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        T R O U B L E D   C O M P A N Y   R E P O R T E R

                           E U R O P E

          Friday, February 9, 2018, Vol. 19, No. 029


                            Headlines


A Z E R B A I J A N

AZERBAIJAN: Fitch Alters Outlook to Stable, Affirms BB+ IDRs


G E R M A N Y

AAREAL BANK: Fitch Affirms BB- Addt'l Tier 1 Securities Rating


G R E E C E

ICE COLD: S&P Raises CCR to 'B-' on Completed Restructuring


I R E L A N D

OZLME III: Moody's Assigns B2(sf) Rating to Class F Sr. Notes


I T A L Y

PARMALAT SPA: Milan Court Tosses EUR1.8MM Claim v. Citigroup
PRO-GEST SPA: S&P Assigns 'BB-' LT Corporate Credit Rating
UBI BANCA: Fitch Affirms BB+ Subordinated Debt Rating


M A C E D O N I A

MACEDONIA: Fitch Revises Outlook to Positive, Affirms BB IDR

P O L A N D

I3D SA: Files Motion for Bankruptcy in Gliwice Court


R U S S I A

PARTNERCAPITALBANK JSC: Put on Provisional Administration
RUSHYDRO CAPITAL: Fitch Rates Rouble-Denominated Notes 'BB+(EXP)'
SECOND GENERATING: Fitch Raises Long-Term FC IDR to 'BB+'
SIBERIAN BANK: Put on Provisional Administration, License Revoked


S P A I N

TDA IBERCAJA 3: S&P Raises Class C Notes Rating to BB (sf)
TDA IBERCAJA 4: S&P Raises Class E Notes Rating to BB (sf)


S W E D E N

ITIVITI GROUP: S&P Assigns Prelim 'B' CCR on Ullink Acquisition


U N I T E D   K I N G D O M

AVANTI COMMUNICATIONS: Moody's Withdraws Ca Corp. Family Rating
CARILLION PLC: J. Murphy & Sons Buys UK Power Framework Business
CARILLION PLC: UK Gov't Spent GBP150MM on Financing Liquidation
GRAINGER PLC: Fitch Raises Long-Term IDR to BB+, Outlook Stable
WORLDPAY GROUP: S&P Raises CCR to 'BB+' on Sale to Vantiv


X X X X X X X X

* BOOK REVIEW: The Rise and Fall of the Conglomerate Kings


                            *********



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A Z E R B A I J A N
===================


AZERBAIJAN: Fitch Alters Outlook to Stable, Affirms BB+ IDRs
------------------------------------------------------------
Fitch Ratings has revised the Outlook on Azerbaijan's Long-Term
Foreign- and Local-Currency Issuer Default Ratings (IDRs) to
Stable from Negative and affirmed the IDRs at 'BB+'.

KEY RATING DRIVERS
The revision of the Outlook on Azerbaijan's IDRs reflects the
following key rating drivers and their relative weights:

Medium
Macro-stability improved in 2017 after two years of turbulence.
In the context of gradually recovering oil prices and tight
monetary and fiscal policies, the exchange rate has been stable
since April 2017 at around 1.70 to the US dollar. This has in
turn helped ease pressure on inflation, which although at 12.9%
on average in 2017, has reduced on a month-on-month basis since
April 2017. Dollarisation of loans and deposits (40.6% and 72.1%,
respectively, at end-November 2017) is slowly declining, also
reflecting some improved confidence in the currency. Fitch
expects the currency to remain broadly unchanged over the coming
two years, based on stable oil price assumptions.

The clean-up of the banking sector has progressed. The
restructuring of the country's largest bank, International Bank
of Azerbaijan (IBA), which included a transaction considered by
Fitch to be a distressed debt exchange, involving state bond
issuances of USD2.3 billion and state guarantees on bad loan
transfers, has neared completion, with the capital position and
asset quality restored. The next steps will involve the closing
of a significant net open FX position and privatisation of the
bank. The rest of the banking sector remains very vulnerable, but
Fitch expects credit growth to start recovering in 2018 after a
dramatic fall over the past two years.

The country's external balance sheet, which is a key support to
the rating, has started to recover. Driven by higher oil prices,
the current account balance has turned to a surplus since 2Q17,
and Fitch estimates the surplus reached 3.1% for the full year.
As a result, FX reserves have risen by an estimated 22%; assets
in the State Oil Fund of Azerbaijan (Sofaz) have also increased
slightly to USD35.8 billion at end-2017 (2016: USD33.1 billion),
equivalent to 87.4% of 2017 GDP. Fitch expects Sofaz assets to
continue rising thanks to steady oil prices and expected
limitations of its transfers to the state under a new fiscal rule
in 2019.

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

External finances compare favourably with 'BB' peers, reflecting
the size of Sofaz assets relative to GDP, as well as the high
transparency of its accounts. Net sovereign foreign assets, at
80.7% of GDP at end-2017 are therefore much higher than the 'BB'
median of 0.4%. Despite the recent use of Sofaz assets to improve
macroeconomic stability, recent policy decisions, including the
IBA restructuring and the upcoming implementation of a fiscal
rule, reflect the authorities' intention to preserve its assets.

Adjustment of the economic policy framework is progressing
slowly, leaving doubts about the country's ability to absorb a
potential future commodity price shock. The exchange rate is
officially floating, but in Fitch's view its remarkable stability
since April 2017 likely illustrates central bank interventions
and FX market narrowness. Monetary policy remains constrained by
high dollarisation rates and unsophisticated policy tools, making
inflation targeting a medium-term objective. A fiscal rule is
planned to be introduced in 2019, which would reduce the
traditional pro-cyclicality of fiscal policy.

Fitch considers that public finances are a strength for the
rating, despite their recent deterioration. The 2017 consolidated
budget deficit was moderate at 1.5% of GDP (2016: 1.2%), due to
higher than expected oil revenues and contained current and
capital spending. Fitch expects the budget balance to return to
surplus from 2018 despite rising capital spending, thanks to
higher oil revenues.

Public debt only slightly increased in 2017 to 24.6% of GDP
(including IBA-related bond issuances worth 5.6% of GDP), much
below the 'BB' median of 47.4%. However, contingent liabilities
had grown to 29.3% of GDP at end-2017, largely reflecting state
guarantees on IBA bad loan transfers. As these take the form of
concessional 30-year bonds held by the central bank, losses are
likely to be very gradual and largely absorbed by the central
bank.

Macroeconomic performance lags 'BB' peers, reflecting
Azerbaijan's costlier economic adjustment to the oil price shock
compared with other CIS oil exporters and its lack of economic
diversification. Real GDP growth, at an average of 1.2% over the
past five years, compares unfavourably with the 'BB' median of
3.5%, while inflation has remained in double digits since 2016.
Volatility of GDP growth, inflation and the exchange rate all
compare unfavourably with peers. Given the expected rise in gas
exports upon completion of the Southern Gas Corridor project,
commodity dependence will remain particularly high. Prospects for
meaningful diversification of the economy, although on the
authorities' agenda through the 'strategic roadmaps' initiative,
appear remote.

GDP per capita on a PPP basis and human development indicators
are close to 'BB' medians, while governance indicators are very
weak, reflecting a long-standing centralisation of power. Fitch
does not anticipate any significant policy or governance
evolution after the October 2018 presidential elections.
Political risk associated with the unresolved conflict with
Armenia over Nagorno-Karabakh also remains material, even if
there has not been any major rise in tensions since April 2016.

SOVEREIGN RATING MODEL (SRM) and QUALITATIVE OVERLAY (QO)
Fitch's proprietary SRM assigns Azerbaijan a score equivalent to
a rating of 'BB-' on the Long-Term Foreign-Currency (LT FC) IDR
scale.

Fitch's sovereign rating committee adjusted the output from the
SRM to arrive at the final LT FC IDR by applying its QO, relative
to rated peers, as follows:
- External Finances: +2 notches, to reflect the size of Sofaz
assets, which underpin Azerbaijan's exceptionally strong foreign
currency liquidity position and the very large net external
creditor position of the country.

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

RATING SENSITIVITIES

The main factors that could, individually or collectively,
trigger negative rating action are:
- An erosion of the sovereign's net external assets.
- Developments in the economic policy framework that undermine
   macroeconomic stability.
- Weakening growth performance and prospects.

The main factors that could, individually or collectively,
trigger positive rating action are:
- Improvement in the macroeconomic policy framework,
   strengthening the country's ability to address external shocks
   and reducing macro volatility.
- An improvement in governance and the business environment and
   progress in economic diversification underpinning growth
   prospects.
- A significant rise in the sovereign's net external assets.

KEY ASSUMPTIONS

Fitch forecasts Brent Crude to average USD52.5/b in 2018 and
USD55/b in 2019.

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

The full list of rating actions is as follows:

Long-Term Foreign-Currency IDR affirmed at 'BB+'; Outlook revised
to Stable from Negative
Long-Term Local-Currency IDR affirmed at 'BB+'; Outlook revised
to Stable from Negative
Short-Term Foreign-Currency IDR affirmed at 'B'
Short-Term Local-Currency IDR affirmed at 'B'
Country Ceiling affirmed at 'BB+'
Issue ratings on long-term senior unsecured foreign-currency
bonds affirmed at 'BB+'
Issue ratings on long-term senior unsecured local-currency bonds
affirmed at 'BB+'
Issue ratings on short-term senior unsecured local-currency bonds
affirmed at 'B'
Issue ratings on short-term senior unsecured foreign-currency
bonds affirmed at 'B'


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G E R M A N Y
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AAREAL BANK: Fitch Affirms BB- Addt'l Tier 1 Securities Rating
--------------------------------------------------------------
Fitch Ratings has affirmed Aareal Bank AG's Long-Term Issuer
Default Rating (IDR) at 'BBB+' with a Stable Outlook and
Viability Rating (VR) at 'bbb+.

KEY RATING DRIVERS
IDRs, VR, AND SENIOR DEBT RATINGS

Aareal's IDRs, VR and the ratings for what Fitch views as non-
preferred senior unsecured debt primarily reflect the bank's
company profile as a commercial real estate (CRE) lender, which
exposes its operations to the inherently cyclical CRE sector.
This concentration is mitigated by the bank's resilient
performance and strengthened capitalisation.

Fitch view management's public commitment to maintaining
comfortable capital buffers as realistic in light of Aareal's
robust record of internal capital generation. The bank's fully-
loaded common equity Tier 1 (CET1) ratio increased to a strong
17.3% at end-3Q17 from 15.7% at end-2016. This predominantly
resulted from a reduction in risk-weighted assets in 9M17, driven
by maturing non-core assets, increased loan syndication and
material loan prepayments as well as lower risk density resulting
from lower loss given defaults. Consequently, Aareal's core loan
portfolio is now at the lower end of the bank's targeted range of
EUR25 billion-EUR28 billion.

Concurrently, the fully-loaded total capital ratio increased to
25.9%, which comfortably exceeds Aareal's 2017 transitional SREP
(Supervisory Review and Evaluation Process) requirement of 11%,
including buffers. Continuing reduction of non-core assets and
more active use of loan syndication should allow the bank to
maintain solid capitalisation in the medium term despite its
shift to a higher dividend pay-out policy.

Material deterioration of the overall benign international CRE
markets seems unlikely in the short term. Aareal is only
moderately exposed to pockets of risks that are gradually
building up in the German CRE market as a result of low interest
rates and intense competition. Non-performing loans (NPLs) peaked
in the bank's weak Italian CRE loan book in 2015 and have since
dropped 9% to EUR764 million at end-3Q17. Fitch do not expect any
material improvement from ongoing restructuring measures on this
portfolio in the short-term.

Aareal's operating performance has been fairly stable over the
current credit cycle despite the bank's concentration on the
structurally cyclical CRE market, and Fitch expect it to remain
sound in 2018. Aareal's performance benefits from the bank's
diversification by geography and property type, which mitigates
the continuous margin erosion in new domestic lending since 2013.
Fitch expect pressure on CRE lenders' profitability to increase
in the medium term due to intense competition, margin pressure
and upward normalisation of risk charges from (except for Italy)
currently low levels.

Due to its concentration on real estate lending and intensive use
of internal rating models, Aareal will be affected by the
introduction of the Basel III output floor, which was decided by
global regulators in 4Q17 and will reduce the benefit of internal
rating models on risk-weighted asset (RWA) calculation. However,
this should be manageable in light of the slow phasing-in of the
new rules and Aareal's strong capitalisation with a 6% regulatory
leverage ratio at end-3Q17.

Aareal's solid funding mix consists of Pfandbriefe, unsecured
private placements including Schuldscheine and a large, growing
and resilient institutional housing deposit base. The latter is a
key competitive advantage as it results in low reliance on
unsecured market funding and should create a substantial funding
cost advantage when interest rates increase.

