.30% with the PCE maintained at 45.00%.

Increase in Available Credit Enhancement

Sequential amortization and non-amortising reserve funds led to
the increase in the credit enhancement available in these
transactions.

Counterparty Exposure

The rating actions took into consideration the notes' exposure to
relevant counterparties, such as servicer, account banks or swap
providers.

Moody's considered how the liquidity available in the
transactions and other mitigants support continuity of note
payments, in case of servicer default. The Servicer (Special
Servicer) is unrated. Generally, the ratings of the notes of all
transactions are capped at Aa2 (sf) due to Moody's assessment of
the Financial Disruption Risk present in the transactions. The
assessment considered the likelihood of a future disruption
occurring, and the ease of transfer of duties such as servicer,
cash manager and calculation agent. The experience of the
transfer of the servicing from CFML to Target highlighted
concerns over the number of possible replacement servicers, and
the sufficiency of the current servicing fee structure. In the
case of BMF 3, the presence of a non-amortising Reserve Fund
currently funded at a level equal to 90% of the most senior
outstanding notes, together with adequate liquidity resources and
a very high level of credit enhancement, allowed the ratings of
the most senior outstanding notes to pierce the general Financial
Disruption Risk cap.

Moody's assessed the exposure to Barclays Bank PLC acting as swap
counterparty in all transactions. Moody's analysis considered the
risks of additional losses on the notes if they were to become
unhedged following a swap counterparty default by using the CR
Assessment as reference point for swap counterparties. Although
there is minor rating sensitivity in some cases, Moody's
concluded that the ratings of the notes are not constrained by
the swap agreement entered between the issuers and Barclays Bank
PLC.

Methodology Underlying the Rating Action

The principal methodology used in rating Business Mortgage
Finance 3 PLC, Business Mortgage Finance 4 PLC, Business Mortgage
Finance 5 PLC Class A1 Notes, Class A2 Notes, Class M1 Notes,
Class M2 Notes, Class B1 Notes, Class B2 Notes, Business Mortgage
Finance 6 PLC, Class A1 Notes, Class A2 Notes, Class M1 Notes,
Class M2 Notes, Class B2 Notes, Business Mortgage Finance 7 PLC,
Class A1 Notes, Class M1 Notes, Class M2 Notes, Class B1 Notes
was "Moody's Global Approach to Rating SME Balance Sheet
Securitizations" published in August 2017. The methodology used
in rating Business Mortgage Finance 5 PLC, Class A1 DAC and Class
A2 DAC Notes, Business Mortgage Finance 6 PLC, Class A1 DAC and
Class A2 DAC Notes, Business Mortgage Finance 7 PLC Class A1 DAC
Notes was "Moody's Approach to Rating Structured Finance
Interest-Only (IO) Securities" published in June 2017.

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

Factors or circumstances that could lead to an upgrade of the
ratings include (1) performance of the underlying collateral that
is significantly better than Moody's expected, (2) deleveraging
of the capital structure and (3) improvements in the credit
quality of the transaction counterparties

Factors or circumstances that could lead to a downgrade of the
ratings include (1) an increase in sovereign risk (2) performance
of the underlying collateral that is worse than Moody's expected,
(3) deterioration in the notes' available credit enhancement and
(4) deterioration in the credit quality of the transaction
counterparties.


CARILLION PLC: CEO Keith Cochrane Apologizes for Collapse
---------------------------------------------------------
Paul Sandle and Sarah Young at Reuters report that the boss of
Carillion, the British construction firm which collapsed last
month, apologized to lawmakers on Feb. 6 as he faced questions
over a failure which put thousands of jobs at risk.

Carillion, which employed nearly 20,000 people in Britain,
collapsed on Jan. 15 when its banks halted funding, triggering
Britain's biggest corporate demise in a decade and forcing the
government to step in to guarantee public services from school
meals to roadworks, Reuters recounts.

"I'm truly sorry," Reuters quotes Interim Chief Executive Keith
Cochrane as saying.  "It was the worst possible outcome.  This
was a business worth fighting for and that's certainly what I
sought to do during my time as chief executive."

Under questioning from lawmakers Mr. Cochrane, as cited by
Reuters, said that net debt was too high at the end of 2016 and
the company was trying to reduce it before it faced a
deterioration of cash flow after March 2017.

