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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, March 16, 2018, Vol. 19, No. 054


                            Headlines


F R A N C E

PAPREC HOLDING: Moody's Affirms B1 CFR, Outlook Stable
PAPREC HOLDING: S&P Affirms 'B+' ICR, Outlook Stable


G E R M A N Y

PROGROUP AG: Moody's Assigns Ba3 CFR, Outlook Stable
PROGROUP AG: S&P Affirms BB- Issuer Credit Rating, Outlook Stable


G R E E C E

GREECE: Economic Recovery Expected to Be Slow Amid Reform Delays


I R E L A N D

AIB GROUP: S&P Assigns 'BB+/B' ICRs, Outlook Positive
ALLIED IRISH: Moody's Rates Unit's Sr. Euro Note Programme (P)Ba2


K A Z A K H S T A N

LIFE INSURANCE: Fitch Assigns 'B' IFS Rating, Outlook Stable


L U X E M B O U R G

CRYSTAL ALMOND: Fitch Puts 'B' Secured Rating on Watch Negative


N E T H E R L A N D S

DECO 14: Fitch Affirms 'Csf' Ratings on 3 Tranches


N O R W A Y

AKER BP: S&P Affirms BB+ ICR & Rates New $500MM Notes 'BB+'


R U S S I A

O1 PROPERTIES: S&P Places 'B' ICR on Watch Neg. on Laysa Takeover
KREDIT EXPRESS: Put on Provisional Administration
WELLTON BANK: Bank of Russia Cancels License After Liquidation


S W E D E N

IF P&C: S&P Assigns BB+ Issue Rating to Restricted Tier 1 Notes
POLYGON AB: Fitch Assigns 'B' Long-Term IDR, Outlook Positive


U N I T E D   K I N G D O M

CO-OPERATIVE BANK: Draws Line Under Past, Posts Narrowing Losses
EG GROUP: Moody's Affirms B2 CFR, Outlook Stable
EG GROUP: Fitch Rates New Second Lien Debt 'CCC+(EXP)'
EG GROUP: S&P Alters Outlook to Negative & Affirms 'B' ICR
ELYSIUM HEALTHCARE: Moody's Assigns B3 CFR, Outlook Stable

TOYS R US: Fails to Find Buyer, All UK Stores Set to Close
TULLOW OIL: S&P Raises Long-Term ICR to 'B+', Outlook Stable


X X X X X X X X

* EU Commission Proposes New Measures for Banks with Bad Loans
* BOOK REVIEW: AS WE FORGIVE OUR DEBTORS


                            *********



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F R A N C E
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PAPREC HOLDING: Moody's Affirms B1 CFR, Outlook Stable
------------------------------------------------------
Moody's Investors Service has affirmed the B1 corporate family
rating (CFR) of French waste management and recycling company
Paprec Holding (Paprec), following the company's proposed
refinancing of its existing notes. In addition, Moody's has
downgraded Paprec's probability of default rating (PDR) to B1-PD
from Ba3-PD. At the same time, the agency assigned a B1 (LGD4)
rating to the proposed EUR800 million worth of senior secured
notes due 2025 (consisting of fixed and floating rate notes) to
be issued by Paprec Holding. The outlook on all ratings is
stable.

Paprec will use the proceeds from the proposed bond to (1) repay
the existing debt including the existing notes and the drawn
amounts under the RCF, and (2) pay fees, costs and expenses
incurred in connection with the refinancing transaction.

"The action reflects Moody's view that the proposed refinancing
will have marginal negative impact on leverage which is well
mitigated by the integration of Coved and the achieved synergies
so far in 2017," says Guillaume Leglise, a Moody's Assistant Vice
President - Analyst and lead analyst for Paprec. "The affirmation
also reflects Paprec's waste volume and earnings growth expected
in the next 18 months, thus supporting deleveraging going
forward," adds Mr Leglise.

RATINGS RATIONALE

RATIONALE FOR AFFIRMATION OF B1 CFR

The affirmation of Paprec's CFR at B1 reflects Moody's view that
the company's leverage post-closing of the transaction will be
high for the B1 rating category but that it will reduce over
time. The transaction involves incremental debt of EUR95 million
which mainly reflects the financing of two recent acquisitions,
Ikos and Nord, for around EUR60 million. At closing of the
refinancing and pro forma for the acquisition of Coved, Moody's
estimates that the company's leverage ratio (defined as gross
Debt/EBITDA with Moody's adjustments) will stand at around 5.8x
at end-December 2017, compared to an estimated 5.3x without the
refinancing.

Moody's expects Paprec's leverage ratio will trend towards 5.0x
over the next 12 to 18 months notably through profitability
improvement on the back of continued growth in waste volume
serviced and achievement of synergies from Coved and other recent
acquisitions. Also, as part of this transaction, the company will
improve its interest coverage, which has been weak historically,
with EBIT to interest expenses (as adjusted by Moody's) at around
1.0x in 2017. This ratio will trend towards 1.5x in the next 18
months thanks to the lower coupon expected to be achieved on the
new notes as well as profitability improvement.

The affirmation is also supported by the ongoing integration of
Coved, which enhances the company's scale and business mix and
diversification towards municipal waste management services.
Coved, a former subsidiary of French water company SAUR, is a
national waste management generalist company with established
market positions along the waste management value chain and with
a strong focus on French municipalities. Coved's municipal waste
management activities present a lower risk profile and enhance
Paprec's revenues stability and visibility owing to the typical
medium term nature of the contracts. Since the acquisition in
April 2017, the integration of Coved has so far been successful
and the achievement of synergies are well on track. Moody's
estimates that the remaining synergies are reasonably achievable,
and should be completed in the next 18 months.

Paprec's B1 CFR also incorporates (1) the company's comprehensive
offering of recycling services and its diversified and growing
customer portfolio; (2) its well-spread network of processing and
recycling sites across the French territory, which creates
barriers to entry; (3) the positive long-term trends of the
recycling industry, which support Paprec's volume growth; and (4)
the resilient margins that the company is able to achieve through
protective clauses in its waste collection contracts, despite
volatile raw material price fluctuations.

However, Paprec's CFR remains constrained by (1) its dependence
on the economic and regulatory environment in France (96% of
sales) which lags other European countries regarding transition
towards more recycling; (2) some exposure to landfill activities
which carry some environmental and reputational risks and are
under intense regulatory scrutiny; (3) some residual exposure to
fluctuations in raw materials prices (e.g. metals); and (4) the
capital intensive nature of the industry which requires regular
capex investments.

Pro forma for the proposed transaction, Paprec will present a
sound liquidity profile with around EUR113 million of cash on
balance sheet. Paprec will also double the size of its covenanted
revolving credit facility (RCF) to EUR200 million, which was only
drawn occasionally in the past. Moody's assessment of Paprec's
liquidity also factors in an expected positive free cash flow of
around EUR40-50 million in the next 12 to 18 months, after cash
interests, maintenance capex requirements, additional capex
development anticipated for Coved in 2018, and even when assuming
continued investments in small bolt-on acquisitions, as seen in
the past.

RATIONALE FOR PDR DOWNGRADE

The downgrade of Paprec's PDR to B1-PD from Ba3-PD, reflects
Moody's use of an average family recovery level of 50% reflecting
a capital structure with a mix of notes and bank debt. As part of
the proposed debt refinancing, Paprec will double the size of its
RCF to EUR200 million. Despite the covenant lite package with
only a springing covenant on the RCF protecting creditors, the
use of a 50% recovery rate reflects the significant size of the
RCF in the new capital structure.

STRUCTURAL CONSIDERATIONS

Paprec's B1 CFR is assigned at the holding company level. The
contemplated debt structure comprises a EUR800 million senior
secured bond and a EUR200m super senior RCF, all of which are
issued at the same holding level. Although the senior secured
notes rank pari passu with the RCF, the RCF has priority in case
of collateral enforcement. The B1 rating assigned to Paprec's
proposed bond is in line with the company's B1 CFR and reflects
the relative ranking of its senior secured notes as set out in
the intercreditor agreement, whereby the notes are contractually
subordinated to the RCF with respect to the collateral
enforcement proceeds.

The notes and the super senior RCF benefit from the same
guarantor package including upstream guarantees from some of
Paprec's operating companies (excluding Coved), representing
around 55% of the company's EBITDA. Both the senior secured notes
and the RCF are secured, on a first-priority basis, by the same
collateral, essentially comprising pledges on stock, bank
accounts and intercompany receivables of a number of Paprec's
operating companies.

The capital structure has limited covenants because the lenders
are relying only on the incurrence covenants contained in the
senior secured notes indentures, as well as on one maintenance
covenant defined as super senior net leverage, with ample
capacity at the time of the transaction. This covenant will be
tested on a semi-annual basis only if RCF outstandings are equal
to or greater than 50% of the overall commitment.

RATIONALE FOR STABLE OUTLOOK

The outlook on Paprec's ratings is stable and reflects Moody's
expectations that the company will continue to improve its
financial profile in the next 12 to 18 months to levels more
comfortable for the B1 rating category. Moody's expects the
continuing growth of recycled waste volumes to increase the
company's capacity usage and improve its profitability, such that
Paprec's leverage (defined as Moody's-adjusted gross debt/EBITDA)
will trend below 5.5x in the next 12 to 18 months.

WHAT COULD CHANGE THE RATING UP/DOWN

Upward pressure on Paprec's B1 CFR could develop if leverage
(i.e., gross debt/EBITDA including Moody's adjustments) reduces
towards 4.5x and EBIT/interest expense increases towards 2x. At
the same time, Moody's would expect the group to maintain a
positive free cash flow generation and an adequate liquidity
profile.

Downward pressure on Paprec's B1 CFR could develop if leverage is
sustainably above 5.5x; if free cash flow generation turns
negative over a prolonged period of time; or if its liquidity
profile weakens.

PRINCIPAL METHODOLOGY

The principal methodology used in these ratings was Environmental
Services and Waste Management Companies published in June 2014.

Headquartered in Paris, France, Paprec is a pure-play integrated
recycling company, mainly focused on the collection and
transformation of non-hazardous waste from private and municipal
entities, which are sold as secondary raw materials. In 2017, pro
forma for the acquisition of Coved, the company reported revenues
of EUR1.4 billion and EBITDA of EUR167.7 million.

Paprec was founded in 1984 and bought in 1994 by Jean-Luc
Petithuguenin, who remains the current CEO of the company. Mr
Petithuguenin is also the majority shareholder with 57% of the
share capital, the rest being owned by BPI France Participation
(33.5%), the investment-bank arm of French State, and a
consortium of French banks and institutional shareholders (9.5%).


PAPREC HOLDING: S&P Affirms 'B+' ICR, Outlook Stable
----------------------------------------------------
S&P Global Ratings affirmed its 'B+' issuer credit rating on
France-based waste recycling company Paprec Holding. The outlook
remains stable.

S&P said, "At the same time, we assigned our 'B+' issue rating
and '4' recovery rating to the proposed EUR800 million new senior
secured notes. The '4' recovery rating indicates our expectation
of average (30%-50%, rounded estimate 35%) recovery prospects in
the event of a default.

"We also assigned our 'BB' issue rating and '1' recovery rating
to the proposed EUR200 million super senior revolving credit
facility (RCF). The '1' recovery rating indicates our expectation
of very high (90%-100%; rounded estimate 95%) recovery prospects
in the event of a default.

"In addition, we affirmed our issue ratings on all the group's
existing (before the refinancing) debt instruments: the 'BB'
issue rating (with a recovery rating of '1') on the EUR100
million super senior RCF; the 'B+' issue rating (with a recovery
rating of '3') on the EUR520 million senior secured notes due
2022; and the 'B-' issue rating (with a recovery rating of '6')
on the EUR185 million subordinated notes due 2023. We will
withdraw these issue and recovery ratings once the refinancing is
completed."

The affirmation follows Paprec's announcement that it intends to
issue EUR800 million seven-year senior secured notes to refinance
its existing debt structure in full. This includes repayment of
the outstanding EUR520 million senior secured notes, EUR185
million subordinated notes, EUR60 million drawings under the RCF,
and about EUR35 million in call premium and transaction costs.
The transaction will enable the company to extend its debt
maturity profile and simplify its debt structure. It will also
moderately reduce interest costs, since it will replace
relatively expensive senior subordinated notes by an increased
amount of senior secured debt. In addition, Paprec is raising a
new six-year RCF with a commitment of EUR200 million, compared
with EUR100 million previously, thus improving the liquidity
profile.

Following the acquisition of Coved, completed in April 2017, as
well as a few other bolt-on acquisitions, Paprec marginally
outperformed our expectations, and achieved revenue of EUR1.3
billion and S&P adjusted EBITDA of EUR161.0 million in 2017. As
expected, the acquisition enabled the group to enhance its
national coverage, given Coved's dense network of waste sorting
centers, waste collection depots, and landfills, which helped to
improve the group's scale and market shares in France.
Furthermore, Coved provides enhanced customer diversification and
revenue predictability, thanks to its focus on public customers,
who tend to engage in longer term contracts. In addition, the
group is also on track to achieve the anticipated synergies from
the acquisition, which will result in further improvements in
EBITDA margins in the coming years. This includes synergies from
the consolidation of office locations, information technology
savings, and an improved utilization rate of Coved-owned
landfills, which were previously underused.

S&P said, "Although the group has grown slightly in size and
enjoys a strong position in the French waste recycling market, we
still view its almost exclusive focus on France and relatively
limited scale as a weakness, compared with larger and
internationally diversified players, such as Veolia and Suez
Environment. In addition, we expect that Paprec will continue to
generate about 45% of revenues from the sale of raw materials
from recycling, which we view as more volatile than collection
and sorting of household and industrial waste." This is because
the sale of raw materials may be subject to price volatility,
depending on the global supply-and-demand balance. For instance,
Paprec's largest segment in terms of volumes, the recycled paper
market, was negatively affected by China's decision to impose
restrictions on imports of waste paper and cardboard, resulting
in the global price index losing about 20% since July 2017.
Paprec is also exposed to particularly volatile segments such as
scrap or nonferrous materials, where the group does not benefit
from indexation clauses.

S&P said, "Although improving, our overall assessment of Paprec's
creditworthiness remains constrained by the group's financial
risk profile, with estimated adjusted debt to EBITDA of about
5.1x at year-end 2018, falling to about 4.5x-5.0x in 2019, thanks
to increased EBITDA generation, expected continued volume growth,
and contribution from acquisitions. We expect the group will
continue to generate positive free operating cash flow (FOCF) and
will benefit from stronger interest cash coverage metrics
following the refinancing transaction.