Fitch has not given any uplift to Aareal's Long-Term IDR relative
to the bank's VR despite significant layers of subordinated debt.
This is because the Long-Term IDR would not achieve a higher
level than the current 'BBB+' if Aareal's junior debt buffer was
in the form of Fitch Core Capital (FCC) rather than debt. This is
primarily driven by Fitch view that Aareal's company profile, as
a largely wholesale-funded monoline CRE lender, constrains the
bank's VR.

SUPPORT RATING AND SUPPORT RATING FLOOR

Aareal's Support Rating (SR) and Support Rating Floor (SRF)
reflect Fitch view that, following the implementation of
legislation and resolution tools pursuant to the EU's Bank
Recovery and Resolution Directive (BRRD) in Germany in 2015,
senior creditors can no longer rely on receiving full
extraordinary support from the sovereign, should Aareal become
non-viable.

SUBORDINATED DEBT AND OTHER HYBRID SECURITIES

Aareal's Tier 2 notes are notched down once from the VR to
reflect their higher loss severity relative to senior debt.

The legacy, non-Basel III compliant hybrid securities issued by
Capital Funding GmbH are notched down four times from Aareal's VR
(two notches for high loss severity risk and two notches for high
non-performance risk relative to that captured in the VR). The
bank's large distributable reserves significantly mitigate the
non-performance risk arising from the instruments' distributable
profit trigger.

Aareal's Basel III-compliant additional Tier 1 (AT1) hybrid
securities are rated five notches below the VR, twice for loss
severity to reflect their write-down on breach of their 7%
trigger, and three times for non-performance risk to reflect
fully discretional coupon payments.

DERIVATIVE COUNTERPARTY, DEPOSIT AND PREFERRED SENIOR DEBT
RATINGS

The Derivative Counterparty Rating (DCR), Long-Term Deposit
Rating and preferred long-term senior debt rating are all one
notch above the Long-Term IDR. This reflects Fitch view that
Aareal's combined buffers of qualifying junior and vanilla senior
debt are sufficient to recapitalise the bank, restore its
viability and prevent default on preferred senior liabilities
upon resolution. The four rated preferred senior debt instruments
(DE000A12T762, XS0196076318, DE000A12T705, DE000A1RE4C7) contain
features that allow them to rank senior to (and, consequently,
make them less vulnerable to default than) vanilla senior
unsecured debt in resolution and in insolvency.

The Short-Term Deposit Rating is aligned with the Short-Term IDR,
which is the lower of the two options available at an 'A-' level.
This is because of high uncertainty regarding the bank's likely
balance sheet composition upon default and how a resolution
scenario would affect short-term depositors in Germany, given the
lack of precedent for favouring short-term creditors.

RATING SENSITIVITIES
IDRs, VR, AND VANILLA SENIOR DEBT RATINGS

Aareal's IDRs and the ratings of what Fitch views as non-
preferred senior unsecured debt are sensitive to the same drivers
as the bank's VR. Over the medium term, the VR will remain
primarily vulnerable to asset quality deterioration. An upgrade
of the VR could result from a material diversification of the
bank's business model into lower-risk asset classes or
uncorrelated sources of revenue, such as further growth of the
bank's consulting and services division.

SR AND SRF
An upgrade of Aareal's SR and an upward revision of its SRF would
require a higher propensity of sovereign support. While not
impossible, the BRRD makes this highly unlikely, in Fitch view.

SUBORDINATED DEBT AND OTHER HYBRID SECURITIES

The ratings of Aareal's Tier 2 notes and hybrid instruments are
primarily sensitive to changes to the VR. The ratings are also
sensitive to a change in their notching.

DCR, DEPOSIT RATINGS AND PREFERRED SENIOR DEBT

Aareal's DCR, Deposit Ratings and preferred long-term senior debt
rating are primarily sensitive to changes in the Long-Term IDR.
They are also sensitive to the development of the subordinated
and vanilla senior debt buffers relative to the recapitalisation
amount likely to be needed to restore viability and prevent
default on more senior derivative obligations, deposits and
structured notes.

The rating actions are as follows:

Aareal Bank AG:
Long-Term IDR: affirmed at 'BBB+'; Outlook Stable
Short-Term IDR: affirmed at 'F2'
Viability Rating: affirmed at 'bbb+'
Support Rating: affirmed at '5'
Support Rating Floor: affirmed at 'No Floor'
Derivative Counterparty Rating: affirmed at 'A-(dcr)'
Deposit Ratings: affirmed at 'A-'/'F2'
Debt issuance programme: affirmed at 'BBB+'/'F2'
Senior unsecured notes: affirmed at 'BBB+'
Preferred senior unsecured debt: affirmed at 'A-'/'F2'
(DE000A12T762, XS0196076318, DE000A12T705, DE000A1RE4C7)
Subordinated debt: affirmed at 'BBB'
Additional Tier 1 securities (DE000A1TNDK2): affirmed at 'BB-'
Capital Funding GmbH's debt (DE0007070088): affirmed at 'BB'


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


ICE COLD: S&P Raises CCR to 'B-' on Completed Restructuring
-----------------------------------------------------------
S&P Global Ratings raised to 'B-' from 'SD' (selective default)
its long-term corporate credit rating on Greece-based Ice Cold
Merchandiser (ICM) and glass packaging manufacturer Frigoglass
SAIC. The outlook is negative.

S&P said, "At the same time, we assigned our 'B-' issue rating to
the EUR79.4 million first-lien senior secured notes due 2021, and
our 'CCC+' issue rating to EUR98.5 million second-lien secured
notes due 2022, issued by Frigoglass Finance B.V. (the group's
financial subsidiary)."

The upgrade reflects the completion of Frigoglass' capital
restructuring process. Following the distressed exchange offer
with lenders, the company has significantly reduced its debt
amount and associated interest costs, extended the debt maturity
profile to 2021-2022, and obtained additional liquidity for EUR70
million (EUR30 million via a fresh equity injection from major
shareholder, Boval SA, plus EUR40 million as new debt from core
banks and noteholders). The closing of the capital restructuring
represents a key milestone for the group. S&P now focuses on the
new conventional group's default risk to assess the corporate
credit rating.

Frigoglass is one of global leaders in the Ice Cold Merchandisers
(ICM) market (about 70% of sales in 2016), and the principal
supplier of glass packaging in the West Africa market. The main
markets for the group are Russia, Nigeria, and Europe, while
Coca-Cola bottlers represent the main clients (about 55% of total
group sales). For the full-year 2017, we expect the company to
reach EUR400 million-EUR410 million in sales, and about EUR50
million in reported EBITDA.

S&P said, "In our view, the group's business risk profile is
constrained by its high concentration on a few clients, such as
Coca-Cola bottlers (mainly Coca-Cola HBC and Coca-Cola European
Partners).

"The industry in which the company operates is also fairly
competitive on prices, and over the short-to-medium term we do
not expect the margins to increase significantly. Over the past
three-to-four years the company has posted lower-than-expected
operating results because of high volatility related to its large
exposures to emerging markets that have suffered economic
recession (such as Nigeria and Russia).

"We also take into account the effort the group needs to put in
to regain the trust of some of its clients and suppliers in the
wake of its previously stressed financial situation.

"Positively, we note that Frigoglass has long-term relationships
with some global beverage brands in soft drinks, breweries, and
others (such as Coca-Cola, Heineken, and SAB Millers).
Furthermore, the group has a leading market position in its niche
segment of beverage coolers, and its established manufacturing
footprint in West Africa gives Frigoglass some potential for
future long-term growth."

Within the ICM division, the company continues to invest in
technology to provide best-in-class energy consumption and
innovative smart coolers (such as ICOOL and its Hybrid coolers
product range). The group has also completed the rationalization
of its production footprint through the discontinuation of
manufacturing in U.S. and more recently in China. These actions
will bring some efficiencies and cost savings over the next few
years.

Frigoglass' new business strategy aims to better penetrate the
standard-to-low ICM market segment to achieve greater diversity
in its customer base. Additionally, Frigoglass is expanding the
"integrated services" business--focusing on Europe and then
gradually rolling out to other markets--to support revenue growth
in the ICM division. At the same time, the company is simplifying
its production base via a reduction in stock keeping units
(SKUs), and the outsourcing of specific manufacturing activities.
In the glass division, the company needs to finalize the
turnaround of its Middle East division, and to significantly
invest in new equipment and repairs.

S&P said, "We expect Frigoglass to report an EBITDA margin of
11%-12% over the next 18-24 months. However, profit volatility
could be hampered by raw material price trends and currency
volatility. Nonetheless, we expect Frigoglass will start to post
a more stable trend in margins.

"Our assessment of the group's financial risk profile reflects
our estimate of its S&P Global Ratings-adjusted debt to EBITDA
staying at around 5.5x over the next 12-18 months. Under our base
case, we forecast a very gradual deleveraging trend, mainly owing
to moderate strengthening in absolute EBITDA value.

"At the same time, we expect the company to continue to post
negative free operating cash flow (FOCF; after working capital
requirements and capital investments) over the next 12-18 months,
mainly affected by annual capital expenditure (capex). Frigoglass
plans to invest significant capex to support the expected volume
growth (including for new product developments, equipment in
Russia and Romania, expansion in service segment) and to recover
the cut in capex in 2016-2017 that related to the group's
stressed financial situation."

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

-- About mid-single-digit revenue growth for fiscal year 2018
    and 2019 mainly supported by a relatively low comparison
    base, recovery in volume (both for coolers and glass
    products), and some regain in market share with other non-
    Coca-Cola customers (such as breweries).

-- Relatively stable EBITDA margin of 11%-12%, assuming positive
    effects from manufacturing rationalization and other
    operating cost saving initiatives. This will be offset by
    price reductions for selected customers and a less favorable
    product mix (with a higher contribution from the standard-to-
    low segment in the ICM division).

-- Total annual capex of about EUR30 million in 2018 and EUR25
    million in 2019.

-- No dividend payment and acquisitions.

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

-- Adjusted debt to EBITDA of around 5.5x over the next two
    years.

-- Negative annual FOCF generation of EUR10 million-EUR5 million
    over the next 18-24 months.

-- The negative outlook reflects the higher risk of volatility
    in Frigoglass' credit metrics associated with implementation
    risk around its business plan and currency volatility risk in
    emerging markets.

S&P said, "In our view, Frigoglass has limited headroom within
the current rating to withstand a deviation from our current base
case. Under our base-case scenario, for the full-year 2018 we
anticipate the company will generate reported EBITDA of around
EUR50 million, while posting negative FOCF due to higher capex to
finance future growth in emerging markets.

"We could lower the rating if Frigoglass does not deliver on its
business plan, resulting, for example, in FOCF in 2018 being more
negative than we currently assume, or if the company increases
its leverage ratio due to a significant debt-funded acquisition.
Furthermore, we could consider lowering the rating if the
company's liquidity comes under pressure, which could result from
high capital investments that are not reflected as growth in the
group's top line.

"We will likely revise the outlook to stable if the company
delivers on its business plan of improving operating performance
in revenues and EBITDA, and posting a negative FOCF of about
EUR10 million or better in 2018, while confirming our current
expectation of improving cash flow generation for 2019."


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OZLME III: Moody's Assigns B2(sf) Rating to Class F Sr. Notes
-------------------------------------------------------------
Moody's Investors Service has assigned definitive ratings to nine
classes of notes (the "Notes") issued by OZLME III Designated
Activity Company:

-- EUR2,000,000 Class X Senior Secured Floating Rate Notes due
    2030, Definitive Rating Assigned Aaa (sf)

-- EUR225,000,000 Class A-1 Senior Secured Floating Rate Notes
    due 2030, Definitive Rating Assigned Aaa (sf)

-- EUR10,000,000 Class A-2 Senior Secured Fixed Rate Notes due
    2030, Definitive Rating Assigned Aaa (sf)

-- EUR35,500,000 Class B-1 Senior Secured Floating Rate Notes
    due 2030, Definitive Rating Assigned Aa2 (sf)

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

-- EUR26,500,000 Class C Senior Secured Deferrable Floating Rate
    Notes due 2030, Definitive Rating Assigned A2 (sf)

-- EUR21,000,000 Class D Senior Secured Deferrable Floating Rate
    Notes due 2030, Definitive Rating Assigned Baa2 (sf)

-- EUR22,000,000 Class E Senior Secured Deferrable Floating Rate
    Notes due 2030, Definitive Rating Assigned Ba2 (sf)

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

RATINGS RATIONALE

Moody's rating of the Notes addresses the expected loss posed to
noteholders. The rating reflects the risks due to defaults on the
underlying portfolio of assets, the transaction's legal
structure, and the characteristics of the underlying assets.

