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

                           E U R O P E

          Tuesday, November 20, 2018, Vol. 19, No. 230


                            Headlines


F R A N C E

RAMSAY GENERALE: S&P Affirms 'BB-' Long-Term ICR, Outlook Stable


G E R M A N Y

DEMIRE DEUTSCHE MITTELSTAND: S&P Affirms 'BB' ICR, Outlook Stable


G R E E C E

TITAN CEMENT: S&P Alters Outlook to Neg. & Affirms 'BB+/B' ICRs


H U N G A R Y

MAGYAR TAKAREKBANK: S&P Affirms 'BB/B' ICRs, Outlook Stable


I R E L A N D

ADIENT PLC: Fails to Report Problems in SS&M Business, Hyder Says
AURELIUS EURO 2008-1: S&P Cuts Ratings on 2 Note Classes to D
IRELAND: Bailout Inspectors See "Signs of Overheating"


I T A L Y

TELECOM ITALIA: S&P Affirms 'BB+/B' ICRs, Outlook Stable


P O L A N D

GETIN NOBLE: Poland Vows to Provide Support Following Scandal


R U S S I A

CB MOSKVA: Put on Provisional Administration, License Revoked
UM-BANK LLC: Put on Provisional Administration, License Revoked


U K R A I N E

KYIV CITY: S&P Affirms 'B-' Long-Term ICR, Outlook Stable


U N I T E D   K I N G D O M

ELYSIUM HEALTHCARE 2: S&P Alters Outlook Negative & Affirms B ICR
FLYBE: Calls in KPMG Amid Financial Woes
HOUSE OF FRASER: Closes Four More Stores After Failed Intu Deal
LERNEN BONDCO: S&P Assigns 'B-' Long-Term ICR, Outlook Stable
PATISSERIE VALERIE: Parent Firm Names Stephen Francis as New CEO

THEATRE HOSPITALS NO.1: S&P Puts CMBS Notes Ratings on Watch Neg.


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F R A N C E
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RAMSAY GENERALE: S&P Affirms 'BB-' Long-Term ICR, Outlook Stable
----------------------------------------------------------------
S&P Global Ratings said that it affirmed its 'BB-' long-term
issuer credit rating on French private hospitals operator Ramsay
Generale de Sante (RGDS). The outlook is stable.

S&P said, "At the same time, we affirmed our 'BB-' issue and '3'
recovery ratings on RGDS's EUR1.6 billion senior secured term
loan B, including the proposed EUR750 million add-on. Our
recovery rating of '3' reflects our expectation of meaningful
recovery (50%-70%; rounded estimate: 60%) in the event of a
payment default."

The affirmation follows RGDS's acquisition, on Nov. 7, 2018, of
the majority of Sweden-based hospitals operator Capio AB. RGDS
funded the acquisition with a combination of incremental debt of
EUR750 million and an equity injection of about EUR550 million
from its ultimate parents, Ramsay Healthcare Ltd. (RHC) and
French life insurance company Predica. RHC injected EUR314
million into RGDS to help finance the transaction, with Predica
providing the remaining amount. As such, RHC remains the majority
owner post the transaction. On Nov. 14, 2018, Capio's application
for de-listing from Nasdaq Stockholm was approved, allowing RGDS
to pursue the buy-out of Capio. S&P understands that the squeeze-
out of minority shareholders holding 1.49% of Capio will lead
RGDS to own 100% of Capio's shares by April 2019.

In S&P's view, the acquisition will improve the combined group's
scale and the diversification of its reimbursement profile.
However, these improvements will be partly offset by integration
risks and a continued challenging operating environment in the
group's main market of France, and in some of its smaller markets
such as Germany. At the same time, Capio's leasehold operating
model and lower margins will dilute the combined group's
profitability. That said, RGDS remains mainly focused on France,
where it derives more than 70% of its revenues pro forma the
acquisition, and, as such, continues to rely on the French
government as the main payer. Therefore, S&P sees limited upside
potential for RGDS's business risk profile at this stage.

The combination creates the second-largest acute health care
services player in Europe, after Fresenius SE & Co. KGaA, and
strengthens RGDS's position in France as the largest private
hospitals operator following the merger of Generale de Sante and
Ramsay SantÇ in late 2015. Following the integration of Capio,
the No. 3 player in France and the leader in Sweden, the combined
group will operate 300 facilities spanning six countries
including France, Sweden, Norway, Germany, Denmark, and Italy. By
combining both entities, S&P expects RGDS to reach a revenue base
of EUR3.8 billion, ahead of ELSAN, the next largest player in
France, with EUR2.1 billion. S&P understands that RGDS is now the
largest private hospitals operator in France in terms of
geographic coverage and number of facilities, with a market share
in medicine, surgery, and obstetrics (MSO) of approximately 23%.