Headquartered in Wolverhampton, United Kingdom, Carillion plc --
http://www.carillionplc.com/-- is an integrated support services
company.  The Company operates through four business segments:
Support services, Public Private Partnership projects, Middle
East construction services and Construction services (excluding
the Middle East).


CARILLION PLC: Lawmakers Question Former Finance Director
---------------------------------------------------------
Paul Sandle and Sarah Young at Reuters report that the former
finance director of collapsed British construction firm Carillion
denied being "asleep at the wheel" on Feb. 6 as lawmakers
questioned whether the company had taken on too much risk,
putting thousands of jobs on the line.

"No I don't believe we were asleep at the wheel," Reuters quotes
former FD Zafar Khan as saying.  "I believe I did everything that
I could have done essentially."

His replacement as finance director, Emma Mercer, who had held
other finance roles at the group, said accounting had become more
aggressive in the years before it collapsed but Mr. Khan denied
that there had been a concerted effort to take risk, Reuters
relates.

Mr. Khan's comments prompted a rebuke from opposition lawmaker
Rachel Reeves, Reuters notes.

"Four months after you left, the company went into liquidation
with just 29 million pounds left, leaving thousands of people
potentially without jobs, and thousands of people saving for
pensions without the pensions they'd expected, but you did
everything right at the right time," Reuters quotes Ms. Reeves as
saying.  "Well done Mr Khan."

Headquartered in Wolverhampton, United Kingdom, Carillion plc --
http://www.carillionplc.com/-- is an integrated support services
company.  The Company operates through four business segments:
Support services, Public Private Partnership projects, Middle
East construction services and Construction services (excluding
the Middle East).


EAST COAST: On Verge of Collapse, Government Takeover Mulled
------------------------------------------------------------
Jim Pickard at The Financial Times reports that the British
government is close to taking over operation of the East Coast
mainline after admitting the Virgin-branded franchise is on the
brink of financial collapse.

Chris Grayling, the transport secretary, told the House of
Commons the London-to-Edinburgh operation -- 90% owned by
Stagecoach and 10% by Virgin -- had breached a key financial
covenant and would be able to continue in its current form for
only "a very small number of months and no more", the FT relates.

It was important to find a successor to take over "in the very
near future", including possible direct management by the
Department for Transport through an "operator of last resort",
Mr. Grayling, as cited by the FT, said.  The line was previously
run by the government for more than five years to 2015 after the
collapse of a previous operator, the FT recounts.

"This option is very much on the table and will be selected if
the assessment I have set out determines that it offers a better
deal for passengers than the alternative."

Mr. Grayling had announced before Christmas that the franchise
would run out earlier than its due date of 2023 and would need
replacement by 2020 following lower-than-expected passenger
numbers on the East Coast route, the FT notes.

According to the FT, he said Stagecoach had "got its numbers
wrong" and had overbid for the route, adding that the franchise
had returned nearly GBP1 billion to the public purse but this had
cost Stagecoach losses of GBP200 million, equal to 20% of its
market value.

Lord Adonis in 2009 nationalized the East Coast line, which had
been struggling under the then operator National Express: it was
not privatized again until Virgin-Stagecoach took over in 2015,
the FT relays.


EUROSAIL-UK 2007-6NC: S&P Hikes Class A3a Notes Rating From BB-
---------------------------------------------------------------
S&P Global Ratings raised to 'A- (sf)' from 'BB- (sf)' its rating
on Eurosail-UK 2007-6NC PLC's class A3a notes. S&P has also
affirmed its 'AAA (sf)' credit rating on the class A2a
notes.

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

Since S&P's previous review, 90+ days delinquencies, which
exclude other amounts owed, decreased to 17.4% from 21.2%. Severe
delinquencies in this transaction are higher than in S&P's U.K.
nonconforming residential mortgage-backed securities (RMBS)
index. Based on the transaction's performance and the economic
environment, S&P has not projected additional arrears over the
next year in its analysis.

The servicer, Acenden Ltd., reports arrears to include amounts
outstanding, delinquencies, and other amounts owed. The
servicer's definition of other amounts owed includes (among other
items) arrears of fees, charges, costs, ground rent, and
insurance. Delinquencies include principal and interest arrears
on the mortgages, based on the borrowers' monthly installments.
Amounts outstanding are principal and interest arrears, after the
servicer first allocates borrower payments to other amounts owed.