OZLME III is a managed cash flow CLO. The issued notes are
collateralized primarily by broadly syndicated first lien senior
secured corporate loans. At least 90% of the portfolio must
consist of senior secured loans, senior secured bonds and
eligible investments, and up to 10% of the portfolio may consist
of second lien loans, unsecured loans, mezzanine obligations and
high yield bonds.

Och-Ziff Europe Loan Management Limited (the "Manager") manages
the CLO. It directs the selection, acquisition, and disposition
of collateral on behalf of the Issuer. After the reinvestment
period, which ends in February 2022 the Manager may reinvest
unscheduled principal payments and proceeds from sales of credit
risk and credit improved obligations, subject to certain
restrictions.

In addition to the nine classes of notes rated by Moody's, the
Issuer will issue EUR39.9m of Subordinated Notes which will not
be rated.

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

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:

Performing par and principal proceeds balance: EUR400,000,000

Diversity Score: 40

Weighted Average Rating Factor (WARF): 2740

Weighted Average Spread (WAS): 3.65%

Weighted Average Recovery Rate (WARR): 42.0%

Weighted Average Life (WAL): 8.5 years

Stress Scenarios:

Together with the set of modeling assumptions above, Moody's
conducted an additional sensitivity analysis, which was a
component in determining the rating assigned to the rated Notes.
This sensitivity analysis includes increased default probability
relative to the base case.

Below is a summary of the impact of an increase in default
probability (expressed in terms of WARF level) on 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 2740 to 3151)

Rating Impact in Rating Notches

Class X Senior Secured Floating Rate Notes: 0

Class A-1 Senior Secured Floating Rate Notes: 0

Class A-2 Senior Secured Fixed Rate Notes: 0

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

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

Class C Senior Secured Deferrable Floating Rate Notes: -2

Class D Senior Secured Deferrable Floating Rate Notes: -2

Class E Senior Secured Deferrable Floating Rate Notes: 0

Class F Senior Secured Deferrable Floating Rate Notes: 0

Percentage Change in WARF -- increase of 30% (from 2740 to 3562)

Rating Impact in Rating Notches

Class X Senior Secured Floating Rate Notes: 0

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

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

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

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

Class C Senior Secured Deferrable Floating Rate Notes: -4

Class D Senior Secured Deferrable Floating Rate Notes: -3

Class E Senior Secured Deferrable Floating Rate Notes: -1

Class F Senior Secured Deferrable Floating Rate Notes: -1


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


PARMALAT SPA: Milan Court Tosses EUR1.8MM Claim v. Citigroup
------------------------------------------------------------
Reuters reports that Citigroup said on Feb. 7 a Milan court has
thrown out a request by Italy's Parmalat for EUR1.8 billion
(US$2.2 billion) in compensation from Citi in a case relating to
the diary group's collapse in 2003.

"The Court of Milan has granted Citigroup's motion to dismiss in
its entirety a civil claim for EUR1.8 billion that was initiated
against Citi (and a number of its former employees) by Italian
diary group Parmalat in June 2015," Reuters quotes the U.S. bank
as saying.

Citigroup said the court had held that the claim duplicated one
that had been brought in 2008 by a court in New Jersey which had
been dismissed as unmeritorious, Reuters relates.

According to Reuters, Parmalat said in a statement it considered
the Milan court's decision "mistaken and unfair", adding it would
appeal.


PRO-GEST SPA: S&P Assigns 'BB-' LT Corporate Credit Rating
----------------------------------------------------------
S&P Global Ratings assigned its 'BB-' long-term corporate credit
rating to Italy-based Pro-Gest SpA. The outlook is stable.

S&P said, "We also assigned our 'BB-' issue rating and '4'
recovery rating to the EUR250 million 3.25% senior unsecured
notes due 2024. The recovery rating indicates our expectation of
average (30%-50%; rounded estimate 40%) recovery of principal in
the event of payment default.

"The ratings are in line with the preliminary ratings we assigned
on Dec. 1, 2017.

"Our long-term rating on Pro-Gest primarily reflects its leading
position in Italy as a provider of containerboards, corrugated
boards, and packaging solutions."

The rating is based on the new capital structure, following the
recent note issuance and partial refinancing of existing debt
facilities.

Pro-Gest's business risk profile is underpinned by its leading
niche position, technological know-how, cost leadership, strong
EBITDA margins, manufacturing footprint, and long-standing
customer relations.

In Italy, the company is the market leader in recycled
containerboards (23% market share) and the third-largest provider
of corrugated cardboards and packaging (14% market share). Key
competitors include Smurfit Kappa and DS Smith, as well as
smaller, local players. The company relies heavily on the Italian
market, where it generates around 90% of sales and where its 19
manufacturing plants are based.

Pro-Gest has strong and long-standing customer relations and a
diversified customer base; the top-10 customers account for 17%
of sales. Despite containerboards being standardized, the market
favors local players because the bulky nature of the items leads
to high transportation costs.

Compared with other European markets, the Italian market is
undersupplied. Pro-Gest is therefore expanding its containerboard
capacity by 450 kilotonnes (kt) by converting a former newspaper
plant into a highly efficient containerboard mill in Mantova.
There, production of lightweight (70-160 grams per square meter)
containerboards is expected to start in the second half of 2018.
S&P said, "We also expect the new plant to deliver significant
cost savings. The company has so far only received a permit to
produce 200kt. Authorization for a further 200kt has been delayed
by two years and is still pending following protests by local
residents. Although delays or failure to receive the pending
authorization would result in lower operating efficiencies and a
longer investment payback period, it would not affect our
forecasts, which only assume the approved 200kt capacity
increase."

Overall, 40% of Pro-Gest's containerboards and 77% of its
corrugated cardboards are sold to third parties, mostly other
corrugated cardboard and packaging producers. The packaging
segment is exposed to relatively stable end-markets with around
60% of packaging sales relating to the food and beverage sector.

S&P said, "Our assessment also reflects Pro-Gest's small size,
high operational gearing, and exposure to volatile raw material
and energy prices, which the company has historically only partly
been able to pass on to customers, often with a two-to-three-
month time lag.

"We assess Pro-Gest's financial risk profile as aggressive,
reflecting our expectation that S&P Global Ratings-adjusted
leverage will drop to around 3.7x by year-end 2018 from 4.2x at
year-end 2017. Our assessment also reflects negative free cash
flows in 2018, due to high expansion capex at Mantova and other
plants. Interest coverage will remain strong and above 5.5x over
the medium term."

S&P's base case assumes:

-- Ongoing economic recovery in Italy with real GDP growth of
    1.0%-1.2% over 2018-2020. S&P expects this growth to be
    supported by stabilizing domestic demand, a gradual
    improvement in the labor market, and favorable financial
    conditions. Nevertheless, S&P expects GDP growth to lag the
    eurozone average given the uncertainties about Italy's
    economic and political future.

-- Annual revenue growth of about 6% in 2018 and 2019, supported
    by the ramp-up (to the approved capacity of 200kt) of
    production at the Mantova plant.

-- Adjusted EBITDA margins of around 20.5% in 2018. S&P views
    this level as sustainable, given the expected operational
    efficiencies at the Mantova plant.

-- Adjusted EBITDA margins include maintenance costs (3%-4% of
    sales), which the company expenses (instead of capitalizing
    them).

-- S&P Global Ratings-adjusted EBITDA of EUR101.1 million for
    the financial year ending Dec. 31, 2018 (FY2018) reflects
    S&P's expectations of reported EBITDA of EUR98.6 million
    adjusted for operating leases (+EUR2.5 million).

-- Capex of approximately EUR99 million in 2018, mainly relating
    to the ramp-up of the Mantova mill, the development of a new
    Cartonstrong facility in Grezzago, as well as capacity
    expansions at the Pontirolo and Carnate plants.

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

-- Forecast adjusted funds from operations (FFO) to debt of
    18.2% in 2018.

-- Adjusted debt to EBITDA of 3.7x at end-FY2018.

-- Negative FOCF in FY2018.

S&P said, "The stable outlook reflects our expectation that Pro-
Gest will continue to capitalize on its solid client
relationships and leading niche position in Italy. From mid-2018,
we expect revenue and EBITDA margin improvements from the new
containerboard capacity at the Mantova paper mill. That said,
Mantova's high capex requirements will lead to negative FOCF in
2018. We expect FFO to debt of around 17.9% in FY2018.

"We could raise the rating upon the successful completion of the
Mantova plant and the realization of the expected margin
improvements and if the company generated sustainably positive
FOCF with FFO to debt comfortably above 20% and debt to EBITDA
sustainably below 3x. We would also expect a financial policy
that supports such ratios, and to see track records of steady
earnings growth and the ability to consistently meet budget,
including top-line growth and profit margins.

"We could lower the rating if Pro-Gest's profitability declined
significantly, with EBITDA margins dropping to sustainably below
19%. This could come from delays in the ramp-up of the Mantova
plant, unexpected customer losses, raw material price increases
that the company cannot pass through to customers or significant
legal claims. A more aggressive financial policy--if the company
made a large payment to shareholders or a large debt-funded
acquisition that prevented material deleveraging--could also
trigger a downgrade. A decline in FFO to debt below 15% and a
rise in adjusted debt to EBITDA above 4.5x, with persistent
negative free operating cash flows after 2019, would also lead us
to consider a downgrade."


UBI BANCA: Fitch Affirms BB+ Subordinated Debt Rating
-----------------------------------------------------
Fitch Ratings has affirmed UBI Banca's (UBI) Long-Term Issuer
Default Rating (IDR) at 'BBB-' and Viability Rating (VR) at
'bbb-'. The Outlook is Negative.

The affirmation reflects Fitch's expectation that the bank will
accelerate the reduction of its legacy non-performing loans
(NPLs), above its current strategic plan targets, in the medium
term and operate with gross and net impaired loan levels in line
with its large domestic peers. The Negative Outlook reflects
downside risks to the ratings if the bank is unable to accelerate
its NPL reduction or if capital ratios fall to close to its
regulatory minimum requirements.

KEY RATING DRIVERS
VR, IDRs AND SENIOR DEBT

UBI's IDRs and VR reflect the bank's weak asset quality, only
acceptable capitalisation, and modest performance. The VR also
reflects the bank's respectable domestic franchise as a second-
tier bank and adequate funding and liquidity.

The quality of UBI's loan portfolio with a gross impaired loan
ratio close to 14% at end-9M17 is slightly better than the
Italian banking sector average but weak by European and
international standards. UBI reported EUR13.7 billion gross
impaired loans at end-9M17, which under its current strategic
plan updated in 2017, it intends to reduce by a moderate EUR1.1
billion by end-2020. In Fitch's opinion, these originally
announced reductions are not sufficiently ambitious to strengthen
the quality of its loan portfolio, but the agency now expects the
bank to accelerate its NPL reduction and to increase planned NPL
compared with its original plans. Fitch expects that UBI's NPL
ratio will improve to single-digit gross and net impaired loan
ratios over the next three years, in line with its stronger
domestic peers. UBI increased the coverage of impaired loans to
close to 44% at end-9M17, which has brought it closer to domestic
and international peers, but unreserved impaired loans in
relation to capital remain high.

UBI's end-9M17 regulatory capital ratios were only acceptable.
The bank reported an 11.5% fully loaded CET1 ratio and a leverage
ratio of 5.8%. Both ratios are well above regulatory
requirements, but Fitch's assessment of the bank's capitalisation
incorporates Fitch view that capital remains at risk from
unreserved impaired loans. Fitch expect capital ratios to reduce
if the bank accelerates a reduction of NPLs but Fitch believe
that capital ratios will remain comfortably above regulatory
requirements, including Pillar 2 requirements.

UBI's profitability has suffered as the bank predominantly
operates in the Italian market and was therefore affected by the
economy's weak performance and the low interest rates and Fitch
believe that earnings remain vulnerable to any further
deterioration in the domestic operating environment. Fitch expect
operating profit to improve over the next three years as benefits
from cost savings, the integration of the three banks acquired in
2017 and from a greater focus on fee-generating wealth management
businesses should gradually feed through to reported earnings
from 2018.

Our assessment of funding and liquidity reflects stable customer
funding, acceptable liquidity and manageable debt maturities.
UBI's use of central bank funding is material but in line with
other Italian banks.