S&P said, "We view positively the increased scale of the combined
entity, as it is crucial for health care services providers to
improve institutional visibility among all stakeholders in the
sector. Besides, the combination makes sense since the two
entities strongly complement each other geographically, as Capio
has a strong presence in the French region of Nouvelle Aquitaine,
which is a new region for RGDS, as well as in Lyon and Toulouse,
strengthening RGDS's local presence in France. More importantly,
we view as positive RGDS's entry into the Nordics, where there is
potential for higher organic growth (historically on average
about 2%-3%), due to a different market structure. This will help
RGDS to generate sustainable volumes and margins to offset the
negative pressure on tariffs in France.

"We also expect that RGDS will be able to recoup cost synergies
in the French business, mainly from procurement, allowing it to
absorb the integration and Capio's restructuring costs.
However, this will not offset the relatively large dilutive
impact of Capio, which reported an EBITDAR margin of about 12% in
the 12 months to end-September 2018. In our view, Capio's lower
margins relate to the different market structure in the Nordics
combined with the challenging performance of the German
operations over the past few quarters.

"We project that the combined group will generate an S&P Global
Ratings-adjusted EBITDAR margin of about 17%, while the EBITDA
margin after rental payments will be only at about 9.6%." This
compares unfavorably with the ratios of RGDS's closest peer ELSAN
SAS, which had EBITDAR margins of close to 20% in 2017.

In terms of volumes, the operating environment offers good
visibility of demand, thanks to an aging population and an
increasing number of medical interventions per patient. In
France, about 90% of RGDS's revenues come directly from the
national social security system, thereby limiting exposure to bad
debt. S&P said, "We expect France to keep up with incremental
economic reforms in the medium term, including a focus on health
care costs. In this context, we project that RGDS's tariffs will
remain under pressure for the next two years, although the strain
could ease. The government lowered tariffs by 0.5% in 2018
following cuts of 0.9% in 2017 (excluding the prudential ratio)."

The business mix will not change materially following the
acquisition, with MSO continuing to represent more than 80% of
the combined group's revenues on a pro forma basis. Capio brings
its focus on specialty procedures such as hip and knee
replacements, as well as its strong experience in primary care.
S&P also expects that the combined group will continue acquiring
clinics to further consolidate the private hospitals market in
Europe, in line with the parent's stated strategy.

S&P said, "RGDS operates mostly under a leasehold model, which we
view negatively because health care services providers are price-
takers and rents add to already-high fixed costs. In our view,
this could put further pressure on profitability on top of the
constrained growth prospects for the health care services
industry.

"We project that adjusted EBITDA before rental payments will be
in the range of EUR570 million-EUR650 million over the next 24
months, covering interest payments of EUR70 million and rent
payments of EUR270 million by 1.9x. As such, RGDS will be able to
service its fixed charges comfortably. However, given the high
proportion of fixed costs, including rent payments, we consider
that any structural operational issues could hinder RGDS's
ability to cover its fixed costs."

Under S&P's base-case scenario, it projects that adjusted debt
will be about 5.2x-5.4x by the end of 2019, improving slightly to
below 5x by the end of 2020, as the group benefits from the
combined EBITDA and cash flow.

After the acquisition of Capio, S&P's debt calculation includes
about EUR2.1 billion of financial debt, including the proposed
issuance of a EUR750 million add-on to the existing term loan,
and about EUR1.3 billion of operating leases. S&P deducts about
EUR400 million of cash that we expect to be available.

S&P's base-case assumptions for RGDS are as follows:

-- French GDP growth of 1.6% in 2019, staying at the same level
    in 2020. S&P uses GDP as an indication of the state's
    willingness to pay for health care, because of the
    nondiscretionary nature of health care.

-- Continued efforts by the French government to curb health
    care expenditure in accordance with deficit-cutting measures.
    However, pressure on tariffs should be more subdued than in
    the past two years.

-- A rise in RGDS's organic revenue growth by 1%-2% in 2019,
    which would slightly improve through acquisitions and
    expansion capital expenditures (capex).

-- Organic growth in 2019, which should arise from procedure mix
    and volume growth, helped by the recruitment of new
    practitioners, and just offsetting tariff pressure. S&P also
    factors in the positive impact from RGDS's entry into the
    Nordics market.

-- A stable EBITDAR margin of about 17% in 2019, helped by
    synergies and cost efficiencies.

-- Capex of 4%-5% of revenues per year, reflecting RGDS's
    constant investments in its operating base, that is, medical
    equipment or process improvement tools.