In this transaction, the servicer first allocates any arrears
payments to other amounts owed, then to interest amounts, and
subsequently to principal. From a borrower's perspective, the
servicer first allocates any arrears payments to interest and
principal amounts, and then to other amounts owed. This
difference in the servicer's allocation of payments for the
transaction and the borrower results in amounts outstanding being
greater than
delinquencies.

S&P has refined its analysis of these other amounts owed by using
the available reported loan-level data. The new approach results
in a decrease in both the weighted-average foreclosure frequency
(WAFF) and the weighted-average loss severity (WALS) in this
transaction.

Rating         WAFF (%)         WALS (%)
AAA               40.19            40.63
AA                35.31            33.06
A                 29.88            20.55
BBB               25.55            13.76
BB                21.04             9.34
B                 18.83             6.05

The transaction is currently paying sequentially and the reserve
fund is not amortizing. S&P has considered this in its cash flow
analysis.

Following its review, S&P's analysis indicates that the available
credit enhancement for the class A2a notes is commensurate with
the currently assigned rating. S&P has therefore affirmed its
'AAA (sf)' rating on this class of notes.

S&P's analysis also indicates that the available credit
enhancement for the class A3a notes is commensurate with a higher
rating than currently assigned. S&P has therefore raised to 'A-
(sf)' from 'BB- (sf)' rating on this class of notes.

S&P's credit stability analysis indicates that the maximum
projected deterioration that S&P would expect at each rating
level over one- and three-year periods, under moderate stress
conditions, is in line with its credit stability criteria.

Eurosail-UK 2007-6NP securitizes U.K. nonconforming residential
mortgages originated by Southern Pacific Mortgages Ltd.,
Preferred Mortgages Ltd., London Mortgage Company, and Alliance &
Leicester PLC.

RATINGS LIST

Eurosail-UK 2007-6NC PLC
GBP288.962 Million Mortgage-Backed Floating-Rate Notes

Class            Rating
          To                 From

Rating Raised

A3a       A- (sf)            BB- (sf)

Rating Affirmed

A2a       AAA (sf)


GREAT HALL 2007-01: S&P Hikes Class Ea Notes Rating to BB
---------------------------------------------------------
S&P Global Ratings raised its credit ratings on Great Hall
Mortgages No. 1 PLC series 2007-01's class Da, Db, and Ea notes.
At the same time, S&P has affirmed its 'A (sf)' ratings on
the class A2a, A2b, Ba, Bb, Ca, and Cb notes.

The transaction is a U.K. residential mortgage-backed securities
(RMBS) transaction that securitizes buy-to-let and nonconforming
mortgages originated by Platform Funding Ltd.

The rating actions follow S&P's credit and cash flow analysis of
the most recent transaction information that S&P has received.
Collateral performance has continued to improve since total
delinquencies peaked in the first quarter of 2009. The reserve
fund is fully funded and credit enhancement is increasing
as the transaction is paying principal sequentially. Furthermore,
the transaction has been paying sequentially following the
cumulative loss trigger breach.

The current maximum potential rating in this transaction is 'A',
S&P' slong-term issuer credit rating on Danske Bank A/S, acting
as the guaranteed investment contract provider, as S&P does not
view the replacement framework for this agreement to be in line
with its current counterparty criteria.

According to the December 2017 investor report, total
delinquencies of greater than one month were 6.67%, down from
their March 2009 peak of 17.79%. Seasoning is currently at 120
months, and so S&P gives seasoning credit to all of the loans
that are not in arrears in S&P's analysis.

S&P's weighted-average foreclosure frequency (WAFF), weighted-
average loss severity (WALS) assumptions, and expected credit
coverage (CC) levels are shown in the table.

Rating level    WAFF (%)     WALS (%)     CC (%)
AAA                31.66        46.15      14.61
AA                 23.77        37.86       9.00
A                  18.57        23.57       4.38
BBB                13.85        15.27       2.11
BB                  9.03        10.02       0.90
B                   7.28         6.66       0.48

WAFF--Weighted-average foreclosure frequency.
WALS--Weighted-average loss severity.
CC--Credit coverage.