SUPPORT RATING (SR) AND SUPPORT RATING FLOOR (SRF)

The SR and SRF reflect Fitch's view that senior creditors can no
longer rely on receiving full extraordinary support from the
sovereign in the event that a bank becomes non-viable. The EU's
Bank Recovery and Resolution Directive (BRRD) and the Single
Resolution Mechanism (SRM) for eurozone banks provide a framework
for resolving banks that require senior creditors participating
in losses, if necessary, instead of or ahead of a bank receiving
sovereign support.

SUBORDINATED DEBT

The subordinated debt issued by the bank is one notch lower than
UBI's VR to reflect the below-average recovery prospects for the
notes given their subordinated nature. No additional notching was
applied for incremental non-performance risk as the write-down of
the notes will only occur only after the point of non-viability
is reached and there is no prior coupon flexibility.

RATING SENSITIVITIES
VR, IDRs AND SENIOR DEBT

The Negative Outlook reflects Fitch's view that UBI's ratings
could be downgraded if the bank is unable to accelerate the
reduction of its NPLs above its original plans. Fitch see
downside risks because Fitch believe that a successful reduction
of NPLs would be more difficult if the Italian economic
environment deteriorates again. The ratings could also be
downgraded if UBI's capital ratios decline significantly to close
to its regulatory requirement, which could be caused by
increasing reserve coverage to facilitate an NPL disposal. UBI's
ratings are also sensitive to a further weakening in earnings
generation.

Fitch would affirm the ratings and revise the Outlook to Stable
if UBI demonstrates its ability to reach NPL levels that are in
line with its stronger domestic peers, and show that its
franchise and business model allows it to generate adequate
profitability. An upgrade of UBI's ratings is unlikely, as
signalled by the Negative Outlook, and would require asset
quality improvements significantly above the bank's current
targets and a structural improvement in profitability.

SUBORDINATED DEBT
The subordinated debt rating is sensitive to a change in the
bank's VR, from which it is notched. The notes' rating is also
sensitive to a change in notching, which could be triggered if
Fitch reassesses the notes' loss severity or incremental non-
performance risk.

SR AND SRF
An upgrade of the SR and upward revision of the SRF are
contingent on a positive change in the sovereign's propensity to
support UBI. While not impossible, this is highly unlikely, in
Fitch's view.

The rating actions are as follows:

Long-Term IDR: affirmed at 'BBB-'; Outlook Negative
Short-Term IDR affirmed at 'F3'
Viability Rating: affirmed at 'bbb-'
Support Rating: affirmed at '5'
Support Rating Floor: affirmed at 'No Floor'
Senior debt (including programme ratings): long-term rating
affirmed at 'BBB-'/'F3'
Subordinated debt: long-term rating affirmed at 'BB+'


=================
M A C E D O N I A
=================


MACEDONIA: Fitch Revises Outlook to Positive, Affirms BB IDR
------------------------------------------------------------
Fitch Ratings has revised the Outlooks on Macedonia's Long-Term
Foreign and Local-Currency Issuer Default Ratings (IDRs) to
Positive from Negative, and affirmed the ratings at 'BB'.

KEY RATING DRIVERS

The revision of the Outlook of Macedonia's 'BB' IDRs to Positive
reflects the following key rating drivers and their relative
weights:

High
The domestic political situation is stabilising and key
international relations are improving, after a prolonged
political crisis between 2014 and 2017, which saw Macedonia
suffer the second largest percentage drop in the World Bank
governance indicator out of all Fitch-rated sovereigns.

The coalition government led by the Social Democrats (SDSM) with
the ethnic Albanian Democratic Union for Integration party is
making progress in implementing its "Plan 3-6-9" reform programme
since it came to power in May 2017. The plan aims to realign
Macedonia's policies towards EU accession, join NATO and restore
the independence and transparency of public institutions.
Municipal elections in October delivered the SDSM a strong
mandate and reduced opposition to its reforms. A special
prosecutor's office is investigating the illegal wiretaps
allegations that came to light in 2015.

The government has restarted negotiations with Greece under the
auspices of the UN over the dispute about the official name of
Macedonia. Diplomatic signals are positive, but Macedonia will
need to compromise on its name in order to unlock NATO and EU
accession, in Fitch's view. Macedonia hopes to secure a positive
recommendation in the coming months from the European Commission
to the EU Council for a date to open EU accession negotiations
later in 2018.

Medium
Preliminary outturns suggest the 2017 central government budget
deficit was 2.7% of GDP, below the government's supplementary
budget target of 2.9% and in line with 2016 deficit. The
government under-executed expenditures to meet the deficit target
in the light of lower than expected revenues, enhancing
confidence in its commitment to fiscal targets. The government is
targeting a central government budget deficit of 2.7% of GDP in
2018, and then a reduction to 2.5% in 2019, 2.3% in 2020 and 2.0%
in the medium term.

Fitch estimates general government debt was 39.2% of GDP at end-
2017 and government guarantees of non-financial SOEs were an
additional 8.2% of GDP, taking total public debt to 47.4% of GDP.
This would be the first decline in the ratio (from 48.5% in 2016)
after rising for nine years from 23% in 2008.

Macedonia's 'BB' IDRs also reflect the following key rating
drivers:

Structural indicators such as GDP per capita, human development
and governance are broadly in line with 'BB' range medians. The
business climate is favourable, according to the World Bank Ease
of Doing Business survey, which supports net inflows of FDI and a
dynamic export performance. Unemployment is high at 22%, partly
reflecting a large informal economy, but is on a downward trend.

GDP growth slowed sharply to an average of -0.4% in the first
three quarters of 2017, down from 2.9% in 2016, as political
uncertainty weighed on investment. Fitch forecasts GDP growth to
average 0.5% in 2017, below the government's revised forecast of
1.6%, but still implying a sharp rebound in 4Q17 based on a pick-
up in industrial production, exports and credit growth. Fitch
expect growth to recover to 3.1% in 2018 and 3.3% in 2019, as the
normalisation of the political situation leads to an improvement
in economic confidence.

Fitch estimates the CAD narrowed to 1.7% of GDP in 2017, from
2.8% in 2016. Exports of goods and services grew a robust 13.1%
in the first three quarters (USD terms, yoy), compared with 8.6%
for imports. Macedonia has gained market share in its main export
market (the EU) and moved up the value-added chain evident in the
rising share of exports of machinery and transport equipment and
chemical products. Net external debt was estimated at 24.5% of
GDP at end-2017, above the 'BB' range median of 12.1%.

The country has a track record of low inflation and financial
stability, underpinned by a credible and coherent macroeconomic
and financial policy framework consistent with the longstanding
exchange rate peg to the euro.

Banks are well-capitalised, liquid and profitable, and a majority
of assets are controlled by foreign-owned institutions, reducing
potential contingent liabilities. Credit to the private sector is
moderate at 48% of GDP, although euroisation of deposits (43% of
the total) and loans creates some risks in the event of pressure
on the exchange rate. The non-performing loan ratio declined to
6.3% in 2017, from 6.6% in 2016.

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

Fitch's proprietary SRM assigns Macedonia a score equivalent to a
rating of 'BB+' on the Long-Term FC IDR scale.

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

- Structural Features: -1 notch, to reflect Fitch's assessment
that risks to political stability are still assessed to be higher
than in BB peers following the extended 2014-17 political crisis,
although the political situation is normalising.

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

RATING SENSITIVITIES

The main risk factors that, individually or collectively, could
lead to an upgrade are:
- An improvement in governance standards and further reduction
   in political risk, for example through a track record of
   political stability, implementation of key institutional
   reforms and/or progress towards EU accession.
- Implementation of a medium-term fiscal consolidation programme
   consistent with a stabilisation of the public debt/GDP ratio.

The main factors that could, individually or collectively, result
in negative rating action include:
- A re-emergence of political instability that adversely affects
   governance standards, the economy and/or government policy
   direction.
- Fiscal slippage or the crystallisation of contingent
   liabilities that increases risks to the sustainability of the
   public finances.
- A widening in the current account deficit that exerts pressure
   on foreign currency reserves and/or the currency peg against
   the euro.

KEY ASSUMPTIONS
Fitch assumes that Macedonia will continue to pursue monetary,
fiscal and financial policies consistent with its currency peg to
the euro.

The full list of rating actions is as follows:

Long-Term Foreign-Currency IDR affirmed at 'BB'; Outlook revised
to Positive from Negative
Long-Term Local-Currency IDR affirmed at 'BB'; Outlook revised to
Positive from Negative
Short-Term Foreign-Currency IDR affirmed at 'B'
Short-Term Local-Currency IDR affirmed at 'B'
Country Ceiling affirmed at 'BB+'
Issue ratings on long-term senior unsecured foreign-currency
bonds affirmed at 'BB'
Issue ratings on long-term senior unsecured local-currency bonds
affirmed at 'BB'
Issue ratings on short-term senior unsecured local-currency bonds
affirmed at 'B


===========
P O L A N D
===========


I3D SA: Files Motion for Bankruptcy in Gliwice Court
----------------------------------------------------
Reuters reports that I3D SA on Feb. 6 said its management board
filed a motion for bankruptcy in the District Court of Gliwice
given the deteriorating financial situation of the company.

The company's four units -- Laboratorium Wirtualnej
Rzeczywistosci Sp. z o.o., I3d Science Sp. z o.o., I3d home Sp. z
o.o. and I3d Network SA -- also filed motions for bankruptcy in
the District Court of Gliwice.

I3D SA is based in Poland.


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


PARTNERCAPITALBANK JSC: Put on Provisional Administration
---------------------------------------------------------
The Bank of Russia, by its Order No. OD-240, dated February 2,
2018, revoked the banking license from the Moscow-based credit
institution PartnerCapitalBank (Joint-stock Company) or
PartnerCapitalBank (JSC) (Registration No. 635) from
February 2, 2018.  According to its financial statements, as of
January 1, 2018, the credit institution ranked 469th by assets in
the Russian banking system.

The business model employed by PartnerCapitalBank (JSC) was
mainly focused on placing funds in highly risky assets which led
to the accumulation of significant problem debts on the balance
sheet of this credit institution.  At the same time, the bank was
engaged in "scheme" operations in order to avoid the compliance
with the supervisor's requirements calling for the creation of
provisions for possible losses commensurate with risks assumed.

PartnerCapitalBank (JSC) failed to comply with the requirements
of the legislation and Bank of Russia regulations on countering
the legalisation (laundering) of criminally obtained incomes and
the financing of terrorism with regard to the provision of
credible information to the authorised body about operations
subject to obligatory control.  Besides, in 2017 H2, the credit
institution was actively involved in dubious payable-through
operations.

The Bank of Russia repeatedly applied supervisory measures to
PartnerCapitalBank (JSC), including two impositions of
restrictions on household deposit taking.

The management and owners of the bank failed to take any
effective measures to normalise its activities.  As it stands,
the Bank of Russia has taken the decision to withdraw
PartnerCapitalBank (JSC) from the banking services market.

The Bank of Russia took this decision due the credit
institution's failure to comply with federal banking laws and
Bank of Russia regulations, repeated violations within one year
of the requirements stipulated by Article 7 (except for Clause 3
of Article 7) of the Federal Law "On Countering the Legalisation
(Laundering) of Criminally Obtained Incomes and the Financing of
Terrorism", and the requirements of Bank of Russia regulations
issued in compliance with the indicated Federal Law, and taking
into account repeated applications within one year of measures
envisaged by the Federal Law "On the Central Bank of the Russian
Federation (Bank of Russia)".

The Bank of Russia, by its Order No. OD-241, dated February 2,
2018, appointed a provisional administration to
PartnerCapitalBank (JSC) for the period until the appointment of
a receiver pursuant to the Federal Law "On the Insolvency
(Bankruptcy)" or a liquidator under Article 23.1 of the Federal
Law "On Banks and Banking Activities".  In accordance with
federal laws, the powers of the credit institution's executive
bodies have been suspended.

PartnerCapitalBank (JSC) is a member of the deposit insurance
system. The revocation of the banking licence is an insured event
as stipulated by Federal Law No. 177-FZ "On the Insurance of
Household Deposits with Russian Banks" in respect of the bank's
retail deposit obligations, as defined by law.  The said Federal
Law provides for the payment of indemnities to the bank's
depositors, including individual entrepreneurs, in the amount of
100% of the balance of funds but no more than a total of RUR1.4
million per depositor.

The current development of the bank's status has been detailed in
a press statement released by the Bank of Russia.


RUSHYDRO CAPITAL: Fitch Rates Rouble-Denominated Notes 'BB+(EXP)'
-----------------------------------------------------------------
Fitch Ratings has assigned RusHydro Capital Markets DAC's rouble-
denominated loan participation notes (LPNs) a 'BB+(EXP)' expected
senior unsecured rating, in line with PJSC RusHydro's (RusHydro)
Long-Term Issuer Default Rating (IDR) of 'BB+', which has a
Stable Outlook.