-- Bolt-on acquisitions as part of the consolidation process in
    the French and Nordics health care services industry.

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

-- Adjusted debt to EBITDA of about 5.0x, on average, over the
    next two years, pro forma the Capio acquisition.

-- A fixed-charge coverage ratio of 1.9x on average over the
    next two years, pro forma the Capio acquisition.

S&P said, "We view RGDS's liquidity as adequate, indicating that
sources of cash will cover uses by at least 1.2x over the next 12
months. Even if EBITDA were to decline by 15%-20%, we think that
net sources would remain positive. Although sources of liquidity
exceed uses by enough to qualify for a stronger liquidity
assessment, we assess liquidity as adequate because the group is
likely to participate in the ongoing consolidation in the
industry. This could lead to cash outflows that are higher than
those we factor into our base case."

Principal Liquidity Sources

-- Cash and cash equivalents of about EUR400 million pro forma
    the Capio acquisition;

-- FFO exceeding EUR250 million; and

-- S&P's estimate of the undrawn portion of the committed
    revolving credit facility (RCF) of EUR100 million and capex
    and acquisition facilities of EUR40 million, both expiring in
    2020.

Principal Liquidity Uses

-- Capex of about EUR180 million annually;

-- Negative working capital outflows of EUR35 million-EUR40
    million; and

-- Limited acquisitions in 2019 and bolt-on acquisitions
    thereafter.

S&P said, "The stable outlook reflects our expectation that RGDS
will successfully integrate Capio into its operations, while
generating positive organic growth in both businesses, and
focusing on margin improvement. This should lead to adjusted
EBITDA of about EUR600 million-EUR650 million and positive free
operating cash flow (FOCF), enabling a reduction of adjusted
leverage below 5x by fiscal year-end 2020.

"We would consider lowering the ratings if we believed that the
group would not be able to reduce adjusted leverage below 5x by
the end of 2020." The most likely cause of such inability would
be a deterioration in operating performance, as a result of:

-- Higher-than-expected costs associated with the integration of
    Capio into RGDS;

-- A deterioration in the operating environment in the group's
    main markets of France and Sweden, putting pressure on
    margins; or

-- A decline in the group's ability to generate sizable FOCF due
    to working capital outflows or higher capex than S&P expects.

S&P could raise the ratings if the group's servicing of its fixed
obligations, such as interest and rent payments, strengthens to
above 2.2x, or if it reduces and maintains adjusted leverage at
about 4x.


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DEMIRE DEUTSCHE MITTELSTAND: S&P Affirms 'BB' ICR, Outlook Stable
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S&P Global Ratings said that it had affirmed its 'BB' long-term
issuer credit rating on German-based real estate company DEMIRE
Deutsche Mittelstand Real Estate AG (DEMIRE). The outlook is
stable.

S&P said, "We also affirmed our 'BB+' issue rating on DEMIRE's
senior unsecured debt. The '2' recovery rating continues to
indicate our expectation of 70%-90% (rounded estimate: 85%)
recovery prospects in the event of a payment default.

"The affirmation mainly reflects our view that DEMIRE will
continue executing its strategy to grow its portfolio to EUR2
billion by 2020, therefore increasing its scale and the scope of
the portfolio, taking also into account the recently announced
acquisition of about EUR167 million this month. In addition, we
understand that DEMIRE targets a reported net loan-to-value ratio
close to 50% (translating into a S&P Global Ratings-adjusted
ratio of debt to debt plus equity of about 55%), in line with the
company's publicly announced midterm objectives.

"The affirmation also reflects our revised view on DEMIRE's
majority shareholder, AEPF III 26 S.a.r.l, an affiliate of Apollo
Global Management LLC, which now owns 64.07% of DEMIRE, versus
49% previously, following DEMIRE's capital increase of EUR150
million (gross proceeds) or 47% of DEMIRE's equity. Apollo,
through AEPF III 26, has taken over majority control of DEMIRE's
voting rights. In addition, and contrary to our previous
assumptions, the shareholding of Wecken Group was diluted to 23%
from 33%. Following the quickly accelerating increase in Apollo's
shareholding in DEMIRE and our limited visibility on Apollo's
investment horizon into DEMIRE, we have changed our financial
policy modifier to financial sponsor-5. This reflects our view
that DEMIRE could be pushed toward more aggressive leverage or
redevelopment of cash flow proceeds than listed companies with a
material free float, for example.

"That said, our rating on DEMIRE continues to incorporate one
notch of uplift from the anchor, based on our comparable ratings
analysis. In our view, this reflects DEMIRE's growth strategy,
which should enhance and diversify its portfolio further while
keeping vacancy rates below 10%.