"The stable outlook reflects our view that Paprec will deliver
strong revenue and EBITDA growth in the next 12 months, owing to
strong growth in waste volumes, stable prices, and full-year
contribution from Coved and from new acquired assets. This also
reflects our expectation of a marginal improvement in
profitability, supported by synergies. This will result in
adjusted debt to EBITDA improving to 5.1x by the end of 2018 and
further reducing materially below 5.0x in 2019.

"We could consider a negative rating action if we observed a
material weakening in the group's operating performance,
resulting, for instance, from a sharp decrease in raw material
prices or significantly lower waste volumes than anticipated,
resulting in adjusted leverage deteriorating to above 6.0x. In
addition, the rating would come under pressure if FFO cash
interest coverage deteriorated to below 2.5x, or if FOCF fell
significantly as a result of higher working capital needs or
higher capex than anticipated. We could also take a negative
rating action if the group attempted a significant debt-funded
acquisition, or undertook material shareholder distributions, or
if our liquidity assessment weakened.

"We could raise the rating on Paprec if we observed that the
group's cash flow and leverage metrics had improved beyond our
expectations, as a result of stronger revenue growth and higher
EBITDA generation than we anticipated. Specifically, we could
raise the rating if Paprec improved its adjusted debt to EBITDA
ratio to below 4.5x, combined with FFO cash interest coverage
sustainably above 3.5x."


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G E R M A N Y
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PROGROUP AG: Moody's Assigns Ba3 CFR, Outlook Stable
----------------------------------------------------
Moody's Investors Service has assigned a Ba3 corporate family
rating (CFR) and a Ba3-PD probability of default (PDR) to
Progroup AG (Progroup). In addition, it has also assigned a Ba3
rating to the proposed EUR450 million senior secured notes and
affirmed the Ba3 rating of the EUR150 million senior secured
notes issued by Progroup last year. The outlook on the ratings is
stable.

Concurrently, Moody's has withdrawn a Ba3 CFR and a Ba3-PD PDR of
JH-Holding GmbH (JH-Holding), a holding entity owning Progroup
AG, that had stable outlook. Moody's expects to withdraw the B2
rating of the outstanding EUR125 million subordinate PIK toggle
notes issued by JH-Holding Finance SA, a subsidiary guaranteed by
JH-Holding GmbH, as well as the Ba3 rating of the EUR345 million
senior secured notes issued by Progroup AG, once the refinancing
transaction is successfully closed and these instruments are
fully redeemed.

RATINGS RATIONALE

RATIONALE FOR CFR

The reassignment of the CFR to Progroup AG from JH-Holding GmbH
is prompted by a transaction announced on 12 March, in which
Progroup raises EUR450 million notes largely to repay the EUR345
million notes issued by Progroup AG and all the outstanding PIK
toggle notes at JH-Holding GmbH (roughly EUR80 million). After
the refinancing JH-Holding will have no outstanding debt and will
cease to publish its results, which drives the reassignment.

Progroup's Ba3 CFR, in line with the level of former JH-Holding's
CFR, reflects the fact the refinancing will have no material
impact on the ratings, given that it will not meaningfully change
the overall amount of gross debt. However, it is credit positive,
because it is likely to substantially reduce the overall interest
bill and prolong the debt maturity profile. The rating agency
expects that the interest on the new notes will be below the
interest on Progroup's EUR345 million notes (5.125%) and
significantly below the interest in the PIK toggle notes issued
by JH-Holding (8.25%).

Following a strong finish in the last year, based on preliminary
financials Moody's estimates that Progroup ended the fiscal year
2017 with credit metrics that position it strongly in the Ba3
category, such as EBITDA margin of around 23%, gross debt/EBITDA
around 3.5x and RCF/debt around 17% (all as adjusted by Moody's),
and with a strong cash buffer, reporting roughly EUR120 million
of cash and cash equivalents as of end-December 2017. This leaves
Progroup with sizeable headroom for operational underperformance
as well as debt-funded growth.

Moody's sees a risk of at least a temporary increase in
Progroup's leverage in the next three to four years. To benefit
from the good growth in its markets Progroup is considering
building four new corrugated plants in Europe, aiming to increase
the annual capacity to 4,200 million m2 from 3,000 million m2
currently. Given that during 2018 Progroup will already become a
net purchaser of recycled containerboard, the company is also
looking into an option to build a containerboard mill with an
annual capacity of 750,000 tonnes with estimated costs of EUR375
million. These sizeable investments are likely to be at least
partially debt financed, which could put Progroup's leverage
under pressure, especially at times when the new capacity will be
ramping up, thereby diluting margins, which are currently among
the strongest in the paper-packaging industry.

However, the rating agency believes that Progroup's Moody's
adjusted debt/EBITDA will unlikely increase sustainably over 4.0x
should the company pursue its expansion plans, which is still
well in line with a Ba3 rating. Progroup has built a track record
of deleveraging in the past, both through EBITDA expansion, but
also through actual debt repayments from cash flow generation,
which benefits from high profitability, fairly low maintenance
capex needs (roughly 2% of sales) and no dividend payments to the
family owners, whom Moody's expect to continue being supportive.
Also, Progroup's commitment to keep its reported net leverage in
the range of 2.5-3.0x (2.8x for the fiscal year 2017) in medium
term indicates the company's willingness to deleverage if needed.

RATIONALE FOR STABLE OUTLOOK

The stable outlook on the ratings reflects the rating agency's
expectation that Progroup will be able to keep Moody's adjusted
EBITDA margins at around 20% and Moody's adjusted debt/EBITDA
largely below 4.0x even at times of envisaged capacity expansion.

RATIONALE FOR PDR AND INSTRUMENTS RATING

The Ba3-PD, in line with CFR, reflects the rating agency's
standard assumption of 50% family recovery rate, given that the
liability structure contains both bank debt and bonds. The senior
secured notes issued by Progroup AG are rated Ba3, in line with
the CFR. This is primarily because senior secured debt
constitutes the vast majority of the outstanding liabilities and
there is only a EUR50 million super senior revolving facility
that ranks ahead of the bonds in Moody's loss given default
waterfall. The size of the facility is too small to cause the
notching of the bonds below the CFR. The guarantor pool is strong
consisting of all material subsidiaries representing 93% of
revenues, 98% of EBITDA and 98% of assets. The notes are secured
by first-ranking liens over the shares of the issuer, certain
real property, certain bank accounts and certain fixed and other
assets.

LIST OF AFFECTED RATINGS

Issuer: JH-Holding GmbH

Withdrawals:

-- Long-term Corporate Family Rating, previously rated Ba3

-- Probability of Default Rating, previously rated Ba3-PD

Outlook Action:

-- Outlook changed to Rating Withdrawn from Stable

Issuer: Progroup AG

Assignments:

-- Long-term Corporate Family Rating, assigned Ba3

-- Probability of Default Rating, assigned Ba3-PD

-- Senior Secured Regular Bond/Debenture, assigned Ba3

Affirmation:

-- Senior Secured Regular Bond/Debenture, affirmed Ba3

Outlook Action:

-- Outlook remains Stable

The principal methodology used in these ratings was Paper and
Forest Products Industry published in March 2018.

Headquartered in Landau, Germany, with sales of around EUR800
million in 2017, Progroup is one of the leading European paper-
based packaging companies, focusing on the production of
containerboard, primarily testliner and fluting, and its
conversion into corrugated board. The company owns two
containerboard mills and 10 corrugated board plants (additional
one is under construction) across five European countries, as
well as one combined heat and power plant (CHP) in
EisenhÅttenstadt, Germany, employing a workforce of around 1,100
employees. The company is family owned and Juergen Heindl, who
founded Progroup in 1992, is its CEO.


PROGROUP AG: S&P Affirms BB- Issuer Credit Rating, Outlook Stable
-----------------------------------------------------------------
S&P Global Ratings said that it had affirmed its 'BB-' long-term
issuer credit ratings on Germany-based containerboard and
corrugated board producer Progroup AG and JH-Holding Finance
S.A., a financing subsidiary of Progroup's holding company, JH-
Holding GmbH. The outlooks on both ratings are stable.

S&P said, "At the same time, we affirmed the 'BB-' issue rating
on the outstanding EUR150 million floating-rate notes due 2024
and the EUR345 million fixed-rate notes due 2022. The recovery
rating on these notes remains at '3', reflecting our expectation
of meaningful recovery of 50%-70% (rounded estimate: 50%) in the
event of a payment default.

"We also assigned a recovery rating of '3' and issue ratings of
'BB-' to Progroup's proposed EUR450 million senior secured notes
due 2026. The recovery rating of '3' reflects our expectation of
meaningful recovery of 50%-70% (rounded estimate: 50%) in the
event of a payment default.

"In addition, we affirmed our 'B' issue rating on the EUR81
million payment-in-kind (PIK) toggle notes due 2022 issued by JH-
Holding Finance. The recovery rating remains '6', reflecting our
expectation of negligible (0%-10%; rounded estimate: 0%) recovery
in the event of a payment default.

"We will withdraw our recovery and issue ratings on the EUR345
million senior secured notes and EUR81 million subordinated PIK
toggle notes and our issuer credit rating on JH-Holding Finance
upon completion of the refinancing transaction."

The affirmation follows Progroup's announcement that it intends
to issue EUR450 million of senior secured notes. The company will
use the proceeds to redeem its outstanding EUR345 million senior
secured notes and EUR81 million subordinated PIK toggle notes.

S&P said, "We still regard Progroup's financial risk profile as
significant despite an expected increase in capital expenditure
(capex). While this is expected to benefit sales and EBITDA in
the medium term, these investments will undermine free cash flow
generation until 2021. Although we expect credit metrics to
improve in 2018, with funds from operations (FFO) to debt of 25%
versus 22.8% in 2017, they will deteriorate slightly from 2019
onward (FFO to debt to approximately 20%) due to higher
expansionary capex. Cash on the balance sheet and debt will fund
this capex."

To meet the growing demand, Progroup plans to build a
containerboard mill in Germany (PM3) and four corrugated
sheetboard plants in Central Europe by 2021. Although these plans
are still at a preliminary stage, S&P reflected these capex
outlays in our projections. The company would not pursue these
investments if market conditions changed materially. The PM3 mill
would add capacity of 750,000 tons and allow the company to
significantly increase its containerboard capacity.

Progroup started production at its corrugated sheetboard plant in
Italy (additional capacity of 100,000 tons) in early March 2018,
and expects to finalize the construction of a corrugated
sheetboard plant in the U.K. (additional capacity of 200,000
tons) in the third quarter of 2018 before ramping up to full
capacity in subsequent years.

Although these expansion plans somewhat augment Progroup's scale,
market share, and asset diversity over the long term, there are
associated execution and timing risks until these facilities are
fully ramped up and running. However, Progroup's historical
expertise in developing greenfield projects somewhat mitigates
our concerns. These growth investments are subject to favorable
market conditions and will be withdrawn in case of deteriorating
pricing or overcapacity in the containerboard market.

S&P said, "That said, we still think that Progroup's position as
a relatively small player in the fragmented, commodity-like, and
highly competitive European container and corrugated board market
constrains its business risk profile. Progroup generates annual
sales of EUR800 million. With two containerboard plants and 10
corrugated board plants (following recent investments in the U.K.
and Italy), its asset base is relatively concentrated. This
concentration exacerbates its vulnerability to unexpected plant
shutdowns, particularly in the containerboard segment, as
exemplified by the extended shutdown of the combined heat and
power plant in 2016. Progroup's focus on corrugated sheets, well-
invested asset base, and efficient cost structure partly mitigate
these factors. The company has historically generated relatively
strong EBITDA through the business cycle. The group has well-
established relations with small and midsize Central European
corrugated box makers. Its customer and supplier concentration is
limited.

"We consider Progroup's financial risk profile to be at the
weaker end of our significant category. This, combined with
execution risks related to the upcoming capacity expansions and
Progroup's small size and scope led us to deduct one notch from
the anchor of 'bb' to arrive at the final rating of 'BB-'.

"The stable outlook reflects our expectation that Progroup's
credit metrics will be supported by favorable market conditions
for corrugated board. We do not expect them to deteriorate
significantly from current levels despite the company's expansion
plans. We forecast the company will maintain FFO to debt in
excess of 20% from 2018 onward. We believe that the company will
generate negative free cash flow from 2019 because of
expansionary capex plans.

"We could downgrade Progroup if its operational performance
deteriorated significantly. This could be the result of an
extended period of severe pricing pressure in the containerboard
and corrugated board markets caused by excess supply. It could
also result from an unexpected outage at one of its
containerboard mills, or cost overruns related to its expansion
investments. We would view a ratio of FFO to debt of below 16%
and debt to EBITDA of above 4.5x as commensurate with a lower
rating.

"We could raise the ratings if Progroup's financial risk profile
improved, with FFO to debt above 25% and debt to EBITDA improving
to 3.0x on a sustainable basis. We view such a scenario as
unlikely, given the expected investments in new plants."


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G R E E C E
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GREECE: Economic Recovery Expected to Be Slow Amid Reform Delays
----------------------------------------------------------------
Phyllis Papadavid at Bloomberg News reports that Greece's planned
August exit from its third European Stability Mechanism bailout
has triggered investor optimism.  Its July 2017 bond issuance,
the first in three years, was oversubscribed, as were subsequent
issuances in February of this year, Bloomberg notes.

And yet financial investors should curb their optimism, Bloomberg
states.  Greece's return to the markets, and its economic
recovery, are likely to be a bumpy and slow -- especially if it
continues to delay key reforms, according to Bloomberg.

Lack of clarity over debt relief will ultimately mean a costly
re-entry into financial markets, Bloomberg says.  Greece's key
borrowing costs will be a function of what kind of debt relief
Greece receives from its creditors, Bloomberg discloses.  The
prospects don't look promising, Bloomberg states.  Europe is
unlikely to agree to significant debt forgiveness as it will want
to ensure that Greece's over-borrowing does not repeat elsewhere
in the euro zone, according to Bloomberg.  With a 176% debt-to-
GDP ratio, and little prospects for growth acceleration or
healthy capital inflows, investing in Greece is not for the faint
of heart, Bloomberg notes.

The recent effort to reduce Greece's non-performing loans is a
silver lining to this picture, Bloomberg says.  At the Bank of
Greece's recent annual general meeting, there was discussion of
forming a "bad bank" to consolidate bad loans, Bloomberg relays.
According to Bloomberg, such a model has worked elsewhere,
including in Spain, where despite its losses, Sareb bank was
instrumental in reducing bad loans and stabilizing its financial
sector.  A bad bank in Greece could boost banks' capacity to
provide liquidity through renewed lending, which would be crucial
for investment -- particularly for Greece's small businesses,
which account for 90% of non-financial employment, Bloomberg
says, citing the European Commission.

Despite progress with its primary fiscal targets and NPLs, rent-
seeking and clientelism are still a feature of policymaking in
Greece, Bloomberg discloses.