RusHydro Capital Markets DAC is an orphan special purpose
financing vehicle. The LPNs will be issued on a limited recourse
basis for the sole purpose of funding a loan to RusHydro. The
noteholders will rely solely and exclusively on RusHydro's credit
and financial standing for the payment of obligations under the
LPNs. RusHydro plans to use the net proceeds from the notes for
general corporate purposes, including the refinancing of upcoming
debt maturities and capex funding.

The final rating is contingent upon the receipt of final
documentation conforming materially to information already
received and details regarding the amount, coupon rate and
maturity.

The 'BB+' IDR reflects RusHydro's improved credit metrics and
solid business profile. Fitch forecast RusHydro's funds from
operations (FFO)-adjusted net leverage will be below 3.0x during
2017-2021 due to strong financial and operational performance in
2016 and over the next five years.

RusHydro's IDR incorporates a single-notch uplift for state
support from the company's standalone rating of 'BB', due to
strong strategic, operational and, to a lesser extent, legal ties
between the company and its majority shareholder, the Russian
Federation (BBB-/Positive).

KEY RATING DRIVERS

State Support: RusHydro continues to receive tangible state
support. In 2012-2016 the company received support of more than
RUB173 billion, including a RUB50 billion equity injection for
the construction of four thermal power plants in the Far East in
2012, direct subsidies of RUB68 billion as compensation for low
tariffs in the Far East, and a recent RUB55 billion injection
from state-owned VTB Bank for the repayment of Far East debt.

Nevertheless, the consolidation of financially weaker RAO Energy
System of the East Group (RAO UES East) in 2011 and the
government's decision to increase dividend payments for 2016 to
50% from net income weakened the company's operating and
financial profile, underlining the negative implications of state
involvement.

Forward Contract with VTB: In March 2017 RusHydro received a
RUB55 billion cash injection from the state, via a 13% share
purchase by VTB. These proceeds were used to repay RAO UES East's
debt. VTB has also signed a non-deliverable (with no obligation
on RusHydro to buy back its shares from VTB) five-year forward
contract with RusHydro. Either RusHydro or VTB must compensate
for the difference between the forward value (share price at
which the deal was made) and the value at sale of RusHydro's
shares in five years: that is, if the value at sale is below the
forward value, the difference is paid by RusHydro to VTB, and
vice versa.

The company states that the sale of this stake would require
state approval. In Fitch rating case, Fitch treat this RUB55
billion fully as debt before the expiry of this contract as the
potential liability under this forward contract would rank pari
passu with existing senior unsecured debt and there is no
deferral option on RusHydro's payments to VTB for the duration of
the contract. Fitch will reclassify any amount remaining with
RusHydro after the contract termination as equity, which will
have a positive effect on its credit metrics, other things being
equal. However, the rating is not constrained by Fitch current
treatment of the contract.

Solid Financial Profile: Fitch forecast RusHydro's FFO-adjusted
net leverage to be below 3.0x during 2017-2021 due to strong
financial and operational performance in 2016-9M17 and over the
next five years. Fitch also forecasts 2017-2021 EBITDA will
remain at around RUB98 billion (RUB93 billion in 2016) and that
the EBITDA margin will remain at around 24%. This is based on
Fitch expectation that tariffs will be increased below CPI,
whereas a large part of the operating costs (eg fixed costs) will
increase at the rate of CPI. The resulting impact is partially
offset by new capacity coming online.

Capex Results in Negative FCF: Fitch expects RusHydro to continue
to generate negative free cash flow (FCF) on average of around
RUB20 billion, owing to its substantial capex programme of RUB342
billion (including VAT) over 2017-2020, which Fitch expect will
be partially debt-funded. Around a third of RusHydro's capex
relates to RAO UES East. This contrasts with positive FCF
generation by RusHydro's closest peers, PJSC Inter RAO (BBB-
/Stable), PJSC Mosenergo (BBB-/Stable) and Enel Russia PJSC
(BB+/Stable), which have completed their expansionary capex
programmes.

However, RusHydro has flexibility to cut back its investment
programme if there is a lack of available funding or material
deterioration in its credit metrics, especially in the context of
increased dividend payments from 2016, as demonstrated in the
past. In 2016 capex fell by more than 30% yoy.

'BB' Standalone Rating: RusHydro's standalone rating of 'BB'
reflects the company's strong market position as a leading, low-
cost electricity producer in Russia with a large portfolio of
hydro power plants with installed electric power capacity of
about 39GW. The standalone profile also reflects exposure to
regulated tariffs via its RAO UES East division, which will
remain a drag on profitability and cash flows. The standalone
rating also factors in the risks associated with the regulatory
framework in the Russian utilities sector in the medium term and
the general operating environment in Russia.

DERIVATION SUMMARY

RusHydro is one of the largest power generation companies in
Russia and listed hydroelectric generation companies in the world
by installed capacity. It is also exposed to fossil-fuel
generation via its RAO UES East division, and compares well with
other rated generating companies such as Inter RAO, Mosenergo and
Public Joint Stock Company Territorial Generating Company No. 1
(TGC-1, BB+/Stable) by operational metrics. Peers are also
subject to regulatory uncertainties and low visibility on medium-
term tariff increases, and have large investment programmes.
However, in contrast to RusHydro, Inter RAO, Mosenergo and Enel
Russia generate a large share of their cash flows from capacity
sales under capacity supply agreements, which support their cash-
flow stability.

RusHydro's financial profile is weaker than Inter RAO's and
Mosenergo's on FFO-based net leverage, and quite similar to TGC-
1's, varying historically between 2.0x and 3.0x. The ratings of
Russian utilities reflect the uncertainty pertaining to the
regulatory framework in the sector and general operating
environment in Russia. RusHydro's IDR incorporates a one-notch
uplift to the company's 'BB' standalone rating for parental
support from the ultimate indirect majority shareholder, the
Russian Federation.

KEY ASSUMPTIONS

Fitch's Key Assumptions within Fitch Rating Case for RusHydro
include:
- Domestic GDP and inflation increase of 2.2% and 4.3% in 2018
   and by 2% and 4.5% in 2019-2021;
- Electricity and heat tariffs and power prices to increase
   below CPI over 2017-2021;
- Dividends at 50% of net income under IFRS for 2017-2021;
- RUB55 billion cash injection by VTB fully treated as debt; and
- Haircuts to capex for 2017, 2018 and 2019 of 20%, 20% and 10%,
   respectively, compared with management expectations.

RATING SENSITIVITIES

Developments that May, Individually or Collectively, Lead to
Positive Rating Action
- Capex and opex moderation resulting in improvement of the
   financial profile (eg generation of positive FCF and FFO net
   adjusted leverage below 2.0x and FFO fixed charge coverage
   above 4x on a sustained basis).

Developments that May, Individually or Collectively, Lead to
Negative Rating Action
- The inability to maintain FFO adjusted net leverage below 3.0x
   and FFO fixed charge coverage above 3.0x, due to weaker
   financial profile and a more ambitious capex programme.

LIQUIDITY AND DEBT STRUCTURE

Adequate Liquidity: At end-2017 RusHydro had cash and deposits of
around RUB69 billion (excluding the remaining state financing of
around RUB6 billion, which includes cash injection in December
2012 for financing RAO UES East's projects). In addition to
available uncommitted credit lines totalling around RUB117
billion, including from such large state-owned banks as VTB Bank,
Gazprombank (Joint-stock Company) (BB+/Positive) and Sberbank of
Russia (BBB-/Positive), this is sufficient to cover short-term
debt of RUB74 billion.

Limited FX Exposure: RusHydro has limited exposure to foreign-
currency risks. At end-2017 around 5% of RusHydro's debt was
denominated in foreign currencies, mainly euros, while almost all
its revenue is in local currency.

Upcoming Eurobond Placement: The LPNs to be issued by RusHydro
Capital Markets DAC are ranked pari passu with other senior
unsecured obligations of RusHydro. The LPNs will have the benefit
of change of control clause if Russia ceases to own or control
(directly or indirectly) in excess of 50% of voting shares,
negative pledge clauses and certain restrictions on mergers,
acquisitions and disposals. Events of default include non-payment
under this issue and non-payment of any other indebtedness
exceeding a USD50 million threshold.


SECOND GENERATING: Fitch Raises Long-Term FC IDR to 'BB+'
---------------------------------------------------------
Fitch Ratings has upgraded PJSC The Second Generating Company of
Wholesale Power Market's (OGK-2) Long-Term Foreign-Currency
Issuer Default Rating (IDR) to 'BB+' from 'BB'. The Outlook is
Stable.

The upgrade reflects OGK-2's improved credit metrics on the back
of an increased share of revenue generated under capacity supply
agreements (CSAs) and its significant contribution to cash-flow
stability of operations. Fitch expects that the company will
maintain a solid financial profile over 2017-2021 with moderate
capex and in spite of Fitch's expectation of higher dividend
payments above the company's forecasts.

OGK-2's 'BB+' rating incorporates a one-notch uplift for parental
links with its majority shareholder (77.24%), Gazprom
Energoholding (GEH) and ultimately PJSC Gazprom (BBB-/Positive),
which is the sole owner of Gazprom Energoholding.

KEY RATING DRIVERS

Improved Financial Profile: The company outperformed Fitch
previous forecasts for 2016-2017. OGK-2 reported strong 9M17
results. Its EBITDA reached RUB23.8 billion against RUB13.7
billion in 9M16 on the back of full operation of all units under
CSAs. Fitch expect the company to maintain solid credit metrics
over 2017-2021 due to capex moderation and relatively stable
cash-flow generation under the CSAs. Fitch expect funds from
operations (FFO) net adjusted leverage to remain below 3x on
average over 2017-2021 (2.9x in 2016) and FFO fixed charge
coverage to be above 4x (3.5x in 2016) on average for the same
period.

Positive FCF Expected: The completion of investments in new
capacity in 2016 contributed to OGK-2's financial flexibility.
Fitch expect the company to remain free cash flow (FCF) positive
in 2017-2021. Fitch assumed average annual investments of about
RUB11 billion over 2018-2021, which is in line with the average
of the last two years (2016-2017) and well above the company's
maintenance capex (annual average RUB3.6 billion). Fitch also
assumed a dividend payout ratio of 50% from 2018 in line with
other Russian state-owned companies, which is above the company's
expectations of 20%.

CSAs Drive EBITDA Growth: Fitch expect OGK-2's financial profile
over the rating horizon to be mainly driven by capacity payments
under CSAs. In contrast to most other rated thermal generators,
OGK-2 is among the latest companies to have completed the
commissioning of its CSA units. It estimates that the newly
commissioned units operating under the CSAs contributed around
75% of its 2016 EBITDA, and expects its share to stay at around
85% over 2017-2020 as a result of the expected CSA tariff hikes.

Fitch expect relatively high tariffs in 2021 as almost half of
new power units are entering the last four years of the 10-year
payback period for new capacity, which according to the CSA
mechanism should lead to a tariff hike.

Post CSA Regulatory Changes: For around one-third of OGK-2's
power units operating under CSAs the 10-year payback period
expires in 2021-2022, and these units will revert to market
terms, which might put pressure on EBITDA. However, Fitch expect
the credit metrics over 2021-2022 to remain solid and
commensurate with the rating. In addition, the Ministry of Energy
recently proposed a new mechanism for the modernisation of
generating companies' existing thermal power units, which is
similar to the CSA framework for new units. Fitch expect this
might support OGK-2's post-CSA cash-flow stability, once
approved.

Similar to other Russian utilities, OGK-2's rating incorporates
the risks associated with the regulatory framework in the
utilities sector and general operating environment in Russia.

Solid Business Profile: OGK-2's business profile benefits from
its solid market share, as one of the largest power generating
companies in Russia, responsible for about 8% of total installed
electric capacity in 2016, and the diversity of its operations by
number of plants, fuel mix, geography and customer base. With
installed power capacity of 19 GW and heat capacity of 4,169
Gcal/h in 2016, the company is comparable to PJSC Mosenergo (BBB-
/Stable) but is smaller than PJSC Inter RAO (BBB-/Stable).

Single-Notch Uplift for Parental Links: Fitch assess the ties
between the company and its ultimate majority shareholder as
moderately strong. The strength of the ties is supported by OGK-
2's integral role in Gazprom's strategy of vertical integration
and the fact that it contributed 21% of GEH's EBITDA in 2016.
Furthermore, around half of OGK-2's total outstanding debt at
end-9M17 was loans from Gazprom.