S&P said, "We have raised our ratings on the class Da, Db, and Ea
notes based on our overall lower expected credit coverage,
increases in available credit enhancement, and our cash flow
results. We have affirmed our 'A (sf)' ratings on the class A2a,
A2b, Ba, Bb, Ca, and Cb notes as the available credit enhancement
is commensurate with the currently assigned ratings."

RATINGS LIST

Class             Rating
            To              From

Great Hall Mortgages No. 1 PLC
EUR646.9 Million, GBP413.6 Million Mortgage-Backed Floating-Rate
Notes Series 2007-1

Ratings Raised

Da          BBB+ (sf)       BB+ (sf)
Db          BBB+ (sf)       BB+ (sf)
Ea          BB (sf)         B (sf)

Ratings Affirmed

A2a         A (sf)
A2b         A (sf)
Ba          A (sf)
Bb          A (sf)
Ca          A (sf)
Cb          A (sf)


LADBROKERS CORAL: S&P Affirms BB CCR After Sale to GVC Holdings
---------------------------------------------------------------
On Dec. 22, 2017, the board of directors of GVC Holdings and
Ladbrokes Coral Group announced that they had reached an
agreement for GVC to acquire Ladbrokes Coral for GBP3.2 billion
(excluding contingent value rights), to be funded by a
combination of cash and GVC shares. S&P Global Ratings believe
that, after the acquisition, Ladbrokes Coral will be a part of an
enlarged gaming company that is able to better withstand the
risks deriving from expected regulatory changes, due to its
larger scale and product diversity, than Ladbrokes Coral on a
stand-alone basis.

S&P Global Ratings is thus affirming its 'BB' long-term corporate
credit rating on U.K.-based sports betting and gaming operator
Ladbrokes Coral Group PLC and removed the rating from CreditWatch
with negative implications, where it was placed on Nov. 3,
2017. The outlook is positive.

S&P said, "At the same time, we affirmed and removed from
CreditWatch negative our 'BB' issue rating on the company's
GBP400 million senior unsecured notes due 2023 and GBP100 million
unsecured retail bond due 2022."

The affirmation follows the announcement on Dec. 22, 2017, that
GVC Holdings and Ladbrokes Coral Group have reached an agreement
for GVC to acquire Ladbrokes Coral. The deal will comprise a cash
offer of 32.7 pence in cash for each Ladbrokes Coral share, a
0.141 new GVC share offer, and a contingent value right (CVR)
linked to the outcome of the current triennial review (that
is, the U.K. government's review of gaming machines and social
responsibility measures). Overall, therefore, the initial
consideration values Ladbrokes Coral's equity at GBP4.0 billion,
assuming the maximum CVR payment (42.8 pence per Ladbrokes Coral
share) or GBP3.2 billion assuming no CVR payment (0.0 pence
per Ladbrokes Coral share). S&P expects the transaction to close
by the end of the first quarter or early in the second quarter of
2018.

The combined entity will be significantly bigger, positioning it
as the largest gaming company in Europe with revenues of about
GBP3 billion. S&P said, "We expect the merged entity to benefit
from a more diversified product mix and broader geographical
diversification, which will help enhance the group's capacity to
weather the potential detrimental effects of future regulatory
events. GVC's geographical diversification allows the group to be
less exposed to one market, in particular the U.K. market, which
could suffer material changes following the triennial review. In
addition, in contrast with our previous assumption regarding the
effect that the triennial review could have on the ratings on
Ladbrokes Coral, we now believe that the effect could be somewhat
mitigated by the CVR mechanism, which may partially compensate
for the loss of earnings through a reduction in debt."

S&P related, "Our assessment of the combined group also takes
into account the significant synergy opportunities, especially in
the technological and data space, given that GVC's proprietary
platform could enhance the group's operating efficiency. We do
not factor any of the potential synergies into our base case,
since we assess that in the short term, these may be more than
offset by integration- and transaction-related costs. Overall, we
consider that GVC and Ladbrokes Coral have complimentary business
models, with a strong presence in both digital- and retail-based
gaming, but we recognize that integration risks remain
significant given the magnitude of the transaction. GVC's
exposure to unregulated markets, lack of license exclusivity, and
ongoing evolution in online gaming regulation are also key risks,
which weigh on our overall assessment of the combined entity's
business risk profile.