When Greece exits its bailout in a few months it will have to
contend with faltering growth, rebuilding its banking system, and
invigorating a reform agenda that uproots its public sector for
the sake of a more competitive economy, driven by investment and
trade rather than government spending and EU handouts, according
to Bloomberg.  In the absence of this, it will face unfavorable
financing conditions and perhaps even worse, another lost decade,
Bloomberg states.


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


AIB GROUP: S&P Assigns 'BB+/B' ICRs, Outlook Positive
-----------------------------------------------------
S&P Global Ratings assigned its 'BB+/B' long- and short-term
issuer credit ratings (ICRs) to Ireland-based nonoperating
holding company AIB Group PLC (the NOHC). The outlook is
positive.

The rating reflects the NOHC's position as the immediate parent
of Allied Irish Banks PLC (AIB), a leading Irish bank, as well as
S&P's view of the group's creditworthiness, which is constrained
by the structural subordination of the NOHC's creditors.

AIB recently completed a corporate reorganization that led to the
creation of AIB Group PLC as the group's listed holding company.
As the NOHC, it consolidates AIB, which is the principal
operating subsidiary, representing 100% of the group's total
assets. The group's only investment is its stake in AIB, and
there is no double leverage at the NOHC. S&P expects the NOHC to
downstream issued debt and equity capital to its operating
subsidiary and that, over time, it will become a key vehicle for
the group's issuance of long-term instruments designed to absorb
losses, whether on a going-concern or nonviability basis.

S&P said, "Because we regard AIB Group PLC as a NOHC, we do not
assign it a group status, as we would for an operating
subsidiary. Rather, the starting point for the ICR on the NOHC is
based on AIB's group credit profile (GCP), which we assess at
'bbb-'. We set the ICR on the NOHC one notch below the GCP,
reflecting the structural subordination of the NOHC's creditors--
in other words, our view of incrementally higher credit risk for
the NOHC relative to its principal operating bank, AIB.

"The ratings on both the NOHC and AIB do not benefit from any
external support, notably under our additional loss-absorbing
capacity (ALAC) criteria. In time, it is possible that we could
revise this stance, for example, if it becomes clear that the
group will build a sizable buffer of loss-absorbing capacity
designed to enable a recapitalization rather than a liquidation
if it becomes nonviable. However, even if we included such
uplift, this would benefit only the ratings on AIB (which
undertakes the systemically important functions), not the NOHC
(which could well default in such a scenario). This approach
would be consistent with the one we take for other banking group
NOHCs, for example in the U.K., the U.S., and Switzerland."

AIB GROUP PLC

S&P said, "The positive outlook on AIB Group PLC reflects that we
may improve our view of Irish banking industry risk over our two-
year outlook horizon. This could lead us to revise upward our
assessment of the unsupported GCP by one notch to 'bbb', and
therefore raise the ratings.

"While less likely in the short term, we could also revise our
view of the unsupported GCP upward if the group continued to make
steady progress in reducing its stock of nonperforming assets,
such that its asset quality metrics improved to levels more
aligned with those of peers in the coming 18-24 months.

"We could revise the outlook to stable if our view of Ireland's
banking industry risk worsened. We could also revise the outlook
to stable if the group's capital management became more
aggressive as it gradually returns to full private ownership,
such that we no longer believed its risk-adjusted capital ratio
would sustainably exceed 10%."

ALLIED IRISH BANK PLC

S&P said, "The positive outlook on AIB, the primary operating
company of the group, mirrors that on the NOHC. Accordingly, we
could lower or raise the ratings if we revised our assessment of
the unsupported GCP upward or downward, as explained above.

"We could also raise the ratings on AIB if we included one notch
of uplift for ALAC support in the long-term rating on the bank.
This depends on the bank's issuance plans regarding the minimum
requirement for own funds and eligible liabilities. In addition,
the bank's ALAC buffer would need to exceed our threshold of 5%
for a bank with an anchor of 'bbb-' or higher. ALAC support would
only benefit the ratings on the operating company, AIB, because
we do not include notches for ALAC support in our long-term
rating on NOHCs."


ALLIED IRISH: Moody's Rates Unit's Sr. Euro Note Programme (P)Ba2
-----------------------------------------------------------------
Moody's Investors Service affirmed all ratings on Allied Irish
Banks, p.l.c. (AIB) and assigned a provisional (P) Ba2 rating to
the senior unsecured Euro Medium Term Note Programme of the
bank's holding company, AIB Group plc (AIB Group). The agency
changed the outlook on the long-term ratings to positive from
stable. As part of the same action, Moody's affirmed all ratings
of EBS d.a.c. (EBS) and changed the outlook on the long-term
ratings to positive from stable.

The assignment of provisional ratings to AIB Group follows the
entity's establishment as the holding company of AIB in December
2017. This corporate restructuring will allow AIB to comply with
the resolution authorities' requirements under the EU Bank
Recovery and Resolution Directive (BRRD) framework: as the Single
Resolution Board's preferred resolution strategy for AIB is a so-
called "single point of entry", AIB Group will become the primary
issuer of external capital and debt securities issued to meet the
group's minimum requirement for own funds and eligible
liabilities (MREL).

Moody's issues provisional ratings in advance of the final sale
of securities. These ratings represent the rating agency's
preliminary credit opinion. A definitive rating may differ from a
provisional rating if the terms and conditions of the final
issuance are materially different from those of the draft
prospectus reviewed.

The positive outlooks assigned to AIB's senior unsecured and
deposit ratings reflect both (i) AIB's on-going improvement in
asset quality, which could lead to an upgrade of the bank's
baseline credit assessment (BCA) of ba1 over the outlook period;
and (ii) a potential reduction in loss-given-failure for deposits
and senior debt given the additional protection provided by debt
securities to be issued by AIB Group.

RATINGS RATIONALE

AIB and AIB Group

BCA

The affirmation of AIB's BCA of ba1 reflects the bank's good
level of capitalization, strong profitability, and sound funding
and liquidity profile. It also takes into account the remaining
large stock of non-performing loans, significant performing but
restructured exposures, and likely increase in market funding
reliance as MREL rules come into force Moody's believes there is
now potential upside to the BCA given the further improvements in
asset quality achieved in 2017. While AIB was severely hit during
the financial crisis, its efforts in restoring its balance sheet
have been significant in terms of loan deleveraging (gross loans
declined by 35% between 2011 and 2017), while impaired loans have
been reduced dramatically from the peak of EUR28.9 billion at
year-end 2013, largely due to the restructuring of the non-retail
legacy exposures. The improvement continued at steady pace in
2017, with impaired loans falling by 31% to EUR6.3 billion at
December 2017 from EUR9.1 billion at December 2016, due to a
combination of restructuring, portfolio sales, write-offs and
repayments.

As for other Irish domestic banks, Moody's expect that AIB's
legacy portfolio of residential mortgages will require a long
time to wind down, given the current low level of repossessions
by banks, which the agency does not expect to materially change
in the near term. These concerns are however partially mitigated
by the ongoing restructuring activity and the improving economic
conditions, which led to a decrease in impaired loans from EUR4.6
billion at end-2016 to EUR3.3 billion at end-2017, while the
proportion of Irish mortgages in negative equity decreased to 10%
at end-2017 from 20% a year previously.

While AIB still holds material amounts of restructured loans on
its balance sheet, which have an increased probability of default
in case of macro-economic headwinds, the trend has been similarly
positive in 2017 with loans categorised as vulnerable or past due
(but not impaired) reducing by 15%.

The rating agency will monitor over the outlook period AIB's
ability to further reduce the impaired loan portfolio in line
with the expected rate of decline.

LONG-TERM RATINGS

The affirmation of AIB's long-term senior unsecured debt and
deposit ratings at Baa2 and Baa1, respectively, include the
uplift resulting from Moody's Advanced Loss Given Failure (LGF)
analysis. The senior unsecured debt and deposit ratings continue
to benefit from one notch and two notches of uplift respectively,
given their different weights in the bank's liability structure.
In addition, the long-term ratings incorporate one notch of
government support, which also remains unchanged, reflecting a
moderate probability of government support for AIB's senior
unsecured creditors and wholesale deposits, should the bank fail.

The (P) Ba2 rating assigned to the senior unsecured programme of
AIB Group reflects the rating agency's expectation that the debt
class is likely to face high loss-given-failure due to the
limited loss absorption provided by its own modest volume and the
amount of debt subordinated to it.

For holding company instruments, which are meant to absorb losses
in resolution, Moody's believes that the potential for government
support is therefore low and hence these ratings do not include
any related uplift.

The positive outlooks on AIB's long-term deposit and senior
unsecured debt ratings reflect AIB's expected issuance plans
given its informative MREL target of 29.05% of RWAs. When
confirmed, this would provide additional protection for the
bank's senior unsecured debt and deposits, and for the holding
company's senior unsecured debt, and could lead to higher ratings
over the outlook horizon.

CR Assessment (CRA)

The bank's long-term CRA of A3(cr) benefits from three notches of
uplift under the LGF analysis, given significant volume of
subordinated debt, senior debt and wholesale deposits, and one
notch of government support.

WHAT COULD MOVE THE RATINGS UP/DOWN

AIB's long-term debt and deposit ratings could be upgraded as a
result of (1) an upgrade in its standalone BCA; or (2) a
significant increase in the bank's bail-in-able debt. The bank's
BCA could be upgraded because of (1) a further reduction in non-
performing loans; (2) an improvement in stressed-capital
resilience above Moody's expectations; or (3) a sustained
improvement in core profitability.

AIB's ratings could be downgraded as a result of (1) a downgrade
in its standalone BCA; or (2) redemption of maturing subordinated
instruments without their replacement. AIB's BCA could be
downgraded because of (1) a significant deterioration in the
bank's asset risk metrics; (2) a weakening of its solvency
profile; or (3) a worsening of its core profitability ratios.

EBS

The affirmation of the ratings of EBS was driven by the
affirmation of AIB's ratings. EBS's BCA is fully aligned with the
BCA of AIB.

Moody's alignment of the bank's BCA with that of its parent is
driven by its high degree of integration with AIB. EBS is managed
as a business division of AIB, with treasury, risk management and
middle and back office functions centralised at AIB. As a result,
Moody's does not believe that EBS's standalone financial metrics
provide meaningful indicators of creditworthiness, and considers
it to be highly integrated and harmonized with AIB.

EBS's Baa1 long-term deposit ratings are also aligned with those
of AIB. Moody's believes that EBS, as a domestic subsidiary of an
Irish banking group, would be resolved together with AIB in the
event of their failure. This means that, like those of AIB, EBS's
deposits are likely to face very low loss-given-failure according
to the agency's LGF analysis, resulting in a two-notch uplift in
its deposit ratings relative to its adjusted BCA of ba1. In the
same way, given AIB's systemic importance, Moody's expects a
moderate probability of support from the Irish government for
EBS's deposits. This results in a further one-notch uplift above
the adjusted BCA.

The positive outlook on EBS's long-term deposit ratings is driven
by the outlook on AIB.

Given the high level of integration between EBS and its parent,
an upgrade or downgrade of AIB's ratings and/or BCA would likely
trigger an upgrade or downgrade of the bank's ratings and/or BCA.
EBS's ratings could also be downgraded in the event of a lower
degree of integration with AIB.

LIST OF AFFECTED RATINGS

Issuer: Allied Irish Banks, p.l.c.

Affirmations:

-- Adjusted Baseline Credit Assessment, affirmed ba1

-- Baseline Credit Assessment, affirmed ba1

-- Long-term Counterparty Risk Assessment, affirmed A3(cr)

-- Short-term Counterparty Risk Assessment, affirmed P-2(cr)

-- Long-term Bank Deposits, affirmed Baa1, outlook changed to
    Positive from Stable

-- Short-term Bank Deposits, affirmed P-2

-- Senior Unsecured Regular Bond/Debenture, affirmed Baa2,
    outlook changed to Positive from Stable

-- Senior Unsecured Medium-Term Note Program, affirmed (P)Baa2

-- Subordinate Regular Bond/Debenture, affirmed Ba2

-- Subordinate Medium-Term Note Program, affirmed (P)Ba2

-- Junior Subordinate Medium-Term Note Program, affirmed (P)Ba3

-- Preferred Stock Non-cumulative, affirmed B1(hyb)

-- Other Short Term, affirmed (P)P-2

Outlook Action:

-- Outlook changed to Positive from Stable

Issuer: AIB Group plc

Assignments:

-- Senior Unsecured Medium-Term Note Program, assigned (P)Ba2

No Outlook assigned

Issuer: EBS d.a.c.

Affirmations:

-- Adjusted Baseline Credit Assessment, affirmed ba1

-- Baseline Credit Assessment, affirmed ba1

-- Long-term Counterparty Risk Assessment, affirmed A3(cr)

-- Short-term Counterparty Risk Assessment, affirmed P-2(cr)

-- Long-term Bank Deposits, affirmed Baa1, outlook changed to
    Positive from Stable

-- Short-term Bank Deposits, affirmed P-2

Outlook Action:

-- Outlook changed to Positive from Stable

PRINCIPAL METHODOLOGY

The principal methodology used in these ratings was Banks
published in September 2017.


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


LIFE INSURANCE: Fitch Assigns 'B' IFS Rating, Outlook Stable
------------------------------------------------------------
Fitch Ratings has assigned Kazakhstan-based Joint-Stock Company
Life Insurance Company Standard Life (Standard Life) an Insurer
Financial Strength (IFS) Rating of 'B' and a National IFS Rating
of 'BBB-(kaz)'. The Outlooks are Stable.

KEY RATING DRIVERS
The ratings reflect Standard Life's weak business profile,
exposure to long-term risks in the insurance portfolio, high
investment risk and poor asset-liability matching. This is offset
by the company's strong regulatory solvency position.

Standard Life is a medium-sized Kazakh life insurance company
with a market share of 6% measured by gross written premiums
(GWP) (including workers' compensation business) in 2017. In
international terms, Standard Life is a small life company with
total assets of KZT22.7 billion at end-2017 (approximately USD70
million, based on current exchange rates).

Standard Life's new business mix has shifted since 2015 to
pension annuities, de-emphasising life insurance. Pension
annuities represented 73% of net written premiums (NWP) in 2017.
However, the company is exposed to significant longevity and
interest rate risks in its annuity business, particularly in the
context of limited investment opportunities in local capital
markets. Fitch believes the limited track record of operations
and multiple changes in the management team also increase
Standard Life's operational risk.

Fitch views Standard Life's regulatory capital position as strong
for the rating. Standard Life complies comfortably with
regulatory solvency capital requirements, with the coverage ratio
at 340% at end-2017 (2016: 269%). Standard Life plans to maintain
the solvency margin ratio above 260% throughout 2018.