DERIVATION SUMMARY

OGK-2's rating is supported by its strong market position and
expected solid financial profile, which is enhanced by most of
its cash flow generated under CSAs with favourable economics
supporting the stability of its cash flow. OGK-2 has a weaker
financial profile than PJSC Mosenergo (BBB-/Stable) and Inter RAO
(BBB-/Stable), but it is quite similar to Public Joint Stock
Company Territorial Generating Company No. 1 (TGC-1, BB+/Stable).
It operates on a much larger scale than TGC-1 and is comparable
to Mosenergo, and has greater geographic diversity than these two
peers. Similar to many other Russian utilities OGK-2's 'BB+' IDR
incorporates a one-notch uplift for parental support.

KEY ASSUMPTIONS

Fitch's Key Assumptions Within Fitch Rating Case for OGK-2
Include:

- domestic GDP and inflation increase of 2.2% and 4.3% in 2018
   and by 2.0% and 4.5% in 2019-2021;
- net power output marginal decrease over 2017-2021;
- gas tariffs indexation by around 3% over 2017-2021;
- power price growth slightly below gas price increase over
   2017-2021;
- electricity tariffs to increase below inflation;
- dividends at 50% of net income under IFRS starting from 2018,
   against management expectation of 20%;
- capex in line with management expectations for 2017, and in
   line with the average of the last two years (2016-2017)
   thereafter;
- average cost of new borrowings of 10% in 2018 and thereafter;
- the repayment of RUB6.1 billion for the acquisition of a 90%
   stake in OGK-Investproekt from PJSC Mosenergo within 2018-2019
   and RUB10.9 billion of OGK-Investproekt's total debt according
   to the repayment schedule.

RATING SENSITIVITIES

Developments That May, Individually or Collectively, Lead to
Positive Rating Action
- Improvement in financial profile due to, among other things,
   increased predictability of the regulatory and operational
   framework in Russia, higher-than-expected growth in tariffs
   and/or volumes supporting FFO net adjusted leverage below 2x
   and FFO fixed charge coverage above 5.5x on a sustained basis.
- Sustainable positive FCF generation
- Stronger parental support.

Developments That May, Individually or Collectively, Lead to
Negative Rating Action
- Inability to improve credit metrics so that FFO net adjusted
   leverage remains above 3x and FFO fixed charge coverage stays
   below 4x on a sustained basis due to, among other factors,
   lower volumes of electricity and capacity sales, lower tariffs
   or a margin squeeze caused by a rise in fuel prices not fully
   compensated by a rise in electricity prices, weak working-
   capital management, M&A resulting in higher debt, and/or an
   intensive capex programme.

- Weakening of parental support, which may result in a removal
   of the one-notch uplift to OGK-2's standalone rating.

- Deterioration of the regulatory and operating environment in
   Russia.

LIQUIDITY

Adequate Liquidity: OGK-2's cash and cash equivalents stood at
RUB5.8 billion at end-9M17 which together with uncommitted unused
credit facilities of RUB50.5 billion mainly from major Russian
banks were sufficient to cover upcoming short-term debt
maturities of RUB3.7 billion. Under all credit facilities OGK-2
does not pay commitment fees, which is a common practice in
Russia. Fitch expect funding from state-owned banks to be
available to the company. Almost half of debt at end-9M17 was
loans from Gazprom. Fitch also expect the company to continue
generating positive FCF over 2017-2021.

FULL LIST OF RATING ACTIONS

Long-Term Foreign- and Local-Currency IDRs: upgraded to 'BB+'
from 'BB', Outlook Stable
Local-currency senior unsecured rating: upgraded to 'BB+' from
'BB'
Short-Term Foreign and Local-Currency IDRs: affirmed at 'B'


SIBERIAN BANK: Put on Provisional Administration, License Revoked
-----------------------------------------------------------------
The Bank of Russia, by its Order No. OD-280, dated February 6,
2018, revoked the banking license of the Tyumen-based credit
institution Siberian Bank for Reconstruction and Development
(Limited Liability Company), or Bank SBRD (LLC) (Registration No.
1284) from February 6, 2018.  According to the financial
statements, as of January 1, 2018, the credit institution ranked
322th by assets in the Russian banking system.

The credit institution's financial standing has deteriorated
considerably due to large securities transactions aimed at
replacing liquid assets with knowingly bad ones during the last
ten days of January and as a result of missing valuables in large
amount from the bank's till.  Creation of required loss provision
for actually missing assets at the request of the supervisory
authority revealed a full loss of equity capital by the credit
institution.  Currently, Bank SBRD (LLC) has in fact ceased all
operations.  Therefore, the credit institution's operations
showed signs of misconduct by the management who conducted
transactions aimed at the withdrawal of liquid assets to the
detriment of creditors' and depositors' interests.

The Bank of Russia has repeatedly applied supervisory measures
against Bank SBRD (LLC), which included restrictions (on two
occasions) and a ban on household deposit taking.

Under these circumstances, the Bank of Russia performed its duty
on the revocation of the banking license of the credit
institution in accordance with Article 20 of the Federal Law 'On
Banks and Banking Activities'.

The Bank of Russia took such an extreme measure because of the
credit institution's failure to comply with federal banking laws
and Bank of Russia regulations, equity capital adequacy ratios
below two per cent, decrease in the bank's equity capital below
the minimum value of the authorized capital established as of the
date of the state registration of the credit institution, and
given the repeated application within a year of measures
envisaged by the Federal Law "On the Central Bank of the Russian
Federation (Bank of Russia)".

Following banking license revocation, in accordance with Bank of
Russia Order No. OD-280, dated 6 February 2018, Bank SBRD (LLC)'s
professional securities market participant license was revoked.

The Bank of Russia, by its Order No. OD-281, dated February 6,
2018, appointed a provisional administration to Bank SBRD (LLC)
for the period until the appointment of a receiver pursuant to
the Federal Law 'On the Insolvency (Bankruptcy)' or a liquidator
under Article 23.1 of the Federal Law 'On Banks and Banking
Activities'. In accordance with federal laws, the powers of the
credit institution's executive bodies have been suspended.

Bank SBRD (LLC) is a member of the deposit insurance system. The
revocation of the banking licence is an insured event as
stipulated by Federal Law No. 177-FZ 'On the Insurance of
Household Deposits with Russian Banks' in respect of the bank's
retail deposit obligations, as defined by law. The said Federal
Law provides for the payment of indemnities to the bank's
depositors, including individual entrepreneurs, in the amount of
100% of the balance of funds but no more than a total of 1.4
million rubles per depositor.

The current development of the bank's status has been detailed in
a press statement released by the Bank of Russia.


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


TDA IBERCAJA 3: S&P Raises Class C Notes Rating to BB (sf)
----------------------------------------------------------
S&P Global Ratings raised its credit ratings on TDA Ibercaja 3
Fondo de Titulizacion de Activos' class A, B, and C notes.

The upgrades follow the application of our relevant criteria and
our credit and cash flow analysis of the most recent transaction
information that we have received, and reflect the transaction's
current structural features.

S&P said, "Long-term delinquencies (defined in this transaction
as loans in arrears for more than 90 days, excluding defaults)
have decreased to 0.34% from 0.69% since our previous full review
on Dec. 1, 2014, with outstanding defaulted loans (loans in
arrears for more than 18 months) net of recoveries standing at
0.45% of the initial balance of the pool.

"In our opinion, the outlook for the Spanish residential mortgage
and real estate market is not benign and we have therefore
increased our expected 'B' foreclosure frequency assumption to
3.33% from 2.00%, when we apply our European residential loans
criteria, to reflect this view.

"Our credit analysis results show a decrease in both the
weighted-average foreclosure frequency (WAFF) and weighted-
average loss severity (WALS) for each rating level based on the
higher seasoning of the pool, the transaction's improved
performance, and the lower current loan-to-value ratios."

  Rating level     WAFF (%)    WALS (%)
  AAA                 14.22        9.95
  AA                  10.63        7.64
  A                    8.69        4.20
  BBB                  6.31        2.80
  BB                   4.05        2.01
  B                    3.37        2.00

The reserve fund is at the required level and is currently at its
floor value of EUR5 million, which represents 1.77% of the
current notes' balance. All classes of notes are amortizing pro
rata. There are interest deferral triggers for the subordinated
notes in this transaction, based on the level of outstanding
defaults net of recoveries over the original balance of the
assets securitized, which is 0.45%. Given that the lowest
interest deferral trigger (class C trigger) is set at 4.30%, and
based on the pool's historical favorable performance, S&P doesn't
expect the triggers to be breached in the short to medium term.

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

The bank account provider in this transaction is Societe Generale
S.A. (Madrid Branch), which has downgrade language commensurate
with a 'AAA (sf)' rating. The swap counterparty is Banco
Santander S.A. (A-/Stable/A-2). Considering the remedial actions
defined in the swap counterparty agreement, that the swap
counterparty is not currently posting collateral, and its current
issuer credit rating (ICR), under S&P's current counterparty
criteria the maximum rating the notes in this transaction can
achieve is 'AA (sf)'.

S&P said, "Following the application of our structured finance
ratings above the sovereign (RAS) criteria, counterparty, and
European residential loans criteria, we have determined that our
assigned ratings on the class A notes in this transaction should
be the lower of (i) the rating as capped by our RAS criteria,
(ii) the rating as capped by our current counterparty criteria,
and (iii) the rating that the class of notes can attain under our
European residential loans criteria. In this transaction, the
application of our RAS criteria caps our ratings on the class A
notes at three notches above our 'BBB+' foreign currency long-
term sovereign rating on Spain.

"Taking into account the results of our application of our
European residential loans criteria, the class A notes are able
to pass our 'A+' rating level stresses. Accordingly, we have
raised to 'A+ (sf)' from 'BBB+ (sf)' our rating on the class A
notes.

"We have raised our ratings on the class B and C notes as the
credit enhancement for these classes of notes is commensurate
with the stresses we apply at higher levels than those currently
assigned. Our ratings on the class B and C notes are linked to
our long-term ICR on the servicer, Ibercaja Banco
(BB+/Positive/B), as in our cash flow analysis we are excluding
the application of a commingling loss."

TDA Ibercaja 3 is a Spanish RMBS transaction that closed in May
2006. The transaction securitizes residential loans originated by
Ibercaja Banco, which were granted to individuals for the
acquisition of their first residence, mainly concentrated in
Madrid and Aragon, Ibercaja Banco's main markets.

RATINGS LIST

  TDA Ibercaja 3, Fondo de Titulizacion de Activos
  EUR1.007 Billion Mortgage-Backed Floating-Rate Notes

  Class              Rating
               To              From

  Ratings Raised
  A            A+ (sf)         BBB+ (sf)
  B            BB+ (sf)        BB (sf)
  C            BB (sf)         B (sf)


TDA IBERCAJA 4: S&P Raises Class E Notes Rating to BB (sf)
----------------------------------------------------------
S&P Global Ratings raised its credit rating on TDA Ibercaja 4
Fondo de Titulizacion de Activos' class A2, D, and E notes. At
the same time, S&P has affirmed its ratings on the class A1, B,
C, and F notes.

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

"Long-term delinquencies (defined in this transaction as loans in
arrears for more than 90 days, excluding defaults) have decreased
to 0.54% from 1.16% since our previous full review on Jan. 23,
2015, with net defaulted loans (loans in arrears for more than 18
months net of recoveries) standing at 0.87% of the initial
balance of the pool.

"In our opinion, the outlook for the Spanish residential mortgage
and real estate market is not benign and we have therefore
increased our expected 'B' foreclosure frequency assumption to
3.33% from 2.00%, when we apply our European residential loans
criteria, to reflect this view.

"Our credit analysis results show a decrease in both the
weighted-average foreclosure frequency (WAFF) and weighted-
average loss severity (WALS) for each rating level based on the
higher seasoning of the pool, the transaction's improved
performance, and the lower current loan-to-value ratios."

  Rating level     WAFF (%)    WALS (%)
  AAA                 18.00       14.64
  AA                  13.53       12.27
  A                   11.08        8.32
  BBB                  8.07        6.44
  BB                   5.24        5.21
  B                    4.38        4.17

The reserve fund is at the required level and is currently at its
floor value of EUR7 million, which represents 1.57% of the
current notes' balance. The class A1 and A2 notes are amortizing
pro rata with the junior tranches. There are interest deferral
triggers for the subordinated notes in this transaction, based on
the level of outstanding defaults net of recoveries over the
original balance of the assets securitized, which is 0.87%. Given
that the lowest interest deferral trigger (class E trigger) is
set at 4%, and based on the pool's historical favorable
performance, S&P doesn't expect the triggers to be breached in
the short to medium term.