"We expect the enlarged group's financial risk profile to weaken
on the conclusion of this acquisition, as we calculate the
group's adjusted debt to EBITDA to be about 3.5x-4.5x. We expect
the deterioration of the credit metrics to be more pronounced in
financial year 2019 (ending Dec. 31), when we anticipate
Ladbrokes Coral's operations will be most affected by the
reduction of maximum stakes on fixed-odds betting terminals, as
part of the triennial review results. Our financial forecasts
also include the effect on GVC of EUR200 million provision toward
the Greek tax authority's audit regarding the tax periods 2010
and 2011."

The above adjusted debt to EBITDA range indicates the likely
outcomes that could arise from the different scenarios of the
triennial review, combined with the effect of additional debt
incurred to fund this acquisition.

The positive outlook reflects a one-in-three possibility that S&P
could raise its ratings on Ladbrokes Coral in the next 12 months
following the merger if the enlarged group's leverage were
maintained well below an S&P Global Ratings-adjusted debt to
EBITDA ratio of 4.0x, even after the effect of the triennial
review.

S&P added, "We could raise our ratings on Ladbrokes Coral once
the triennial results are published and we have gained more
visibility on whether the combined group will be able to reach
total leverage well below an adjusted debt-to-EBITDA ratio of
4.0x. If financial policy and leverage were in line with this
assumption, all else being equal, we anticipate a maximum one-
notch upgrade after assessing the merged entity's future business
prospects, strategy, and free operating cash flow generation.

"If the merger were not completed for any reason, we could affirm
the rating on Ladbrokes Coral or place it on CreditWatch with
negative implications. In that case, we would reassess our view
on the potential effect that the triennial review results could
have on Ladbrokes Coral, based on the scenario chosen by the
government, and about the company's ability to mitigate the
effect of the reduction in stakes. Mitigating steps could include
widespread shop closures, a reduction of variable costs, and
cutting personnel costs, which would help keep credit measures in
line with our expectations for the current rating level. A rating
affirmation would depend on at least adequate liquidity and
enough headroom under the covenants of its debt facilities."


WORLDPAY FINANCE: Moody's Affirms Ba2 Senior Unsec. Notes Rating
----------------------------------------------------------------
Moody's Investors Service affirmed all of Vantiv, LLC's
("Vantiv") ratings, including the Ba2 corporate family rating,
and the Ba2 rating on Worldpay Finance plc's senior unsecured
notes due 2022 ("2022 Notes") following the completion of the
acquisition of Worldpay Group plc ("Legacy Worldpay") for about
$12 billion in enterprise value. The rating outlook is stable.

RATINGS RATIONALE

The Ba2 CFR considers Vantiv's significant size in its markets
and strong position as both a merchant acquirer and a card
issuing processor for financial institutions. The merger brings
significant strategic benefits as it strengthens Vantiv's
business profile by providing enhanced scale and international
diversity. Legacy Worldpay adds a large and rapidly growing e-
commerce business and reduces Vantiv's reliance on its
traditional card-processing business at large US retailers.

While Vantiv's adjusted debt to EBITDA is initially high at over
5x times without reflecting any synergies upon acquisition close,
Moody's expects leverage to improve to 4 times by the end of
2019. This is consistent with management's public commitment to
reduce reported leverage to 4.0x debt to EBITDA leverage ratio
over 12-18 months following the close as well as the company's
prior track record of reducing leverage through a combination of
debt repayment and accelerated profit growth. The de-leveraging
will be supported by the substantial free cash flow of the
combined entity which should exceed $800 million on an annual
basis. In addition, Moody's expects that Vantiv will generate
high-single digit adjusted annual profit growth aided by about
$200 million of projected run-rate cost synergies, which are
expected to be realized over a 3 year period after the close of
the acquisition.

The ratings for the debt instruments reflect both the probability
of default of Vantiv reflected in the Ba2-PD PDR, and the loss
given default assessment of the individual debt instruments. The
secured credit facilities of Vantiv are rated Ba2 and are secured
on a first lien basis by substantially all tangible and
intangible assets of Vantiv's domestic subsidiaries. Both the
senior secured debt and Vantiv's unsecured notes are guaranteed
by Vantiv Holding, LLC (a holding company of Vantiv) and Vantiv's
material domestic subsidiaries. The B1 rating on Vantiv's
unsecured notes reflect effective subordination to a significant
amount of secured debt.