Standard Life paid out a significant dividend in 2016, following
a similar level of dividend in 2015 (in absolute amount). The
dividend paid in 2016 represented 330% of net profit for the
year, reflecting significant retained earnings in 2015 from "one-
off" forex gains in that year. Fitch understands that the
shareholder takes into account the level of the regulatory
solvency margin coverage ratio in making decisions on profit
repatriation.

Standard Life invests primarily in local bank deposits and to a
lesser extent in fixed-income securities. Bank deposits accounted
for 87% of total investments at end-2017, in line with 2016. The
deposits are largely placed with banks rated in the 'B' category.

Standard Life is exposed to a significant duration mismatch
between its assets and its liabilities. The average duration of
the liabilities related to pension annuity business is over 10
years while the duration of its assets is less than a year. The
company's ability to reduce this gap is limited by a lack of
sufficient long-dated assets, or hedging instruments, in the
local capital markets.

Based on 2017 statutory reporting, Standard Life reported KZT766
million of net income, which was driven by positive technical
results both in non-life and life segments. In the life segment,
Standard Life benefited from a strong investment return component
on the pension annuity business.

Standard Life lost its protection business distribution channel
following the change in ownership in 2017. Protection policies
were written through the bank branches of the former parent bank,
and formed a significant amount of the company's premiums (60% of
GWP in 2016). This business line also generated a positive
contribution to the underwriting result in recent years. The
termination of this business was followed by a KZT405 million
reserve release, which will not be repeated in 2018. Fitch
expects that the underwriting result in 2018 may therefore be
weaker.

RATING SENSITIVITIES

The ratings could be downgraded if Standard Life's capital
position or financial performance weakens significantly, which
could be, for example, a result of reserve strengthening in the
annuity or workers' compensation business lines. Both lines are
significantly exposed to any potential changes in regulatory
requirements, as regards pricing, tariffs and reserving in
particular.

The ratings could be upgraded if Standard Life continues to be
profitable or reduces investments risk or asset-liability
mismatch, or improves the business diversification.

In accordance with Fitch's policies the issuer appealed and
provided additional information to Fitch that resulted in a
rating action that is different than the original rating
committee outcome.


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


CRYSTAL ALMOND: Fitch Puts 'B' Secured Rating on Watch Negative
---------------------------------------------------------------
Fitch Ratings has placed the issuance ratings of various
speculative grade EMEA corporates on Rating Watch.

KEY RATING DRIVERS

The rating actions reflect the publication of Fitch's "Exposure
Draft: Country-Specific Treatment of Recovery Ratings" on 14
February (for additional information see "Fitch Publishes
Exposure Draft for Country-Specific Treatment of Recovery
Ratings" at www.fitchratings.com).

RATING SENSITIVITIES

Fitch expects to resolve the Rating Watches within the next six
months upon completion of the exposure draft period.

If the final criteria are substantially similar to the Exposure
Draft, then the ratings are likely to be impacted after the final
criteria report is published.

Fitch has taken the following rating actions:

3AB Optique Developpement S.A.S
Senior secured long-term rating of 'BB-'/'RR2' placed on Rating
Watch Positive

Crystal Almond S.a.r.l.
Senior secured long-term rating of 'B'/'RR3' placed on Rating
Watch Negative

IKKS Group S.A.S.
Senior secured long-term rating of 'B-'/'RR2' revised to Rating
Watch Evolving from Rating Watch Negative

Picard Groupe SAS
Senior secured long-term rating of 'BB-'/'RR2' placed on Rating
Watch Positive

Telenet Finance Luxembourg Notes S.a.r.l. / Telenet Finance V
Luxembourg S.C.A. / Telenet Finance VI Luxembourg / Telenet
Financing USD LLC / Telenet International Finance Sarl (Telenet)
Senior secured long-term rating of 'BB'/'RR2' placed on Rating
Watch Positive

UPC Broadband Holding B.V. / UPC Financing Partnership / UPCB
Finance IV Limited / UPCB Finance VII Limited (UPC)
Senior secured long-term rating of 'BB'/'RR3' placed on Rating
Watch Positive

Wind Tre SpA (Wind)
Senior secured long-term rating of 'BB'/'RR2' placed on Rating
Watch Negative


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


DECO 14: Fitch Affirms 'Csf' Ratings on 3 Tranches
--------------------------------------------------
Fitch Ratings has affirmed DECO 14 - Pan Europe 5 B.V.'s (DECO
14) floating notes due 2020:

EUR16.5 million class C (XS0291365566) affirmed at 'B+sf';
Outlook Positive
EUR100.8 million class D (XS0291367182) affirmed at 'Csf';
Recovery Estimate (RE) revised to 25% from 35%
EUR25.8 million class E (XS0291367422) affirmed at 'Csf'; RE 0%
EUR11.9 million class F (XS0291368156) affirmed at 'Csf'; RE 0%

KEY RATING DRIVERS

The affirmation of the class C notes reflects: i) successful
property sales from the CGG-Tambelle REDO 3 and Arcadia loans,
which have reduced the balance of the class C notes by around
EUR19 million; and ii) a sale and purchase agreement (SPA) for
the Bonn property under the CGG-Tambelle loan. If successful, the
purchase price of EUR20 million for the Bonn property would fully
repay the class C notes. Even if the sale falls through, Fitch
considers it a sign of market interest in the property, which
supports the Positive Outlook.

Fitch maintains its view that the class D notes will be subject
to significant losses, and has revised its RE down to 25% in view
of the significant concessions made to secure a new lease in the
Cottbus centre.

The EUR53.5 million CGG- Tambelle loan has been repaid by EUR12.9
million over the last 12 months from the sale of six assets
leaving only the Bonn (subject to the SPA) and Cologne
properties. The SPA for the Bonn property was signed in December
2017 and is expected to complete in April 2018. Fitch is not
aware of any progress in selling the Cologne property, which is
currently undergoing minor works.

The property securing the EUR39.6 million Cottbus Shopping Centre
loan is predominantly let to Kaufland and has a reported LTV of
215%. A lease renewal was negotiated and signed in January,
committing Kaufland for a further 10 years. To secure this
renewal, EUR8 million is being directed towards refurbishment
measures, financed with EUR7 million of funds (EUR5.9 million of
which is already trapped, the remainder still to be trapped)
escrowed at the expense of debt service, as well as a EUR1
million contribution from Kaufland (recouped by way of a three-
year approximately 33% rent reduction). No debt service payments
are currently being made.

The last property securing the EUR56.5 million Arcadia loan was
sold in December 2017. However, the sale proceeds of EUR2.4
million were not able to be distributed in time for the January
IPD and will be applied on the April IPD. There will be a
significant loss from this loan.

No properties secure the EUR13.5 million Mansford Nord Bayern
loan, with any further recoveries being made from the EUR0.3
million cash reserve.

RATING SENSITIVITIES

Evidence of significant enhancement in asset value of the Cottbus
Shopping Centre and a purchase price greater than the market
value of Cologne, could result in an improved RE for the class D
notes.

Fitch estimates 'Bsf' proceeds of EUR41.7 million.


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


AKER BP: S&P Affirms BB+ ICR & Rates New $500MM Notes 'BB+'
-----------------------------------------------------------
S&P Global Ratings said that it has affirmed its 'BB+' long-term
issuer credit rating on Norway-based oil and gas exploration and
production company Aker BP ASA. The outlook is stable.

S&P said, "At the same time, we assigned our 'BB+' issue rating
and '3' recovery rating to the company's proposed $500 million
senior unsecured notes due 2025. Our '3' recovery rating
indicates our expectation of meaningful recovery (50%-70%,
rounded estimate 55%) in a default scenario.

"The affirmation reflects our view that the proposed financing
transaction will have a minimal impact on the company's
prospective credit measures, given our expectation that the
company will use the proceeds to reduce drawings under the
reserve-based lending (RBL) facility. It will nevertheless
improve the company's liquidity position, which we now assess as
strong, with pro forma availability under the RBL exceeding $3
billion. We do not have clarity on how the company will use this
liquidity or how it may support further expansion of its
operations through acquisitions or exploration, but the company
has ample financial flexibility.

"The rating reflects our view of Aker BP's midsize reserve base
and production levels, relatively high asset concentration, and
the capital intensity required to develop its reserves into
production and renew its consumed reserve base. We view
positively management's experience, the swift integration of
acquired assets in past years, and the company's ownership
structure, mainly composed of Aker ASA and BP PLC.

"We note that Aker BP's credit measures have improved beyond our
projections over the past few quarters. This was through strong
operational performance with production increases, but also
higher oil prices than our assumptions. This should result in
funds from operations (FFO) to debt in the 40%-45% range at year-
end 2017 and in 2018, which is close to one of our upside rating
triggers. However, we anticipate a drop in credit ratios in 2019
before the major production start at the Johan Sverdrup field,
notably because we assume an oil price of $55 per barrel (/bbl)
from that year onward, and because capital expenditures (capex)
will remain high. This, combined with dividends above $500
million and an increase in cash taxes, could result in
meaningfully negative discretionary cash flows. Overall, however,
we believe the company's FFO to debt will remain within the 30%-
45% range, on average, over the coming years.

"The stable outlook reflects our view that Aker BP's weighted-
average credit metrics will remain above 30% in the next three
years, thus remaining commensurate with the rating. We anticipate
improvements in credit metrics when the Johan Sverdrup field
starts producing, although that would depend on cash taxes and
dividends, which will likely start rising over the next few
years.

"We could raise the rating in the next 12 months if we expect FFO
to debt will improve and remain above 45% for a sustained period.
This would most likely occur if average commodity prices were
higher than our current price deck assumptions, or if the company
continued expanding and increasing its proved reserves and
production more in line with higher-rated peers', while
maintaining credit measures at the current level. An upgrade is
also tied to conservative financial policies in line with an
investment-grade rating.

"We could downgrade the company if we expected FFO to debt to
fall and remain below 30% for a prolonged period. This would most
likely occur if market conditions severely deteriorated and, at
the same time, capex exceeded operating cash flows and dividend
payouts were larger than our current estimates. If production was
weaker than our projections, notably due to high depletion rates,
or if the company pursued another acquisition that had a material
negative impact on the balance sheet, we could also lower the
rating in the next year."


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


O1 PROPERTIES: S&P Places 'B' ICR on Watch Neg. on Laysa Takeover
-----------------------------------------------------------------
S&P Global Ratings said that it had placed its 'B' long-term
issuer credit rating on Russian real estate investment company O1
Properties Ltd. on CreditWatch with negative implications.
S&P also put its 'B-' issue ratings on the notes issued by O1
Properties Finance plc and O1 Properties Finance JSC on
CreditWatch negative.

The CreditWatch follows the announcement by O1 Properties' parent
company, O1 Group, of its intention to sell its controlling stake
in O1 Properties to Laysa Group, large private outdoor
advertising supplier to Russian Railways. The transaction is
conditional on the approval of the antitrust regulator and
agreement with creditors, as some of company's debt has change-
of-control clauses, including the $350 million Eurobond maturing
in 2021.

The deal's conditions include Laysa Group's commitment to repay
O1 Group's Russian ruble (RUB) 25 billion ($430 million) loan
from Credit Bank of Moscow. S&P now views O1 Properties'
liquidity position as less than adequate, due to the additional
cash outlays that might be needed to repay the Credit Bank of
Moscow loan, as well as the company's weak credit standing in the
public debt markets.

S&P said, "We acknowledge heightened risks to O1 Properties' debt
leverage and increased uncertainty over the company's future
strategy and financial policy. If additional debt is raised for
the transaction, it might put pressure on O1 Properties' already
weak credit metrics, as its debt-to-debt plus equity ratio is
more than 70% and its EBITDA interest coverage is less than 1.5x.

"We expect to resolve the CreditWatch when the transaction is
completed and after we have more clarity on the new shareholder's
strategy and financial policy.

"We could consider downgrading O1 Properties by one notch or more
if we expect the transaction with Laysa Group will lead to higher
debt leverage or a weaker liquidity position. We could also lower
the rating on O1 properties if we believe the company had become
integral to the identity of an entity with a weaker group credit
profile.

"We would likely affirm our 'B' rating on O1 Properties if the
announced transaction falls through or if we believed the
transaction would not pose a threat to O1 Properties' credit
metrics or overall credit profile. An affirmation would also be
conditional upon the final resolution of ongoing legal disputes
between O1 Group and Bank Otkritie Financial Co. without
additional negative implications for O1 Properties' credit
quality."


KREDIT EXPRESS: Put on Provisional Administration
-------------------------------------------------
The Bank of Russia, by Order No. OD-629, dated March 15, 2018,
revoked the banking licence of Rostov-on-Don-based credit
institution limited liability company Commercial Bank Kredit
Express or LLC CB Kredit Express (Registration No. 3186) from
March 15, 2018.  According to the financial statements, as of
March 1, 2018, the credit institution ranked 372nd by assets in
the Russian banking system.

It was revealed that LLC CB Kredit Express repeatedly violated
law on countering the legalisation (laundering) of criminally
obtained incomes and the financing of terrorism, including, but
not limited to, the complete and reliable notification of the
authorised body about, among other things, operations subject to
obligatory control.

The due diligence check of the accepted credit risk at the
regulator's request established a substantial loss of capital and
entailed the need for action to prevent the credit institution's
insolvency (bankruptcy), which created a real threat to its
creditors' and depositors' interests.

The Bank of Russia repeatedly applied supervisory measures to LLC
CB Kredit Express, including two impositions of restrictions on
household deposit taking.

The credit institution's management and owners failed to take
effective measures to normalise its activities.  As it stands,
the Bank of Russia took the decision to withdraw LLC CB Kredit
Express from the banking services market.

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, repeated violations within a year
of requirements stipulated by Article 7 (excluding Clause 3 of
Article 7) of the Federal Law "On Countering the Legalisation
(Laundering) of Criminally Obtained Incomes and the Financing of
Terrorism" as well as Bank of Russia regulations issued in
accordance with the said law and application of the measures
stipulated by the Federal Law "On the Central Bank of the Russian
Federation (Bank of Russia)", taking into account a real threat
to the interests of creditors and depositors.

The Bank of Russia, by Order No. OD-630, dated March 15, 2018,
appointed a provisional administration to LLC CB Kredit Express
for the period until the appointment of a receiver pursuant to
the Federal Law "On 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.

LLC CB Kredit Express 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.


WELLTON BANK: Bank of Russia Cancels License After Liquidation
--------------------------------------------------------------
The Bank of Russia, by Order No. OD-635, dated March 15, 2018,
revoked the banking license of Belgorod-based credit institution
Joint-stock Company Wellton Bank or JSC Wellton Bank
(Registration No. 1105) effective March 15, 2018.