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

The bank account provider in this transaction is Societe Generale
S.A. (Madrid Branch), which has downgrade language commensurate
with a 'AAA (sf)' rating. The swap counterparty is Banco
Santander S.A. (A-/Stable/A-2). S&P said, "Considering the
remedial actions defined in the swap counterparty agreement, and
its current issuer credit rating (ICR), under our current
counterparty criteria the maximum rating the notes in this
transaction can achieve is 'AA (sf)'. We have tested the
structure without giving credit to the support provided by the
swap contract. The class A notes obtain the same results without
the support of the swap, therefore we have delinked our rating on
this class of notes from the ICR on the swap provider."

S&P said, "Following the application of our structured finance
ratings above the sovereign (RAS) criteria, counterparty, and
European residential loans criteria, we have determined that our
assigned ratings on the class A1 and A2 notes in this transaction
should be the lower of (i) the rating as capped by our RAS
criteria, (ii) the rating as capped by our current counterparty
criteria, and (iii) the rating that the class of notes can attain
under our European residential loans criteria. In this
transaction, the application of our RAS criteria caps our ratings
on the class A1 and A2 notes at six and four notches,
respectively, above our 'BBB+' foreign currency long-term
sovereign rating on Spain.

"Taking into account the results of our application of our
European residential loans criteria, the class A1 and A2 notes
are able to pass our 'AAA' and 'A+' rating level stresses,
respectively. Accordingly, we have affirmed our 'AA+ (sf)' rating
on the class A1 notes. At the same time, we have raised to 'A+
(sf)' from 'A (sf)' our rating on the class A2 notes.

"We have affirmed our 'BBB+ (sf)' rating on the class B notes as
the available credit enhancement for this class of notes is
commensurate with the stresses we apply at the assigned rating
level.

"Our ratings on the class C, D, E, and F notes are linked to our
long-term ICR on the servicer, Ibercaja Banco (BB+/Positive/B),
as the available credit enhancement for these tranches is
commensurate with the stresses we apply at the currently assigned
ratings, excluding the application of a commingling loss.

"Our credit and cash flow analysis indicates that the available
credit enhancement for the class C notes is commensurate with the
currently assigned rating. We have therefore affirmed our 'BB+
(sf)' rating on the class C notes. At the same time, we have
raised to 'BB+ (sf)' and 'BB (sf)' our ratings on the class D and
E notes, respectively, as the available credit enhancement for
these tranches is commensurate with the stresses we apply at the
'BB+' and 'BB' ratings.

"The class F notes have not paid all interest due on recent
interest payment dates and we have therefore affirmed our 'D
(sf)' rating on this class of notes."

TDA Ibercaja 4 is a Spanish RMBS transaction that closed in
October 2006. The transaction securitizes residential loans
originated by Ibercaja Banco, which were granted to individuals
for the acquisition of their first residence, mainly concentrated
in Madrid and Aragon, Ibercaja Banco's main markets.

  RATINGS LIST

  TDA Ibercaja 4, Fondo de Titulizacion de Activos
  EUR1.411 Billion Mortgage-Backed Floating-Rate Notes

  Class              Rating
             To              From

  Rating Raised
  A2           A+ (sf)         A (sf)
  D            BB+ (sf)        B (sf)
  E            BB (sf)         B- (sf)

  Ratings Affirmed
  A1           AA+ (sf)
  B            BBB+ (sf)
  C            BB+ (sf)
  F            D (sf)


===========
S W E D E N
===========


ITIVITI GROUP: S&P Assigns Prelim 'B' CCR on Ullink Acquisition
---------------------------------------------------------------
S&P Global Ratings assigned its preliminary 'B' long-term
corporate credit rating to Sweden-based trading software provider
Itiviti Group AB. The outlook is stable.

S&P said, "At the same time, we assigned our preliminary 'B'
issue rating to Itiviti's proposed first-lien term loan due 2025,
with a preliminary '3' recovery rating, indicating our
expectation of meaningful recovery at around 50% in the event of
a payment default.

"We also assigned our preliminary 'CCC+' issue rating to
Itiviti's proposed second-lien term loan due 2026, with a
preliminary recovery rating of '6', indicating our expectation of
minimal recovery of 0% in the event of a payment default."

Itiviti is a global provider of trading software for banks and
trading firms, mainly focused on sell-side capabilities within
cash equities and derivatives. It intends to acquire Ullink,
which provides trading and connectivity software for buy-side and
sell-side institutions. Itiviti plans to fund the merger, as well
as refinance its existing debt, by signing a $535 million
(Swedish krona [SEK]4.6 billion) first-lien term loan and an $140
million (SEK1.2 billion) second-lien term loan.

S&P said, "Our rating on Itiviti primarily reflects our
expectation of the proposed combined group's high leverage (debt
to EBITDA) following the proposed Ullink acquisition. The rating
also factors in the enlarged entity's relatively small scale,
narrow product focus, competition from larger players, and
relatively high churn in recent years. We also incorporate
Itiviti's solid cash flow generation, high share of recurring
revenues, strong position in the niche market of trading
software, and positive medium-term growth prospects.

"Our assessment of Itiviti's business risk profile is constrained
by the group's small scale compared with peers' in a highly
fragmented market. With pro forma revenues of SEK1.8 billion
($215 million) in 2017, Itiviti is a relatively small player
exposed to competition from financially larger players such as
Sungard, Fidessa, Bloomberg, and Reuters. Furthermore, Itviti
operates in a niche within the market for trading software.
Although the addressable market within Itiviti's asset classes
totals nearly $6 billion, the market is highly fragmented and
about 60% is still served by in-house solutions. Our view of the
group's business risk is further constrained by relatively high
churn rates for Itiviti (excluding Ullink) in recent years, with
a peak of 20% in 2017. We understand that known closures of
trading desks largely explain the high churn, coupled with in-
market consolidation among banks. In our view, Itiviti's high
exposure to lowered tiered financial institutions (more than 40%
of total revenues in 2017) partly accounts for the higher churn
because many of its customers are more exposed to downsizing and
closures, and are potential acquisition targets for bigger firms.
We therefore still expect that churn related to downsizing could
influence revenue growth in coming years. We note, however, that
Itiviti's strategy to actively focus on Tier 1 and Tier 2 banks
should gradually decrease its exposure to Tier 3 banks, while
increasing customer stickiness.

"These weaknesses are in part balanced by Itiviti's high
recurring revenues, which we expect will exceed 90% for the
combined entity. This revenue base provides good revenue
visibility compared with those of peers that rely more on
perpetual license fees or nonrecurring professional services.
Most contracts run for 12 months and are automatically renewed
unless actively cancelled. Although the contact period is
relatively short, we take into account that Itiviti has long-
standing relationships with 65% of customers for more than seven
years. Moreover, we consider Itiviti's software to be generally
mission critical for banks' daily trading activities.
Furthermore, as a global player, Itiviti has strong geographic
diversification and limited customer concentration because its
top customers account for just 5% of revenues.

"We expect that the combination of Itiviti's Trading and Market
Making solutions division with Ullink's NYFIX network and low and
high touch trading products will complement existing connectivity
solutions. The combination should also enable the group to offer
end-to-end solutions and a more competitive platform. In our
view, we consider that Itiviti is well positioned to capture
growth opportunities from the trend toward IT outsourcing at
financial institutions. It's also poised to benefit from
increased demand for solutions assisting banks to comply with new
standards required by the regulatory changes according to the
EU's Markets in Financial Instruments Directive (MIFID) II, which
came into effect on Jan. 3, 2018. We view Itiviti's profitability
as solid despite its limited scale, with S&P Global Ratings-
adjusted EBITDA margins of 30%. We expect that the proposed
merger will further improve profitability, thanks to synergies
from reduced overheads. We therefore project S&P Global Ratings-
adjusted EBITDA margins will widen to about 40% by 2019, after
expensing capitalized research and development (R&D) costs of
about SEK240 million.

"In our assessment of Itiviti's financial risk profile, we factor
in the group's ownership and control by financial sponsor Nordic
Capital, which results in aggressive debt funding, which the
highly leveraged capital structure shows. We also take into
account Itiviti's very high S&P Global Ratings-adjusted debt,
primarily consisting of the $675 million (SEK5.8 billion) term
loan, SEK550 million of preference shares, and operating-lease
obligations of about SEK280 million. This is somewhat mitigated
by Itiviti's free operating cash flow (FOCF) generation, which we
expect will be SEK250 million-SEK400 million annually over the
coming two years, leading to a ratio of FOCF to debt of more than
5%. When calculating Itiviti's adjusted credit metrics, we deduct
capitalized development costs from EBITDA and reduce capital
expenditures accordingly.

"The stable outlook on Itiviti reflects our expectation of solid
revenue growth and EBITDA margin improvements stemming from
increasing scale and cost synergies. We consequently project, by
year-end 2019, adjusted debt to EBITDA well below 8.5x (excluding
shareholder loans and nonrecurring costs), solid FOCF of at least
5% of debt, and EBITDA cash interest coverage exceeding 2.5x.

"We could lower the rating if Itiviti's revenues and EBITDA do
not improve in line with our base case, for example due to
higher-than-expected churn or issues related to integrating
Ullink, resulting in debt to EBITDA higher than 8.5x and/or FOCF
to debt lower than 5%.

"We currently view an upgrade of Itiviti as remote, because it
would likely stem from deleveraging, resulting in debt to EBITDA
of about 5x, and FOCF generation of around 10%, supported by the
financial sponsor's commitment to maintain this more moderate
financial profile."


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


AVANTI COMMUNICATIONS: Moody's Withdraws Ca Corp. Family Rating
---------------------------------------------------------------
Moody's Investors Service has withdrawn all ratings of Avanti
Communications Group plc, including the company's Ca corporate
family rating (CFR), Ca-PD probability of default rating (PDR)
and Ca rating on its senior secured bonds.

RATINGS RATIONALE

Moody's has withdrawn the ratings for its own business reasons.

Avanti Communications Group Plc is a fixed-satellite service
provider, with licenses for three geostationary orbital slots.
The company sells satellite data communications services to
telecom companies, which supply those to enterprise,
institutional and consumer users. Avanti's first satellite, HYLAS
1, launched in November 2010, was the first Ka-band satellite
launched in Europe. Its second satellite, HYLAS 2, was launched
in August 2012 and extends coverage to Africa, the Caucasus and
the Middle East. HYLAS 3 and HYLAS 4 will complete Avanti's
coverage of EMEA following their expected launches in 2017.
Founded in 2002, the present group was formed when the company
floated on the Alternative Investment Market in 2007. For fiscal
year 2017 (ended June 30, 2017), Avanti reported revenue of
US$56.6 million and EBITDA of negative US$32.5 million.

REGULATORY DISCLOSURES

For any affected securities or rated entities receiving direct
credit support from the primary entity(ies) of this credit rating
action, and whose ratings may change as a result of this credit
rating action, the associated regulatory disclosures will be
those of the guarantor entity. Exceptions to this approach exist
for the following disclosures, if applicable to jurisdiction:
Ancillary Services, Disclosure to rated entity, Disclosure from
rated entity.


CARILLION PLC: J. Murphy & Sons Buys UK Power Framework Business
----------------------------------------------------------------
Rahul B at Reuters reports that Britain's J. Murphy & Sons
Limited on Feb. 7 has bought Carillion's UK power framework
business for an undisclosed sum.

According to Reuters, the company said it will take over
Carillion's position on National Grid's overhead electricity
lines, substation and underground cable framework contracts and
Carillion employees will join Murphy.

The Official Receiver, which manages insolvencies for the British
government, has since been looking through the about 450
contracts that Carillion was managing when it collapsed, seeking
alternative contractors to complete the tasks, Reuters relates.

Murphy said it will also become the new joint venture partner of
Eltel, the Swedish supplier of services for infrastructure
networks, on overhead line and T-Pylon framework contracts,
Reuters notes.

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: UK Gov't Spent GBP150MM on Financing Liquidation
---------------------------------------------------------------
Rhiannon Curry at The Telegraph reports that the UK Government
has already spent GBP150 million on financing the wind down of
Carillion, it was revealed late on Feb. 7 as the Qatari company
which has been blamed for its downfall hit back at claims that it
had withheld payments.

According to The Telegraph, David Lidington, minister for the
Cabinet Office, told MPs at a parliamentary liaison committee
that the Treasury had provided an initial GBP150 million to the
Official Receiver, who is responsible for overseeing Carillion's
liquidation, to cover the cost of keeping some services which the
company had been running, and for legal fees.

Mr. Lidington could not rule out more money being spent at a
later date, although he added that some of the money could be
recovered as the process continued, The Telegraph notes.

Meanwhile, Msheireb Properties, a Qatari company which had
contracted Carillion to work on a scheme in Doha, hit back at
claims made by the UK company's directors that it owed Carillion
money, The Telegraph discloses.