Worldpay Finance plc's senior unsecured notes due 2022 are rated
Ba2, equivalent to the rating of the secured debt at Vantiv,
given the priority position of the notes relative to the Legacy
Worldpay assets and Moody's expectation that Legacy Worldpay will
continue to maintain low leverage. While certain Legacy Worldpay
subsidiary guarantees were released from the 2022 Notes following
the repayment of the credit facilities upon closing of the
merger, the parent guarantee from Worldpay Group Ltd (formerly
Worldpay Group plc), which is the primary operating entity that
accounts for the majority of the assets and EBITDA of the
consolidated Legacy Worldpay, remains intact.

The stable outlook reflects Moody's expectation that Vantiv will
generate at least mid-single digit organic annual revenue and
profit growth. Operating performance will likely be supported by
a growing U.S. and European economy, an expanding sales network
and merchant base, and the rapid growth of integrated payment
solutions.

The ratings could be upgraded if Vantiv increases market share
through organic revenue growth without pressuring operating
margins and Moody's expects debt to EBITDA to be sustained in the
low 3x range. The ratings could be downgraded if Moody's expects
declines in revenue and profits, increased customer churn, poor
execution, or heightened competition. In addition, negative
rating pressure could arise if it becomes apparent that Vantiv's
financial leverage will remain in excess of 4.5x on Moody's basis
beyond 18 months after the close of the acquisition.

Outlook Actions:

Issuer: Vantiv, LLC

-- Outlook, Remains Stable

Issuer: Worldpay Finance plc

-- Outlook, Remains Stable

Issuer: Worldpay Group Limited

-- Outlook, Changed To Rating Withdrawn From Stable

Affirmations:

Issuer: Vantiv, LLC

-- Probability of Default Rating, Affirmed Ba2-PD

-- Speculative Grade Liquidity Rating, Affirmed SGL-1

-- Corporate Family Rating, Affirmed Ba2

-- Senior Secured Bank Credit Facility, Affirmed Ba2 (LGD 3)

-- Senior Unsecured Regular Bond/Debenture, Affirmed B1 (LGD 6)

Issuer: Worldpay Finance plc

-- Senior Unsecured Regular Bond/Debenture, Affirmed Ba2 (LGD 3
    from LGD 4)

Withdrawals:

Issuer: Worldpay Group Limited

-- Probability of Default Rating, Withdrawn , previously rated
    Ba2-PD

-- Corporate Family Rating, Withdrawn , previously rated Ba2

The principal methodology used in these ratings was Business and
Consumer Service Industry published in October 2016.

Vantiv is an international payment solutions provider servicing
financial institutions' and retailers' credit card, debit card,
merchant and private label programs.

Vantiv's indirect parent Worldpay, Inc. is a NYSE listed company
with projected annual revenues of over $3.5 billion.


OYSTER YACHTS: Goes Into Liquidation, 160 Staff Lose Jobs
---------------------------------------------------------
According to Yachting Monthly's Theo Stocker, Oyster Yachts, the
British luxury yacht builder, has gone into liquidation with all
staff laid off.

Staff were said to have found out that all employees were to be
made redundant in the news Feb. 5, Yachting Monthly relates.
According to Yachting Monthly, a spokesman for the company
confirmed that a statement would be made Feb. 6 but would not
confirm or comment on the news.

Oyster Yachts recently launched their new model, the Oyster 745
at boot Duesseldorf, the German Boat Show at the end of January,
Yachting Monthly discloses.

According to Yachting Monthly, sources have said that 160 staff
at the Southampton boatyard have been told they will be losing
their jobs.

HTP Investments, a Dutch investment firm, are rumored to have
withdrawn financial support for the company, Yachting Monthly
relays.

Industry sources suggested that the company may have lost money
in dealing with structural problems identified following the
sinking of the Oyster yacht Polina Star III, which lost her keel
and sank off the coast of Spain in 2015, Yachting Monthly states.



                            *********

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
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.


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