The Bank of Russia cancelled the credit institution's banking
licence based on Article 23 of the Federal Law "On Banks and
Banking Activities" following the decision of the credit
institution's authorised body to terminate its activity through
voluntary liquidation according to Article 61 of the Civil Code
of the Russian Federation and the submission of the respective
application to the Bank of Russia.

Based on the data provided to the Bank of Russia, the credit
institution has enough assets to satisfy creditors' claims.

In compliance with Article 62 of the Civil Code of the Russian
Federation and Article 21 of the Federal Law "On Joint-stock
Companies", a liquidation commission will be appointed to Wellton
Bank.

Wellton Bank is a member of the deposit insurance system.  The
cancellation 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.

According to the financial statements, as of March 1, 2018,
Wellton Bank ranked 500th by assets in the Russian banking
system.

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



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


IF P&C: S&P Assigns BB+ Issue Rating to Restricted Tier 1 Notes
---------------------------------------------------------------
S&P Global Ratings assigned its 'BB+' issue rating to the
restricted tier 1 notes proposed by Sweden-based intermediate
holding company If P&C Insurance Holding. The issue rating is
subject to S&P's receipt and review of the notes' final terms and
conditions.

If P&C Insurance Holding is the nonoperating holding company of
Sweden-based If P&C Insurance Ltd. (publ) (A+/Stable/--). The
ratings on If P&C Insurance Holding are two notches below the
ratings on the core entity, reflecting S&P's view of the ongoing
subordination of If P&C Insurance Holding's creditors.
Nonoperating holding company Sampo PLC (A-/Stable/--) is the
ultimate parent of If P&C Insurance Holding.

If P&C Insurance Ltd. reported a solvency capital requirement
(SCR) coverage of 197% at year-end 2017. However, S&P notes that
the trigger event currently defined in the proposed notes'terms
and conditions refers to the Sampo solvency ratio and not that of
If P&C Insurance Ltd. Sampo's 2017 SCR coverage stood at 154%.
If, in the future, If P&C Insurance Holding and its group were
subject to regulatory oversight for Solvency II purposes, the
trigger event would possibly be linked to the solvency ratios of
If P&C Insurance Ltd.

The rating on the notes is four notches below the long-term
issuer credit rating on If P&C Insurance Holding; one notch to
reflect the notes' subordinated status, one to reflect their
interest deferral features, one to reflect the risk of principal
write-down, and one to highlight the increased risk of coupon
nonpayment on a going-concern basis for these notes in comparison
with If P&C Insurance Holding's other subordinated instruments.
S&P's rating takes into account its understanding that:

-- The noteholders are subordinated to senior creditors;

-- The issuer has the discretion to cancel interest payments;

-- Interest cancellation is mandatory under certain
    circumstances. For example, if the solvency condition is not
    met, or, if under Solvency II regulations, Sampo's own funds
    are not sufficient to meet either the SCR or minimum capital
    requirement (MCR), or upon insufficient distributable items;

-- The notes will be eligible as restricted tier 1 capital under
    Solvency II; and

-- The notes will be written down in the event that the amount
    of own-fund items eligible to cover the SCR is equal to or
    less than 75% of the SCR; or the amount of own-fund items
    eligible to cover the MCR is equal to or less than the MCR;
    or a breach of the SCR has occurred and is not remedied
    within a period of three months from the date on which it was
    first observed. In addition, the issuer can choose to
    reinstate the notes at its discretion under certain
    circumstances.

As Sampo's regulatory capital position evolves, the notching on
these instruments could be altered to reflect changes in the
likelihood of default. A sustainable and significant increase in
Sampo's SCR coverage could reduce the number of notches between
the rating on the notes and the issuer credit rating. However,
deterioration in the group's capital position or increased
sensitivity to stress could increase the gap by one or more
notches.

S&P understands that the notes are perpetual, but are callable at
par after at least five years and on any interest payment date
thereafter. The notes are expected to carry a floating rate or a
fixed-to-floating rate of interest.

If P&C Insurance Holding also has the option to redeem the notes
at par before the first call date under specific circumstances,
for example, for changes in tax, accounting, regulatory, or
rating agency treatment. Based on current regulations, any
redemption must be replaced by an instrument of at least the same
quality.

S&P said, "We expect to classify the notes as having intermediate
equity content, subject to our receipt and review of the notes'
final terms and conditions. Hybrid capital instruments with
intermediate equity content can comprise up to 25% of total
adjusted capital (TAC), which is the basis of our consolidated
risk-based capital analysis of insurance companies. Inclusion in
TAC is also subject to the issue being considered eligible for
regulatory solvency regarding both amount and terms and
conditions.

"We believe that If P&C Insurance Holding will use the proceeds
to replace other debt instruments, including recently repurchased
subordinated securities. We project that Sampo's financial
leverage (debt plus hybrid capital, divided by the sum of
economic capital available, debt, and hybrid capital) will remain
prudent over the next two-to-three years, at slightly above 20%.
We anticipate that the fixed-charge coverage ratio (EBITDA
divided by senior and subordinated debt interest) will likely
exceed 40x in 2018-2019."


POLYGON AB: Fitch Assigns 'B' Long-Term IDR, Outlook Positive
-------------------------------------------------------------
Fitch Ratings has assigned a final Long-Term Issuer Default
Rating of 'B' to the Swedish property damage restoration (PDR)
operator, Polygon AB. Fitch has also assigned a final instrument
rating of 'B+'/'RR3'/58% to the group's EUR210 million senior
secured notes. The Outlook on the IDR is Positive.

Polygon's 'B' rating reflects a niche specialist business profile
that benefits from the company's leading market position in a
non-cyclical business. Pro forma for the notes issue, the
financial profile with 5.0x funds from operations (FFO)-adjusted
gross leverage is commensurate with the rating, but is
constrained by the company's limited size and low EBITDA margins
compared with Fitch-rated peers.

The Positive Outlook reflects Fitch's expectation that the
company, under its experienced management, will generate revenue
and margin growth via the benefits of scale from organic
operations and the integration of bolt-on acquisitions. Fitch
expects leverage to decline over the next two years, with FFO-
adjusted gross leverage falling below the upward rating
sensitivity guidance of 4.5x by 2020. Fitch expects small
acquisitions, which can be accommodated within the new capital
structure without incurring additional debt, to support EBITDA
growth.

KEY RATING DRIVERS

Leading Industry Player: Polygon holds a dominant market share in
the European PDR market, which the company estimates to be valued
at around EUR5.2 billion a year. It shares its market leadership
with only one key US-focused global competitor. Polygon's
relatively small operating size and limited free cash-flow
generation after acquisitions constrain its rating, despite it
being among the few companies providing integrated, professional
services in the PDR market to large property insurance
underwriters and brokers.

Unpredictable yet Recurring Business: Demand for PDR services has
been resilient. In 2017, around 95% of the jobs performed by
Polygon were caused by unpredictable yet regular events, such as
water leaks and fires not related to unusual and extreme weather
conditions. The growing number of major weather events and their
magnitude has the potential to further stimulate the need for its
services.

Highly Fragmented Market: The company operates in a market that
is comprised mainly of small operators. Polygon has acquired
several mid- to small-sized companies in the past few years; in
2017 it boosted its M&A activity when it completed six
acquisitions, which will add sales of around EUR65 million a
year. The one significant exception in terms of targeted size was
the acquisition of German competitor Vatro, which at the time of
acquisition in 2011 was the leading company in its home market,
generating revenues in excess of EUR150 million.

Fitch views the potential for consolidation in the market as
high, with Polygon among the consolidators. The current rating
level can accommodate small acquisitions, considering the
potential to build scale and improve local access. The careful
selection of targets and their relatively small size mitigate
integration risks.

Solid Customer Base: Polygon's consolidated relationships with
insurance companies under long-term framework agreements (FWAs)
provide some barriers to entry and a competitive advantage for
its sub-contractor network. Customers require increased
sophistication and this favours organised companies that can
offer multiple services and fast delivery. To this extent, Fitch
views the FWAs with customers as credit positive: although not
binding, they offer a good platform to secure future jobs and
attract sub-contract partners. Polygon's customer-retention rate
is high, averaging around 99% over the past four years.

'B' Financial Profile: Polygon's financial profile and free cash-
flow margins are consistent with the 'B' credit metrics, pro
forma for the issue of the notes. Debt-service metrics and
liquidity from cash on balance sheet following the proposed note
issue and access to a revolving credit facility are strong for
the rating. Fitch forecast FFO-adjusted leverage will decline
over the rating horizon, from around 5.0x at end-2018E to 4.5x in
the following 24 months, in the absence of large debt-funded M&A
transactions. Fitch expect its free cash-flow margins to rise
toward the mid-single digits by 2020.

DERIVATION SUMMARY

Polygon AB is the market leader in the European PDR market.
Polygon has a strong business profile, similar to other Fitch
publicly rated mid-sized companies active in niche markets, such
as L'Isolante K-Flex S.p.A. (B+/Stable) and Praesidiad
(B/Stable). These companies, despite their small size, have a
wide geographical reach and strong reputations among their
diversified client bases. These characteristics, paired with
Polygon's framework agreements with leading property insurance
providers and leading market positions in Germany, the UK and the
Nordics, provide some barriers to entry and enhance operating
leverage. Polygon's profitability is lower than these two peers,
but margins are aligned to those of the PDR industry, with the
potential for improvement as size increases. Its pro forma
leverage profile following the placement of the notes and its
current free cash-flow generation are consistent with a 'B'
rating.

KEY ASSUMPTIONS

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

- high single-digit top-line growth, supported by organic growth
   and small- to mid- size acquisitions;
- margin improvement towards 10%, driven by operating leverage
   and cost control measures;
- no cash return to shareholders over the next four years;
- no large, transformational M&A.

KEY RECOVERY RATING ASSUMPTIONS

- The recovery analysis assumes that Polygon would continue as a
   going concern in bankruptcy and that the company would be
   reorganised rather than liquidated.
- Polygon's post-reorganisation, going-concern EBITDA reflects
   Fitch's view of sustainable EBITDA, discounted by 25% from pro
   forma 2017 adjusted EBITDA of EUR48 million.
- An EV multiple of 5.0x is used to calculate a going-concern
   enterprise value in a distressed scenario, and reflects the
   group's leading market position, strong brand, yet relatively
   small size with the potential for growth to consolidate its
   position.
- Fitch assume a 10% administrative claim on the going-concern
   enterprise value.
- The waterfall by instrument ranking against the adjusted
   enterprise value results in a 58% recovery for Polygon's
   senior secured notes, corresponding to 'RR3' in Fitch's
   recovery scale and a one-notch uplift for the instrument
   rating on the notes to 'B+'.

RATING SENSITIVITIES

Future Developments That May, Individually or Collectively, Lead
to Positive Rating Action
- Operating leverage manifested by improving scale and EBITDA
   margins trending towards 10%
- Consistent free cash-flow generation with FCF margins in mid-
   single digits
- FFO adjusted leverage below 4.5x on a sustained basis

Future Developments That May, Individually or Collectively, Lead
to Negative Rating Action
- Stabilisation of the Outlook, if the positive sensitivities
   are not met within 18-24 months
- Lack of overall top-line expansion and pressure on margins
- Neutral to negative free cash-flow generation
- FFO adjusted leverage above 6.0x on a sustained basis
- FFO interest coverage below 1.5x

LIQUIDITY

Adequate Liquidity: Fitch views Polygon's liquidity position as
satisfactory following the notes issue, which will extend the
debt maturity to March 2023. At closing, Polygon will have access
to cash of around EUR40 million - post repayment of the existing
EUR180 million notes and transaction fees - and to an undrawn
revolving credit facility for EUR40 million.


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


CO-OPERATIVE BANK: Draws Line Under Past, Posts Narrowing Losses
----------------------------------------------------------------
Iain Withers at The Telegraph reports that Co-op Bank chief
executive Liam Coleman has said the lender is "drawing a line
under the past" after its near-collapse and a string of scandals,
as it posted narrowing full-year losses.

The bank -- which was rescued by a group of US hedge funds last
summer -- posted a pre-tax loss of GBP174.4 million for 2017,
compared to a loss of GBP477.1 million a year earlier, The
Telegraph relates.

According to The Telegraph, Mr. Coleman said his "mission
statement" for the lender was "simplifying the bank and growing
it".

The bank has slashed costs in the last year, shedding 800 jobs,
The Telegraph discloses.

Co-op Bank flirted with failure in 2013 when a GBP1.5 billion
black hole was discovered on its balance sheet, The Telegraph
recounts.

A group of investors led by US hedge funds agreed to take over
and inject GBP700 million last July, after a protracted search
for a buyer failed, The Telegraph relays.

Its former parent The Co-Operative Group has since cut its stake
to less than 1%, raising concerns about its new owners'
commitment to the retained Co-op brand's ethical principles, The
Telegraph notes.

                     About Co-operative Bank

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

In 2013-2014, the Bank was the subject of a rescue plan to
address a capital shortfall of about GBP1.9 billion.  The Bank
mostly raised equity to cover the shortfall from hedge funds.

In February 2017, the Bank's board announced that they were
commencing a sale process for the Bank and were "inviting
offers."

The Troubled Company Reporter-Europe reported on Sept. 12, 2017,
that Moody's Investors Service upgraded the standalone baseline
credit assessment (BCA) of the Co-operative Bank Plc (the Co-op
Bank) to caa2 from ca in light of its improved credit profile and
capital position given the implementation of the bank's capital
increase.

Moody's upgraded the bank's long-term senior unsecured debt
rating to Caa2 from Ca, reflecting the completion of the bank's
capital raising plan without the imposition of any losses on this
class of creditors.

Moody's confirmed the long-term deposit ratings at Caa2, at the
same level as its standalone BCA, given the reduced amount of
subordination benefiting this class of liabilities due to the
cancellation of Tier 2 capital as part of the restructuring. The
short-term deposit ratings were affirmed at Not Prime.


EG GROUP: Moody's Affirms B2 CFR, Outlook Stable
------------------------------------------------
Moody's Investors Service has assigned B2 ratings to the new
USD1,700 million and EUR175 million senior secured first lien
loans being raised by EG America LLC (EGA) and EG Finco Limited
(Finco) respectively and to a USD150 million incremental first
lien revolving credit facility in the name of Finco and EGA.
Concurrently, a Caa1 rating has been assigned to the new EUR400
million equivalent second lien loan being raised by EGA and
Finco. The new and incremental facilities are being raised in
connection with the latest acquisitions by EG Group Limited (EG)
in the US and The Netherlands.

The rating agency also affirmed EG's B2 corporate family rating
(CFR) and B2-PD probability of default rating (PDR), and the B2
rating on the existing senior secured first lien facilities of
Finco. The outlook on all ratings is stable.