Carillion's former chief executive Richard Howson had told a
joint business and pensions select committee on Feb. 6 that he
had felt like "a bailiff" trying to recover around GBP200 million
which he said Carillion was owed for work it had carried out, and
that this had been a key factor in the company's downfall, The
Telegraph relays.

But a spokesman for Msheireb Properties, as cited by The
Telegraph, said it had "reconciled all contractual payments with
Carillion".

"Despite ongoing project delay Msheireb Properties continued to
pay Carillion, however Carillion did not pass these funds onto
its supply chain, leaving over 40 sub-contractors unpaid," it
claimed, adding that this had caused it to "absorb significant
additional costs" because it had to pay Carillion's supply chain
directly, The Telegraph relates.

"Msheireb Properties intends to take all necessary steps to
recover the significant commercial shortfalls we have incurred
because of Carillion's default," The Telegraph quotes Msheireb
Properties as saying.

Gareth Rhys Williams, the civil servant in charge of commercial
procurement at the Cabinet Office, told the liaison committee
that the Government stood by its decision to award a major
contract for work on the High Speed Two rail line to Carillion
even after its financial problems came to light last July, The
Telegraph recounts.

He said Carillion had "passed all the tests" which the Government
ran on its private suppliers, which included assessing its
turnover and its ability to carry out the work, according to The
Telegraph.  He said the tests had been rerun following July's
profit warning and the Government was still satisfied that the
consortium appointed to carry out the work could continue, The
Telegraph notes.

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).


GRAINGER PLC: Fitch Raises Long-Term IDR to BB+, Outlook Stable
---------------------------------------------------------------
Fitch Ratings has upgraded the Long-Term Issuer Default Rating
(IDR) of Grainger Plc to 'BB+' from 'BB'. The Rating Outlook is
Stable. The rating of its senior secured notes has also been
upgraded to 'BBB-' from 'BB+'.

The rating action reflects the significant progress the company
has made towards increasing EBITDA generated by private rented
sector (PRS) assets, which is improving Grainger's business
profile by reducing the variability of its income. Unlike its
peers, Grainger's business model still relies on proceeds from
asset sales rather than on recurring rental income. Fitch views
reversionary disposal profits as more volatile than contracted
rental income, but Fitch acknowledge that in a large portfolio
the number of units released per year tends to be predictable.

The ratings reflect Grainger's position as the largest listed
residential property company in the UK with a GBP1.9 billion
wholly owned portfolio largely focused on London and the south-
east of England. The insufficient supply of housing in the UK and
the regulated portfolio's reversionary surplus, which provides
some downside price protection, supports the overall portfolio
valuation and rental demand.

KEY RATING DRIVERS

Further Progress on Transition: Grainger continues to progress
towards its goal of doubling rental income by 2020 through its
planned investments of GBP850 million. The large investment
pipeline, although positive for its business profile once
completed, carries some execution risk through capital
commitments, development risk in its direct developments, and
demand risk. At the end of the financial year to September 2017
(FYE17), the company had committed GBP651 million of PRS
investments, of which it had spent GBP218 million. An additional
GBP243 million of investments are in the planning or legal
stages.

Grainger's planned investments will more than double the number
of units in the wholly owned market rented portfolio. Grainger's
strong history of executing development projects is positive from
a credit perspective, and Fitch expects the limited supply of
housing in the UK to support rental demand for market-rented
properties.

Investments Drive Leverage: Fitch expect Grainger's investment in
PRS to gradually increase gross debt, despite being partly funded
by released capital from its portfolio of reversionary assets.
Fitch expects the LTV (including proportionally consolidated JVs)
to remain well within the rating sensitivities.

Fitch's assessment of Grainger's leverage is stricter than Fitch
LTV mid-point guideline for the 'BB' category, owing to its
reversionary assets, which Fitch view as potentially less liquid
than market-rented residential assets. As the proportion of
market rented assets increases, the composition of Grainger's
portfolio will better align with its higher rated peers.

High Rental Growth in FY17: Grainger exceeded Fitch's
expectations in FY17 with high net operating income (NOI) growth
of 8%, driven by 3.3% like-for-like rental growth in the PRS
portfolio and 4.3% in the regulated portfolio. Management further
reduced overhead costs by 14% yoy and improved its net rental
margin. There are signs of a slowdown in the general UK rental
market, particularly in London where growth decreased to 0.4% yoy
in December 2017 from 2.7% at end-September 2016, according to
the ONS index. Grainger outperformed this slowing market in 2017.

Improved Interest Coverage: Grainger improved its EBITDA net
interest cover (NIC) to 3.5x in FY17 from 2.0x in FY16 by
refinancing at reduced interest rates in 2017. This reduced the
average cost of debt from 4.4% to 3.5% and increased the average
debt maturity to 4.4 years (5.2 years including extension
options) from 3.1 years at FYE16.

Solid Asset Cover: Grainger's GBP275 million secured notes are
rated a notch higher than its IDR to reflect above-average
recovery expectations.

The secured notes benefit from a guarantor group providing a
floating charge over most of Grainger's UK residential portfolio,
which in turn corresponds to an asset cover of around 1.9x as of
September 2017 (asset cover is defined as the market value of
properties held by the secured notes core guarantors over core
gross debt facilities). According to Fitch's criteria, a decline
in asset cover to below 1.5x would lead to an alignment of the
secured rating with the IDR.

DERIVATION SUMMARY

Grainger Plc is positioned at 'BB+' below investment-grade UK
REIT peers, such as Hammerson plc (BBB+/RWN) and British Land
Company plc (BBB+/Positive), owing to a higher reliance on
reversionary income from asset sales rather than recurring rental
income. This more variable form of income offsets some of the
benefits of owning stable residential assets. Grainger's
financial position is strong, but Fitch expects its extensive
investment pipeline to increase leverage in the coming years.

KEY ASSUMPTIONS

Fitch's Key Assumptions Within Fitch Rating Case for the Issuer
- Low single-digit rental growth
- Annual vacancies of 6.5% on regulated tenancy portfolio
- Stable margin on regulated tenancy and tenanted sales
- Acquisitions and developments of around GBP600 million over
   the next three to five years

RATING SENSITIVITIES

Developments That May, Individually or Collectively, Lead to
Positive Rating Action
- Share of EBITDA generated by recurring rental income
  (including fees and other contractual income) sustainably above
   60%
- Fitch-adjusted LTV (proportionally consolidating the JVs)
   sustainably below 40%

Developments That May, Individually or Collectively, Lead to
Negative Rating Action
- Share of EBITDA generated by recurring rental income
(including
   fees and other contractual income) falling below 50% on a
   sustained basis
- Fitch-adjusted LTV (proportionally consolidating the JVs)
   increasing to above 55%
- A material reduction in recurring rental and contractual
   income resulting in EBITDA NIC below 1.75x on a consistent
   basis

LIQUIDITY

Comfortable Liquidity: Grainger had GBP78 million of readily
available cash and GBP219 million of an undrawn committed
revolver maturing in August 2022, with an option for a further
two-year extension. This liquidity is more than sufficient to
cover the limited short-term maturities occurring over the next
24 months. Fitch expect Grainger's development pipeline to be
funded through a combination of asset sales when regulated units
become vacant, retained operational cash flow and drawing down
existing facilities.


WORLDPAY GROUP: S&P Raises CCR to 'BB+' on Sale to Vantiv
---------------------------------------------------------
S&P Global Ratings said that it has raised its long-term
corporate credit ratings on U.K.-based payment processor Worldpay
Group Ltd. (previously Worldpay Group PLC) and Worldpay Finance
PLC to 'BB+' from 'BB'. The outlooks are negative.

S&P said, "At the same time, we raised our issue rating on the
outstanding EUR500 million unsecured notes issued by Worldpay
Finance to 'BB+' from 'BB'. The recovery rating of '3' reflects
our expectation of meaningful recovery prospects (rounded
estimate: 65%) in the event of a payment default.

"We are removing all the ratings from CreditWatch, where we
initially placed them with positive implications on July 17,
2017.

"The upgrades follow the completion of Vantiv's acquisition of
Worldpay on Jan. 16, and reflects our assessment of Worldpay as a
core subsidiary of Vantiv. As a result, we align our ratings and
outlook on Worldpay with those on Vantiv.

"In particular, the acquisition significantly furthers Vantiv's
strategy to attain international scale in providing access to
Worldpay's strong omni-channel presence in the U.K. and global e-
commerce payment platform. Worldpay represents about 40% of the
combined group's net revenue base and EBITDA.

"We also see further signs of a close link between Worldpay and
Vantiv. These include the change of the combined group's name and
brand to Worldpay, refinancing of most of Worldpay's debt with
new facilities and notes at Vantiv, dual listing on the New York
and London stock exchanges, and the combination of the two
entities' senior management teams, with their CEOs acting as co-
CEOs of the combined group.

"As a result, we think Vantiv is unlikely to sell Worldpay, since
it is a highly strategic asset and integral to its future
strategy. We believe Vantiv will support Worldpay under all
foreseeable circumstances. At the same time, because Vantiv
effectively controls Worldpay and its cash flows, we believe
Worldpay's credit quality is capped by that of the group, despite
the lower amount of debt that it now carries.

"Since we now equate our rating on Worldpay with that on Vantiv,
we will no longer analyze Worldpay's credit profile on a stand-
alone basis.

"Our negative outlook on Worldpay mirrors that on Vantiv."


===============
X X X X X X X X
===============


* BOOK REVIEW: The Rise and Fall of the Conglomerate Kings
----------------------------------------------------------
Author: Robert Sobel
Publisher: Beard Books
Softcover: 240 pages
List Price: $34.95
Review by David Henderson
Order your personal copy today at http://is.gd/1GZnJk

The marvelous thing about capitalism is that you, too, can be a
Master of the Universe. If you are of a certain age, you will
recall that is the name commandeered by Wall Street bond traders
in their Glory Days. Being one is a lot like surfing: you have to
catch the crest of the wave just right or you get slammed into
the drink, and even the ride never lasts forever. There are no
Endless Summers in the market.

This book is the behind-the-scenes story of the financial wizards
and bare-knuckled businessmen who created the conglomerates, the
glamorous multi-form companies that marked the high noon of
postWorld War II American capitalism. Covering the period from
the end of the war to 1983, the author explains why and how the
conglomerate movement originated, how it mushroomed, and what
caused its startling and rapid decline. Business historian Robert
Sobel chronicles the rise and fall of the first Masters of the
Universe in the U.S. and describes how the era gave rise to a
cadre of imaginative, bold, and often ruthless entrepreneurs who
took advantage of a buoyant stock market to create giant
enterprises, often through the exchange of overvalued paper for
real assets. He covers the likes of Royal Little (Textron), Text
Thornton (Litton Industries), James Ling (Ling-Temco-Vought),
Charles Bludhorn (Gulf & Western) and Harold Geneen (ITT). This
is a good read to put the recent boom and bust in a better
perspective.

While these men had vastly different personalities and processes,
they had a few things in common: ambition, the ability to seize
opportunities that others were too risk-averse to take, willing
bankers, and the expansive markets of the 1960s. There is
something about an expansive market that attracts and creates
Masters of the Universe. The Greek called it hubris.

The author tells a good joke to illustrate the successes and
failures of the period. It seems the young son of a
Conglomerateur brings home a stray mongrel dog. His father asks,
"How much do you think it's worth?" To which the boy replies, "At
least $30,000." The father gently tries to explain the market for
mongrel dogs, but the boy is undeterred and the next afternoon
proudly announces that he has sold the dog for $50,000. The
father is proudly flabbergasted, "You mean you found some fool
with that much money who paid you for that dog?" "Not exactly,"
the son replies, "I traded it for two $25,000 cats."
While it lasted, the conglomerate struggles were a great slugfest
to watch: the heads of giant corporations battling each other for
control of other corporations, and all of it free from the rubric
of "synergy." Nobody could pretend there was any synergy between
U.S. Steel and Marathon Oil. This was raw capitalist power at
work, not a bunch of fluffy dot.commies pretending to defy market
gravity.

History repeats itself, endlessly, because so few people study
history. The stagflation of the 1970s devalued the stock of
conglomerates and made it useless a currency to keep the schemes
afloat. The wave crashed and waiting on the horizon for the next
big wave: the LBO Masters of the 1980s.
Robert Sobel was born in 1931 and died in 1999. He was a prolific
chronicler of American business life, writing or editing more
than 50 books and hundreds of articles and corporate profiles. He
was a professor of business history at Hofstra University for 43
years and he a Ph.D. from NYU.



                            *********

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.


                 * * * End of Transmission * * *