"The latest announced acquisitions in the US and The Netherlands
come soon after EG announced agreed acquisitions in Italy and
Germany. This level of acquisitive activity will stretch
management and results in an elevated risk of missteps", says
David Beadle, a Moody's Senior Credit Officer and lead analyst
for the EG Group. "However, while pro-forma leverage will
increase, each of the acquired businesses is well-established and
EG has a strong track record, including in respect of integrating
acquisitions", he added.

RATINGS RATIONALE

Last month EG concluded the syndication of a loan transaction in
connection with the acquisitions of sites in Italy and Germany
from Esso's owners, Exxon Mobil Corporation (Aaa stable). The
company is now returning to the debt markets to fund two further
acquisitions. The larger of these transactions, the USD2.15
billion acquisition of the convenience store and fuel forecourt
business of The Kroger Co. (Baa1 stable), will see EG enter the
US for the first time. In contrast, the acquisition of a
portfolio of Esso branded sites in the Netherlands from NRGValue
Retail B.V. represents a relatively modest bolt-on to EG's
established business in the country.

The fully-debt funded nature of these transactions will result in
EG's Moody's-adjusted leverage increasing to around 7.0x on a
pro-forma basis. This is high for the rating category, and beyond
the 6.5x level that Moody's previously signaled could result in
negative rating pressure. While EG management targets a reduction
towards lower than 6x by 2019 driven by cost efficiencies and
synergies, Moody's factors in somewhat lower cost efficiencies
and synergies in its base case, in which pro-forma leverage
returns to around 6.5x by the end of 2019.

The elevated leverage coupled with execution risks linked to
completing and integrating four acquisitions over the course of
six to eight months means that EG is now weakly positioned in the
B2 rating category, with the ratings being exposed to negative
pressure from a potential weak execution of the integrations.

More positively, Moody's notes EG has a strong track record in
successfully integrating acquisitions, and each of the businesses
being acquired is well-established, being sold by companies with
reputations for well-invested assets and will be operated under
stable conditions. Furthermore, the rating agency considers EG
has solid liquidity and stable underlying cash flow dynamics.
While growth-project related capex will increase after these
latest acquisitions, most notably in the US, Moody's nevertheless
expects EG to generate annual free cash flows in excess of EUR200
million in 2018 and 2019. Moody's also positively note that the
B2 ratings of the first lien facilities, while rated at par with
the CFR will benefit from their priority position versus the
second lien facility.

RATING OUTLOOK

The stable outlook reflects Moody's expectations that EG's
underlying financial performance will continue to improve, driven
by an ongoing successful roll-out of additional Food-to-Go units
and successful execution of strategy in respect of the four
acquisitions agreed over recent months. Nevertheless EG will have
very limited room for underperformance in the current rating
category. No further material acquisitions are factored in.

While unlikely in the short to medium term, the ratings could
experience upward pressure if, following a period where results
of the various recently agreed acquisitions prove to be in line
with expectations, the company achieves further sustained overall
earnings growth, leading to positive free cash flow and a
debt/EBITDA ratio falling sustainably below 5.5x.

Negative pressure could be exerted on EG's ratings if operating
performance deteriorates or does not improve resulting in
leverage exceeding 6.5x on a sustained basis; or if free cash
flow were to turn negative for an extended period of time; or
liquidity were to weaken. Negative rating pressure would also be
likely if EG pursued additional sizable debt-funded acquisitions
this year.

PRINCIPAL METHODOLOGY

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

CORPORATE PROFILE

EG, headquartered in Blackburn, England, is the parent company of
a group which is one of the leading independent motor-fuel
forecourt operators in Europe. In 2017 the group operated around
350 fuel sites across Great Britain, a similar number in France,
and more than 700 in the Benelux. In recent months EG has agreed
four transactions which will significantly increase the scale and
geographic reach of the Group. By the time all of these deals
complete later this year EG's operations will also cover Italy,
Germany and the United States and comprise around 4,500 sites in
total.

EG Group is owned equally by funds managed by TDR Capital LLP and
the two brothers who founded Euro Garages, Mohsin & Zuber Issa.

Pro-forma for the current pending acquisitions the EG Group has
annual Revenues of more than EUR15 billion and adjusted run rate
EBITDA (as defined by EG) of EUR815 million.


EG GROUP: Fitch Rates New Second Lien Debt 'CCC+(EXP)'
------------------------------------------------------
Fitch Ratings has resolved the Rating Watch Negative (RWN) and
affirmed UK-based petrol retailer EG Group Limited's (EG) Long-
Term Issuer Default Rating (IDR) and senior secured debt rating
at 'B' with a Recovery Rating of 'RR4(48%)'. Fitch has also
assigned EG's new second lien debt an expected issue rating of
'CCC+(EXP)' with a Recovery Rating of 'RR6(0%)'. The IDR is
placed on Stable Outlook.

The affirmation and Stable Outlook reflect Fitch's view that EG
should complete both the acquisition of 762 petrol fuel station
(PFS)/convenience stores sites in the US from The Kroger Co.
(BBB/Negative) and a smaller Dutch acquisition. The group should
be able to generate sufficient margin improvements and cost
savings from its recent acquisitions to ensure that in the medium
term the enlarged group remains within its sensitivities for a
'B' rating and in particular leverage below 7.5x (on an funds
from operations (FFO) gross lease adjusted basis) and FFO fixed-
charge cover above 2.0x.

Fitch believes that because the integration of the German and
Italian PFS operations from Esso, announced in 2017, has yet to
complete, the US acquisition increases execution risk, as the
scale of the transaction could compromise deleveraging prospects
if cost savings -- which appear achievable in the timeframe
proposed -- do not materialise as planned. However, Fitch
believes that the US acquisition is strategically sensible and
could provide EG with a stronger negotiating position with oil
majors, as it will improve the group's overall scale and
diversification outside Europe.

The conversion of the second lien instrument rating into final
ratings is conditional upon the completion of the proposed
refinancing, the planned acquisition, and the final terms and
conditions of the debt instrument being in line with information
already received.

KEY RATING DRIVERS

Leading Global PFS Operator: The IDR reflects EG's position in
western Europe as a leading PFS and convenience retail/food to go
(FTG) operator, following the acquisition of Esso petrol stations
in Germany and Italy. The acquisition of The Kroger Co.'s sites
in the US should add around 4.3 billion litres of fuel sales a
year (pro-forma in the region of 15 billion litres for the whole
group in 2018) and Fitch expect EG will benefit from a better
negotiating position on fuel contracts with oil majors.

The acquisition will also diversify EG outside its core European
market and strengthen its partnerships with US FTG brands
(Starbucks and Subway). Kroger's 762 sites will place EG in the
top 10 operators of convenience stores in the US. Pro-forma for
the US and Esso acquisitions, EG will own 4,470 sites (up from
1,469) across Europe and the US and manage a portfolio of 310
high-quality highway sites.

US Acquisition Reduces Rating Headroom: Fitch estimates that the
entirely debt-funded US acquisition could increase FFO gross
leverage slightly above 7.0x and reduce FFO fixed-charge cover to
2.1x, thereby diminishing headroom under the current rating. The
proposed transaction reduces the group's flexibility to absorb
higher-than-expected costs -- such as a sharp rise in fuel costs
to customers -- or achieve lower-than-expected synergies from the
Esso and Kroger acquisitions while maintaining a credit profile
consistent with a 'B' rating.

Challenging Execution Risk from Acquisitions: EG has transformed
itself from a small entrepreneurial group into a major global
fuel and retail operator in less than three years. The group is
acquisitive as the PFS sector consolidates. Fitch views the US
acquisition as ambitious and strategically sensible but it
significantly increases execution risks at a time when the group
is already focused on completing and integrating two major
acquisitions from Esso PFS in Germany and Italy. The enlarged
scale and market reach will in all likelihood require changes to
management's organisation and control functions across the wider
group. However, Fitch sees EG's business model as sustainable and
management has a history of growing the business, identifying
significant margin improvements and cost-saving opportunities
from the integration of its targets. The Italian acquisition
completed in February 2018.

Growing Convenience, FTG Segments: EG's strategy is to develop
the convenience retail and FTG offer on its sites to capture
above-average growth in the sector as "time-short" consumers
increasingly want to shop more frequently and more easily/closer
to home or office. It also enables the group to offset stagnation
in fuel volumes and gross profits from fuel sales. EG has in
excess of 500 retail outlets and will install a further 140
stores in continental Europe in the next nine months. Fitch sees
this diversification and increase in scale as critical, given
stable-to-negative fuel volumes, broadly fixed fuel margins and
growing alternative fuel usage. EG should follow a similar
convenience/FTG-driven strategy in the US.

Capex Fuels Diversification and Margins: Fitch projects that once
the US acquisition is completed, EG's free cash flow is likely to
be constrained by high maintenance and growth capex rising to on
average EUR190 million-EUR200 million a year for the enlarged
group. Capex will fund the opening of new sites, the conversion
of the most promising stations from company-owned and dealer-
operated (CODO) to company-owned and operated (COCO) and support
the roll-out of EG's convenience retail/FTG strategy, as well as
increase the group's weighted average operating margins. Fitch
expects that the US acquisition will lead to a substantial
increase in capex but with an accretive impact on the group's
profit margins.

DERIVATION SUMMARY

EG's IDR of 'B' reflects the leading market position of the group
as an independent petrol station operator in Europe, positive FCF
and diversification towards more profitable non-fuel retailing
and FTG segments. However, with the planned US and Dutch
acquisitions funded entirely by debt, Fitch expect pro-forma FFO
adjusted gross leverage to increase slightly above 7.0x and FFO
fixed-charge cover to fall to 2.1x, which would not breach the
previously set negative sensitivities for the 'B' rating. The
Kroger convenience store acquisition should also be accretive on
operating margins although there is now increased execution risk.

A majority of EG's business is broadly comparable to other peers
that Fitch covers in its food/non-food retail rating and credit
opinions portfolios, although the COCO operating model should
provide more flexibility and profitability for EG. With around
300 highway sites, EG can also be compared with motorway services
group Moto Ventures Limited (B/Stable). Moto displays slightly
lower leverage than EG and benefits from an infrastructure-like
business profile. It also operates in a regulated market with
high barriers to entry that Fitch believe are more defensive than
that of EG. In contrast, EG is more geographically diversified
with exposure to both the US market and a strong market share in
seven western European countries, against only one in Moto's
case.

KEY ASSUMPTIONS

Fitch's Key Assumptions within Fitch Rating Case for the Issuer:

European business assumptions:
- Slight decline in fuel volumes, with stable gross margins;
- Convenience retail sales to grow 2%-3% a year, including new
   sites roll-out with stable gross margins of 32%-36%, depending
   on the country;
- Like-for-like FTG sales to increase 1% on top of new sites
   roll-out with stable gross margins above 60%;
- Stable overall EBITDA margin around 4%-5% of sales based on
   current fuel prices;

Kroger carve-out assumptions:
- USD4 billion revenue;
- Fully debt-funded;
- Neutral working capital;

Fitch's assumptions also include:
- EUR250 million additional cash spent on acquisitions a year
   from 2018 to 2021 at 10x EBITDA multiple fully funded by debt;
- EUR70 million a year maintenance capex spent;
- Growth capex around EUR125 million a year to fund new site
   openings, COCO conversions and convenience retail and FTG
   roll-out in Europe and the US; and
- No dividends.

KEY RECOVERY ASSUMPTIONS

As part of its bespoke recovery analysis, Fitch has applied a
discount of 25% to the LTM 2017 Fitch-estimated EBITDA (adjusted
for the Esso, Dutch and US acquisitions) to derive a post-
restructuring EBITDA. Fitch estimate that with a 25% discount,
the group should be cash-flow neutral, while paying its cash
interest, distressed corporate tax and capex.

According to Fitch bespoke recovery analysis, higher recoveries
would be realised using a going-concern approach, despite EG's
reasonable asset backing. Fitch expects a better recovery by
preserving the business model, as opposed to liquidating its
balance sheet, as this reflects EG Group's structurally cash-
generative business.

In a liquidation scenario, the highway sites would constitute the
majority of asset value but would not be sufficient when compared
to the recovered value of a going-concern scenario. The industry
is undergoing concentration/consolidation in most of EG's
geographies (Italy, Germany, UK and France) as a result of the
constant decline in fuel volumes of around 1% a year.

In a distressed scenario, Fitch believes that a 5.5x multiple
reflects a conservative view of the weighted average value of
EG's portfolio. By comparison, Moto's 7.5x distressed multiple
reflects the regulated nature of the market, the high quality of
their highway sites and their infrastructure-like cash-flow
generation profile.

As per its criteria, Fitch assumes EG's revolving credit
facilities (RCF) and letter of credit (LC) facility to be fully
drawn and takes 10% off the enterprise value to account for
administrative claims.

Additional assumptions: 1.13EUR/GBP, 1.23EUR/USD exchange rates

Outcome:
- Senior First-Lien Loan Rating: B/RR4/48%
- Second Lien Rating: CCC+(EXP)/RR6/0%

RATING SENSITIVITIES

Developments that may, individually or collectively, lead to
positive rating action:
- Evidence of success in the roll-out strategy of convenience
   retail and FTG sites in Germany and Italy, leading to EBITDA
   margin rising sustainably above 5%;
- FFO fixed-charge cover above 2.5x on a sustained basis;
- Sustainable EBITDA growth leading to FCF generation above 3%
   of sales; and
- FFO gross lease-adjusted leverage below 5.5x through the
   cycle, due to additional profits from new convenience
   retail/FTG outlet and/or rising fuel operating profits.

Developments that may, individually or collectively, lead to
negative rating action:
- FFO gross lease-adjusted leverage sustainably above 7.5x;
- FFO fixed-charge cover below 2x on a sustained basis; and
- Significant decline in fuel volumes and convenience retail
   sales and/or margins leading to the EBITDA margin falling
   below 3% based on current fuel prices.

In the event that the US acquisition does not complete, Fitch
would expect the ratings to be affirmed at 'B' with a Stable
Outlook, all other factors being unchanged.

LIQUIDITY

Satisfactory Liquidity: Expected cash at closing of the US
transaction should be around EUR132 million, which is sufficient
to fund the next two years of development capex related to new
site openings, COCO conversions and convenience retail/FTG
diversification. EG's liquidity should also benefit from positive
FCF, an increased RCF and EUR385 million LC facility. Changes in
working capital should be positive for the company due to the
upfront nature of payments by customers (fuel, convenience retail
and FTG).


EG GROUP: S&P Alters Outlook to Negative & Affirms 'B' ICR
----------------------------------------------------------
S&P Global Ratings said that it revised to negative from stable
its outlook on EG Group Ltd., parent company of petrol filling
station operator Euro Garages, and affirmed the 'B' long-term
issuer credit rating on EG Group.

S&P said, "At the same time, we assigned our 'B' issue rating and
'3' recovery rating to the proposed senior secured facilities
comprising two incremental senior secured term loans and a
revolving credit facility (RCF). The ratings reflect our
expectation of meaningful (50%-70%; rounded estimate 55%)
recovery in the event of default.

"We also assigned our 'CCC+' issue rating and '6' recovery rating
to the proposed second lien-term loans. This is two notches below
the issuer credit rating, reflecting our expectation of minimal
recovery in the event of default."

The proposed facilities comprise a senior secured RCF of US$150
million, an incremental senior secured term loan (TL) of EUR175
million issued by EG Finco Ltd., and an incremental senior
secured TL of US$1,700 million issued by EG America LLC. It also
comprises a second-lien TL totaling EUR400 million, split in a
U.S. dollar tranche and a euro tranche, and issued by EG America
LLC and EG Finco Ltd., respectively.

S&P also affirmed its 'B' issue rating and '3' recovery rating on
EG Group's existing senior secured facilities, reflecting its
expectation of meaningful (50%-70%; rounded estimate 55%)
recovery in the event of default. The existing senior secured
facilities comprise an RCF of GBP250 million, a GBP400 million
term loan B, and a EUR1.985 billion TLB split in three tranches:
EUR900 million, EUR250 million, and EUR835 million issued by EG
Finco Ltd. It also comprises a $500 million TLB issued by EG
Dutch Finco B.V.

The ratings are subject to the successful completion of the
refinancing transaction, including receipt of the final
documentation. If the refinancing transaction does not complete
or the scope of the transaction or the final documentation
departs materially from the current plan, S&P reserve the right
to withdraw or revise its ratings.

The outlook revision to negative follows EG Group's plan to
acquire Kroger's convenience store (C-Store) business comprising
762 sites in the U.S. and NRGValue with 97 petrol filling
stations in the Netherlands. The acquisition will be fully debt
financed with an additional EUR2 billion of debt. S&P said,
"After the transaction, we anticipate that our adjusted debt to
EBITDA will rise to around 7x in 2018 on a pro forma basis. We
also expect transaction and restructuring costs to depress
reported free operating cash flow (FOCF) in 2018, which should
just remain positive for the full year."

S&P said, "In our view, EG Group's aggressive debt-financed
acquisition strategy has enabled rapid expansion and improved
geographical diversity. After the transaction, we anticipate that
pro forma group reported EBITDA could reach EUR800 million in
2019, with the largest share of earnings coming from the U.S. at
about 30%, followed by around 20% from the U.K. and 13% from
France. Overall, Europe will remain the dominant region where EG
Group operates, accounting for about 70% of the group earnings.
This provides natural hedging to the group's multi-currency
borrowings (about 50% in euros, 40% in U.S. dollars, and 10% in
pounds sterling).

"We see relatively low execution risks on the integration of
Kroger fuel stations and convenience stores, given that they are
profitable sites. However, frequent acquisition activities limit
our visibility on earnings and cash flow. After the transaction,
we anticipate that over 50% of the group profits relate to recent
acquisitions in the U.S., Netherlands, Germany, and Italy. All of
these are new regions for EG Group and will only be fully
consolidated in 2019, entailing the risk of an unexpected
earnings shortfall.

"Our current ratings are mainly supported by our expectation of
substantial deleveraging to about 6.5x debt to EBITDA in 2019 and
toward 6x in 2020. This is driven by the group's planned roll-out
of food-to-go sites of about 140-160 a year, which is done on top
of the achieved roll-out on existing U.K. and continental
European sites of around 170 in 2017. Deleveraging will be
further supported by labor cost reduction in the acquired U.S.
business, as well as our expectation of lower exceptional costs
from 2019.
We anticipate that management would focus on consolidating recent
acquisitions over the next couple of years. Given minimal ratings
headroom under the credit metrics, further opportunistic
acquisitions and capital expenditure (capex) could raise the
downside risk that the deleveraging and cash flow generation
expectations do not materialize.

"Overall, we view the announced acquisition as complementary to
EG Group's existing business. The Kroger C-store business is a
combination of petrol filling stations and convenience retail
offerings. This operation benefits from longstanding regional
brands and a long track record of same store sales growth. With
around 762 Kroger C-stores, we believe that it has the scale to
remain profitable in the long term. The Kroger C-store
acquisition also involves substantial overhead functions, which
was not the case in the acquisition of the around 2,200 petrol
filling station sites from Exxon Mobil in Italy and Germany.

"We acknowledge that the U.S. acquisition improves the geographic
diversification of the business into North America, which we see
as being offset by short-term execution risks that could weigh on
profitability. At the same time, in our view, the overall size
and scale advantage will not immediately result in materially
better negotiation power as suppliers, especially in retail, are
different between North America and Europe.

"Additionally, we see increasing fuel efficiency and the rising
proportion of hybrid and electric cars as a longer-term threat to
fuel station operators. This could likely result in reduced
footfall on EG Group's sites, given lower needs to refuel and
alternative and competing methods of charging infrastructure for
electric cars, for example charging in private homes, public
parking lots, or other general facilities.

"We note that e-mobility is encouraged by government policies
such as the U.K.'s planned ban of new diesel and petrol cars by
2040. However, we do not expect any material effect on EG Group's
business over the next five to seven years, given the longer-term
time horizon of these changes and the low current share of
electric cars (below 1% in the largest European markets).
Furthermore, EG Group has initiated cooperation with car
manufacturers to install fast-charging stations on some sites to
participate in e-mobility in the future."

The group aims to use its diverse non-fuel offerings in
convenience retail and food-to-go segments to attract and
increase footfall and spending, and lower the reliance on
earnings from fuel sales. Management intends to accelerate the
roll-out of retail and food offerings in the acquired businesses,
which currently have lower nonfuel penetration. Overall, S&P
expects the group to generate about 45% of its profit margin in
nonfuel after the acquisitions, which it aims to increase toward
two thirds, as this is already the case in its existing U.K.
business.

The proposed acquisitions will result in high S&P Global Ratings-
adjusted debt of EUR5.7 billion in 2018, mainly comprising EUR4.9
billion of term loans and about EUR700 million of the present
value of operating lease commitments. S&P's adjusted debt and
ratio calculations exclude the EUR555 million structurally
subordinated and pay-in-kind preferred shares issued above the
restricted group and held by joint shareholder TDR Capital that
it considers similar to equity.

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

-- The U.K.'s vote to leave the EU resulting in a drag on the
    U.K. economy, with mild GDP growth in 2018-2020 of 1.0%-1.5%,
    coupled with continued sterling weakness; eurozone GDP being
    less constrained by Brexit and increasing by around 1.5%-
    2.0%; the U.S. economy is expected to expand by 2.3%-2.8%
    over the same time period.

-- An increase in fuel volume sold of 0.5%-1.0% per year, driven
    by the roll-out of new sites but also hampered by increasing
    fuel efficiency and slowly emerging e-mobility. Overall, this
    should translate into revenue growth of 1% for the fully
    combined business, which also benefits from the roll-out of
    at least 100 additional food-to-go offerings per year.

-- An expected group fuel margin of 5.2-5.8 cents per liter and
    15.0-15.5 billion liters of fuel sales translating into fuel
    gross profits of EUR800 million-EUR850 million pro forma of
    acquisitions in 2018-2019 compared with about EUR380 million
    in 2017, supported by around EUR470 million in gross profits
    per year from acquisitions.

-- S&P Global Ratings-adjusted EBITDA margin temporarily
    weakening to 5.6% in 2018, given restructuring and
    transaction costs in 2018, but subsequently recovering to
    about 6% in 2019-2020. This will be still below the 7%
    achieved in 2017, given the higher share of lower-margin fuel
    business in acquired businesses in Germany and Italy.

-- S&P Global Ratings-adjusted EBITDA of about EUR630 million-
    EUR680 million in 2018, based on only partial consolidation
    of acquired businesses in the U.S., Italy, and Germany, as
    well as acquisition-related costs. This should increase to
    EUR850 million-EUR890 million in 2019, and EUR930 million-
    EUR970 million in 2020 based on the full integration of the
    new acquisitions and earnings growth.

-- Annual capex of about EUR150 million-EUR160 million in 2018,
    rising to EUR160 million-EUR180 million in 2019 and 2020.

-- No further acquisitions or shareholder remuneration.

Based on these assumptions, S&P arrives at the following S&P
Global Ratings-adjusted credit measures:

-- Debt to EBITDA on a pro-forma basis of around 7.0x in 2018
   (or around 9x on an actual basis), improving to about 6.5x in
    2019 and 6.0x in 2020 on the back of full consolidation of
    acquired businesses and earnings growth.

-- Reported EBITDA before rent (EBITDAR) cash interest plus rent
    coverage of around 2.0x in 2018-2020.

-- Weak reported FOCF to debt less than 5% in 2018 due to
    exceptional and transaction costs. This could improve to
    around 10% in 2019 absent further acquisitions and capex.

The negative outlook reflects EG Group's aggressive financial
policy of debt-funded acquisitions. It also takes into account
the group's minimal headroom under the current credit metrics to
withstand any unexpected operating weakness or shortfalls in fuel
margins or volume over the next 12 months. It also reflects the
expected increase in EG Group's pro-forma leverage after the
transaction to around 7x in 2018, with weaker cash generation
over the next 12 months.

S&P said, "We could revise the outlook back to stable if the
group deleverages below 7.0x on the back of strong reported FOCF
on a sustainable basis. This could arise if the group soundly
executes its acquisition integration without further acquisition.
This would be accompanied by greater visibility on financial
policy in relation to capex, acquisitions, and shareholder
returns.

"We could lower the rating if EG Group does not improve our
adjusted debt to EBITDA to below 7.0x in 2019 or if reported FOCF
turns negative. This could arise if, for example, the group
experiences unexpected setbacks in acquisition-related
integration, synergies realization, or earnings shortfall derived
from unexpected fuel volume and margin fluctuation. Rating
downside could also rise if the group overspends on capex, or
further debt-funded opportunistic acquisitions that we view as
weakening the group's credit profile."


ELYSIUM HEALTHCARE: Moody's Assigns B3 CFR, Outlook Stable
----------------------------------------------------------
Moody's Investors Service has assigned a first-time B3 corporate
family rating (CFR) and a B3-PD probability of default rating
(PDR) to Elysium Healthcare Holdings 2 Limited (Elysium), an
operator of behavioural healthcare facilities in England and
Wales. The rating agency has concurrently assigned B3 ratings to
the new GBP275 million senior secured term loan due 2025 and new
GBP55 million senior secured revolving credit facility (RCF) due
2024 to be borrowed by Elysium Healthcare Holdings 3 Limited. The
outlook on all ratings is stable.

The company plans to use the proceeds from the term loan and from
the additional common equity of GBP42 million to refinance the
existing GBP223.98 million senior secured term loan and GBP25
million drawn under its capex facility (all unrated), spend GBP64
million on three upcoming acquisitions, and have opening cash of
around GBP9.1 million to finance the development of existing and
new site developments. The GBP24 million from the GBP275 million
term loan and GBP25 million from the GBP42 million equity are
contingent on one acquisition and are on a delayed draw.

The rating action reflects the following interrelated drivers:

- The company's leverage, as measured by Moody's-adjusted
debt/EBITDA, is high at 6.8x pro forma for the refinancing and
upcoming acquisitions;

- Moody's expects no meaningful deleveraging because of the
company's acquisitive growth and staff cost pressures;

- Mainly as a result of several acquisitions Elysium has notably
(by 48%) increased its scale in terms of revenue to GBP202.9
million in 2017 from GBP136.7 million in 2016 (both pro forma for
the annualized contributions from acquisitions) as well as
regional diversification and a variety of offered behavioural
healthcare services;

- The company has demonstrated a good track record as a
standalone operator since its carve-out from Acadia Healthcare
Company, Inc. (LT corporate family rating B1 Stable) in November
2016.

RATINGS RATIONALE

Elysium's B3 CFR reflects the company's: 1) leading positions in
behavioural healthcare services in England and Wales; 2) good
underlying fundamental trends, including growing and ageing
population, improving diagnostics, increasing awareness and
acceptance of behavioural healthcare services; 3) high proportion
of good or outstanding regulatory scores for its facilities; and
4) high proportion of long-term (2-3 years) patients.

Conversely, the rating reflects the company's: 1) high leverage
of 6.8x pro forma for the completed and upcoming acquisitions of
several behavioural healthcare facilities with no meaningful
deleveraging over the next two years; 2) high exposure to public
payers and, as a result, to their budgetary and regulatory
constraints; 3) high exposure to staff cost pressures and
shortages given the supply and demand imbalance for nurses; 4)
reduced but still high concentration of revenue with top six
facilities representing around 45% of revenue in 2017; and 5)
reasonably aggressive financial policy, including acquisitive
growth.

RATING OUTLOOK

The stable outlook reflects Moody's expectation that Elysium's
leverage, as measured by Moody's-adjusted debt/EBITDA, will not
reduce meaningfully for the next two years. The outlook also
assumes that the company will have no excessive releveraging,
dividend recapitalisations, or sale and leaseback transactions.

FACTORS THAT COULD LEAD TO AN UPGRADE

The company's leverage, as measured by Moody's-adjusted
debt/EBITDA, were to decrease below 6.0x sustainably; and

Its annual free cash flow were to exceed GBP15 million.

FACTORS THAT COULD LEAD TO A DOWNGRADE

Leverage were to increase materially from the current high level;

The company were to have negative free cash flow for a prolonged
period;

Concerns over liquidity were to arise; or

The company's performance were to deteriorate leading to losses
of large contracts and/or lower regulatory CQC's scores.

LIQUIDITY ANALYSIS

Pro forma for the refinancing, Elysium's liquidity is adequate
and supported by no debt amortizations until 2025, undrawn GBP55
million RCF, and opening cash of around GBP29.4 million. The
company will maintain sufficient headroom under its maintenance
net senior secured leverage covenant.

STRUCTURAL CONSIDERATIONS

The B3 ratings of the senior secured facilities in line with the
B3 CFR and the B3-PD PDR reflect Moody's 50% corporate family
recovery rate assumption. The notes and loans borrowed by Elysium
Healthcare Holdings 2 Limited from its immediate parent Elysium
Healthcare Holdings 1 Limited comply with Moody's criteria for
equity treatment.

LIST OF ASSIGNED RATINGS

Issuer: Elysium Healthcare Holdings 2 Limited

Assignments:

-- LT Corporate Family Rating, Assigned B3

-- Probability of Default Rating, Assigned B3-PD

Outlook Action:

-- Outlook, Assigned Stable

Issuer: Elysium Healthcare Holdings 3 Limited

Assignments:

-- BACKED Senior Secured Bank Credit Facility, Assigned B3

Outlook Action:

-- Outlook, Assigned Stable

PRINCIPAL METHODOLOGY

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

PROFILE

Elysium, headquartered in Borehamwood, UK, is an operator of
behavioural healthcare facilities in England and Wales. The
company offers medium-to-low secure, rehabilitation and recovery
and complex care, acute, learning disabilities and neurological
inpatient services to people suffering from a variety of
behavioural health conditions across England and Wales, with pro
forma revenue of GBP202.9 million. The company is majority-owned
by funds managed and advised by BC Partners.


TOYS R US: Fails to Find Buyer, All UK Stores Set to Close
----------------------------------------------------------
BBC News reports that all Toys R Us stores in the UK will close
in the next six weeks following the chain's collapse into
administration.

According to BBC, attempts to find a buyer for the US retailer's
100 stores in the UK have failed.

Twenty-five stores have either closed in recent days or were due
to shut by Thursday, March 14, BBC discloses.

The collapse will put more than 3,000 people out of work as a
dismal period for the retail sector continues, BBC states.

Administrators Moorfields Advisory were appointed last month to
start winding down the UK's biggest toy retailer after it
struggled to pay a GBP15 million tax bill, BBC recounts.

Simon Thomas -- sthomas@moorfieldscr.com -- joint administrator,
said Moorfields' had negotiated with 120 different parties, most
of them interested in buying up stock, and half a dozen looking
at the whole business.  But in the end Mr. Thomas said the
business had simply proved too hard to sell, BBC relates.

He told the BBC: "Any potential purchaser would have difficulty
in sorting things out, for instance getting the rights to use the
name, which is held by the American parent.

"In addition there are many services provided within the group by
different subsidiaries, so if you take over one part you have to
make alternative arrangements or negotiate new terms.  Put all
that together and becomes very complicated."

                        About Toys "R" Us

Toys "R" Us, Inc., is an American toy and juvenile-products
retailer founded in 1948 and headquartered in Wayne, New Jersey,
in the New York City metropolitan area.  Merchandise is sold in
880 Toys "R" Us and Babies "R" Us stores in the United States,
Puerto Rico and Guam, and in more than 780 international stores
and more than 245 licensed stores in 37 countries and
jurisdictions.  Merchandise is also sold at e-commerce sites
including Toysrus.com and Babiesrus.com.

On July 21, 2005, a consortium of Bain Capital Partners LLC,
Kohlberg Kravis Roberts and Vornado Realty Trust invested $1.3
billion to complete a $6.6 billion leveraged buyout of the
company.

Toys "R" Us is a privately owned entity but still files with the
Securities and Exchange Commission as required by its debt
agreements.

The Company's consolidated balance sheet showed $6.572 billion in
assets, $7.891 billion in liabilities, and a stockholders'
deficit of $1.319 billion as of April 29, 2017.

Toys "R" Us, Inc., and certain of its U.S. subsidiaries and its
Canadian subsidiary voluntarily filed for relief under Chapter 11
of the Bankruptcy Code (Bankr. E.D. Va. Lead Case No. Case No.
17-34665) on Sept. 19, 2017.  In addition, the Company's Canadian
subsidiary voluntarily commenced parallel proceedings under the
Companies' Creditors Arrangement Act ("CCAA") in Canada in the
Ontario Superior Court of Justice.  The Company's operations
outside of the U.S. and Canada, including its 255 licensed stores
and joint venture partnership in Asia, which are separate
entities, are not part of the Chapter 11 filing and CCAA
proceedings.

Grant Thornton is the monitor appointed in the CCAA case.

Judge Keith L. Phillips presides over the Chapter 11 cases.

In the Chapter 11 cases, Kirkland & Ellis LLP and Kirkland &
Ellis International LLP serve as the Debtors' legal counsel.
Kutak Rock LLP serves as co-counsel.  Toys "R" Us employed
Alvarez & Marsal North America, LLC as its restructuring advisor;
and Lazard Freres & Co. LLC as its investment banker.  It hired
Prime Clerk LLC as claims and noticing agent.  A&G Realty
Partners, LLC, serves as its real estate advisor.

On Sept. 26, 2017, the U.S. Trustee for Region 4 appointed an
official committee of unsecured creditors.  The Committee
retained Kramer Levin Naftalis & Frankel LLP as its legal
counsel; Wolcott Rivers, P.C. as local counsel; FTI Consulting,
Inc. as financial advisor; and Moelis & Company LLC as investment
banker.


TULLOW OIL: S&P Raises Long-Term ICR to 'B+', Outlook Stable
------------------------------------------------------------
S&P Global Ratings raised its long-term issuer credit rating on
U.K.-based oil and gas producer Tullow Oil to 'B+' from 'B'. The
outlook is stable.

S&P also raised its rating on Tullow's senior secured debt to
'B+' from 'B', and its rating on its senior unsecured debt to 'B'
from 'B-'.

In addition, S&P assigned a 'B' rating to the company's proposed
$650 million senior unsecured notes.

The upgrade follows Tullow's balance-sheet deleveraging process,
which started in 2017 and will likely accelerate this year. S&P
said, "In our view, favorable year-to-date oil prices and our
current oil price assumption for the rest of 2018 ($60 per barrel
[/bbl] versus our previous working assumption of $55/bbl),
proceeds from agreed divestments, and cost cutting initiatives
underpin the current positive momentum. At the same time, the
company continues to take a proactive approach to mitigating
downside risk with hedges and adequate liquidity."

S&P said, "We now project free operating cash flow (FOCF) in 2018
of more than $700 million (including proceeds from the sale of a
stake in its project in Uganda), compared with our previous
forecast of about $400 million. With no material changes in the
capital expenditure (capex) budget and without a resumption in
dividends, the company would be able to quickly reduce its
absolute debt level while building headroom at the current rating
level that should last into 2019. We also foresee a further
improvement in Tullow's cash flow capacity stemming from higher
production from the Ghanaian assets, where production costs are
lower."

Over the last 12 months, the company has taken several actions
that have strengthened its balance sheet, and built some cushion
to absorb potential market volatility. These steps include:

-- A US$721 million net equity injection earlier this year.

-- The Uganda project farm down, dropping its stake to 10% from
    33% in exchange for $900 million, including $200 million in
    cash and the balance as deferred consideration). Most of the
    cash component is expected later in 2018 with the completion
    of the deal. S&P also notes Tullow's divestment of its Dutch
    assets.

-- Refinancing its reserve base lending (RBL) facility, creating
    a comfortable debt maturity profile.

-- Commissioning the ramp-up of the TEN project with potentially
    higher volumes in the coming years as the company recommenced
    drilling.

S&P said, "We project adjusted funds from operations (FFO) to
debt of about 20% in 2018 and 2019, compared with our previous
projection of 15%-17% (adjusted FFO to debt in 2017 was about
15%). We view FFO to debt of 15%-20% as commensurate with the
'B+' rating through the cycle, depending on the company's
investment cycle and oil prices."

"Under our base case, we project that Tullow's adjusted EBITDA
will be $1.5 billion-$1.6 billion in 2018, compared with our
previous assumption of $1.1 billion-$1.2 billion. Looking into
2019, we expect the adjusted EBITDA to decline to about $1.2
billion-$1.4 billion, driven mainly by our working assumption of
lower oil prices and ramp up of TEN.

"The stable outlook reflects Tullow's ability to deleverage and
gradually build additional rating headroom--allowing it to
tolerate some future volatility in oil prices--as well as invest
in growth over the medium term. For 2018, we expect strong FOCF,
stemming from the recovery in oil prices and higher production
from Ghana, which should continue in 2019.

"We believe that rating headroom should offset pressure on the
rating over the short term. The ongoing balance-sheet
deleveraging, the current supportive crude oil prices, and the
company's hedges for 2018 support our view.

"Under our base case, with our working assumption for oil of
$60/bbl for the rest of 2018 and $55/bbl in 2019, we expect
adjusted FFO to debt of about 20% both in 2018 and in 2019, with
some upside if oil prices remain at current levels (about
$65/bbl).

"We view FFO to debt of 15%-20% as commensurate with the rating,
albeit depending on the company's investment cycle and oil
prices. For example, during periods of neutral FOCF (for example
high capex spending and/or low oil prices), adjusted FFO to debt
could be at the lower part of the range. On the other hand,
during periods of positive FOCF (for example elevated oil prices
and/or low capex), we would expect the company to have adjusted
FFO to debt at least at the higher part of the range."

Over time, S&P could see pressure building on the rating if FFO
to debt fell toward 15% or below coupled with negative FOCF. Such
a scenario could happen if S&P saw:

-- Delays at the TEN project or issues at the Jubilee field that
    hampered production growth;

-- A lasting and material decline in oil prices (for example,
    below $50/bbl). In this scenario, the hedges currently in
    place would provide only temporary relief; or

-- Returning to a heavy capex mode (in 2015 Tullow's capex was
    about $2 billion, coming down to $1 billion in 2016 and about
    $0.3 billion in 2017).

S&P said, "In addition, we may decide to lower the rating if we
revised down our assessment of Ghana's current 'B' T&C
assessment.

"At this stage, we see very limited rating upside in the coming
12 months because of Ghana's current 'B' T&C assessment, which
would prevent us from raising the rating on Tullow above 'B+'
given the current portfolio concentration. We may lift the
current cap if the company expanded its footprint outside Ghana.
However, this is not expected over the medium term.

"If we revised the T&C assessment upward, a higher rating would
likely be supported by adjusted FFO to debt comfortably above
20%, with positive FOCF supporting a further reduction in the
company's absolute debt level."



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


* EU Commission Proposes New Measures for Banks with Bad Loans
--------------------------------------------------------------
Francesco Guarascio at Reuters reports that the European
Commission has proposed new measures to force banks to set aside
more money against new loans turning bad and to favor offloading
their existing stocks of bad debt, in a bid to reduce risks in
the bank sector.

The proposals follow others put forward in recent months to raise
capital requirements, set new loss-absorbing buffers and
facilitate the orderly liquidation of failing lenders, all of
which Brussels believes will make the bloc's banks safer after
many of them were rescued with taxpayers' money during the
financial crisis, Reuters notes.

According to Reuters, the new measures to reduce banks' exposure
to so-called non-performing loans (NPLs) could bolster the case
of EU states pushing to set up a common bank deposit insurance
which would spread risk across the bloc.  This idea is opposed by
Germany and other countries who fear they may have to bankroll
losses at weaker lenders in other states, Reuters relays.

The latest proposal introduces common minimum levels for the
amount of money banks need to set aside to cover losses caused by
new loans originated from Wednesday that turn non-performing,
confirming an earlier Reuters report.

The commission had considered, but dismissed, the option of
postponing the date at which new loans would be covered by the
proposed stricter measures to when the proposal is approved by EU
states and legislators, which could take several months, Reuters
discloses.

Despite criticism, the proposed measures avoid introducing new
provisioning requirements for existing bad loans, which could
have forced fire-sales of bad debt by banks more exposed to them,
leaving large holes in their balance sheets, Reuters notes.

They also give banks one year more to cover losses from secured
loans compared to a European Central Banks' plan that triggered
criticism, according to Reuters.

Under the proposal, which needs the approval of EU states and
lawmakers, banks will have two years to fully cover potential
losses from new loans that are not backed by a collateral,
Reuters says.

For secured loans, lenders will have eight years, instead of the
seven proposed by the ECB, to fully cover losses with gradual
increases from a minimum 5% coverage in the first year to 27.4%
in the fourth year and 75 percent in the seventh year, Reuters
states.

The EU executive is also proposing measures to facilitate the
offloading of the existing stock of bad loans, which large banks
welcomed, Reuters discloses.

Under the plan, banks in all 28 EU countries will be able to
agree with corporate borrowers an accelerated out-of-court
mechanism to recover the collateral in case loans turn bad,
according to Reuters.


* BOOK REVIEW: AS WE FORGIVE OUR DEBTORS
----------------------------------------
Authors: Teresa A. Sullivan, Elizabeth Warren,
& Jay Westbrook
Publisher: Beard Books
Softcover: 370 Pages
List Price: $34.95
Review by: Susan Pannell
Order your personal copy today at
http://www.beardbooks.com/beardbooks/as_we_forgive_our_debtors.ht
ml

So you think you know the profile of the average consumer debtor:
either deadbeat slouched on a sagging sofa with a three day
growth on his chin or a crafty lower-middle class type opting for
bankruptcy to avoid both poverty and responsible debt repayment.
Except that it might be a single or divorced female who's the one
most likely to file for personal bankruptcy protection, and her
petition might be the last stage of a continuum of crises that
began with her job loss or divorce. Moreover, the dilemma might
be attributable in part to consumer credit industry that has
increased its profitability by relaxing its standards and
extending credit to almost anyone who can scribble his or her
name on an application. Such are among the unexpected findings in
this painstaking study of 2,400 bankruptcy filings in Illinois,
Pennsylvania, and Texas during the seven-year period from 1981 to
1987. Rather than relying on case counts or gross data collected
for a court's administrative records, as has been done elsewhere,
the authors use data contained in the actual petitions. In so
doing, they offer a unique window into debtors' lives.

The authors conclude that people who file for bankruptcy are, as
a rule, neither impoverished families nor wily manipulators of
the system. Instead, debtors are a cross-section of America. If
one demographic segment can be isolated as particularly
debtprone, it would be women householders, whom the authors found
often live on the edge of financial disaster. Very few debtors
(3.7 percent in the study) were repeat filers who might be viewed
as abusing the system, and most (70 percent in the study) of
Chapter 13 cases fail and become Chapter 7s. Accordingly, the
authors conclude that the economic model of behavior -- which
assumes a petitioner is a "calculating maximizer" in his in his
decision to seek bankruptcy protection and his selection of
chapter to file under, a profile routinely used to justify
changes in the law -- is at variance with the actual debtor
profile derived from this study.

A few stereotypes about debtors are, however, borne out. It is
less than surprising to learn, for example, that most debtors are
simply not as well-off as the average American or that while
bankrupt's mortgage debts are about average, their consumer debts
are off the charts. Petitioners seem particularly susceptible to
the siren song of credit card companies. In the study sample,
creditors were found to have made between 27 percent and 36
percent of their loans to debtors with incomes below $12,500
(although the loans might have been made before the debtors'
income dropped so low). Of course, the vigor with which consumer
credit lenders pursue their goal of maximizing profits has a
corresponding impact on the number of bankruptcy filings.

The book won the ABA's 1990 Silver Gavel Award. A special 1999
update by the authors is included exclusively in the Beard Book
reprint edition.



                            *********

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 * * *