"We forecast the company's portfolio will grow to about EUR1.4
billion by the first quarter of 2019, including its recent signed
acquisitions of a portfolio of four office properties for a total
of EUR167 million. The assets fit well within DEMIRE's current
portfolio, focusing on secondary locations in Germany surrounding
metropolitan areas.

"In our base-case, we expect DEMIRE's ratio of debt to debt plus
equity will be around 52%-55% by year-end 2018, including the
recent announced acquisitions. We forecast that the EBITDA
interest coverage will improve to about 1.7x in 2018 and to above
2x in 2019, thanks to a balanced mix between equity- and debt-
financed transactions and improvement of its average cost of debt
to 3% as of Sept. 30, 2018, from 4.1% in June 2017."

S&P's base case assumes:

-- Low GDP growth for Germany of 1.7% in 2019, and 1.5% in 2020,
    with unemployment remaining below 5%.

-- Approximately 1.5%-2% like-for-like rental income growth,
    stemming mainly from improved occupancy in DEMIRE's existing
    portfolio and some minor rent increases from new leases or
    existing lease contracts, as well as favorable supply-and-
    demand conditions in the German commercial market.

-- Annual acquisitions of about EUR150 million-EUR200 million.
    In line with the company's strategy, S&P estimates that the
    income-producing portfolio will grow to about EUR2 billion in
    the next few years.

-- 6%-9% like-for-like portfolio revaluation for DEMIRE's
    properties for full-year 2018 with about EUR70.1 million
    already reached in the first nine months of 2018, and 2%-4%
    like-for-like revaluation the following years, reflecting the
    company's focus on midsize secondary locations where real
    estate prices are growing less than in large metropolitan
    areas.

-- Average cost of debt at about 3.0%.

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

-- The EBITDA-to-interest ratio of about 1.7x in 2018 and around
    2.2x in 2019.

-- Debt to debt plus equity to remain 52%-55% in the next 12
    months.

S&P said, "The stable outlook reflects our view that DEMIRE's
property portfolio across different segments should generate
stable cash flows over the next 12 months. Our view is based on
the fact that the majority of DEMIRE's properties in secondary
locations are near metropolitan areas across Germany, where
demand trends are favorable and where occupancy should improve
further, in line with the company's strategy.

"The outlook also reflects our expectation that the company will
continue to execute its announced strategy in the next few
months.
We forecast EBITDA interest coverage will improve to above 2x and
debt to debt-plus-equity will decrease to approximately 52%-55%.

"We could lower the rating if the company fails to keep its debt-
to-debt plus equity ratio below 60% and EBITDA interest coverage
of above 2x on a sustainable basis. This situation could
materialize if DEMIRE were to alter its publicly announced policy
to reduce leverage or if the company undertook more debt-financed
acquisitions.

"We could also lower the rating if the company did not manage to
realize its business strategy, resulting in a decline in the
overall portfolio size back to EUR1 billion or below, or
investment in less favorable secondary locations away from
metropolitan hubs. Ratings downside could also develop if the
vacancy rate increases again to 10% or higher, for example
because of weak demand or the acquisition of highly vacant
assets.

"We believe a positive rating action is remote currently.
However, we would view positively a change in the ownership
structure, for example, if the free float of the company's
shareholder structure increases materially, while maintaining a
conservative financial policy in line with a higher rating."


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TITAN CEMENT: S&P Alters Outlook to Neg. & Affirms 'BB+/B' ICRs
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S&P Global Ratings said that it revised to negative from stable
its outlook on Greece-based cement producer, Titan Cement Co.
S.A. (Titan) and its 100% subsidiary, Titan Global Finance PLC
(Titan Global). S&P affirmed its long- and short-term issuer
credit ratings on both entities at 'BB+/B'.

S&P said, "At the same time, we affirmed our 'BB+' issue rating
on all the senior unsecured fixed-rate notes issued by Titan
Global, including EUR287 million due in 2019 (EUR160 million
outstanding), and EUR300 million due 2021, and EUR350 million due
2024. The recovery ratings on the bonds are unchanged at '4',
reflecting our expectation of average recovery (30%-50%; rounded
estimate: 45%) in the event of a payment default.

"The outlook revision reflects that Titan's ratios are likely to
remain weak. We forecast that its S&P Global Ratings-adjusted
funds from operations (FFO) to debt will be about 28% in 2018 (up
from 27.2% in 2017), increasing to 31%-34% in 2019. Although we
consider that its ratios are recovering, we previously expected
them to be above 30% in 2018 and above 35% in 2019.

"At the current 'BB+' level, the rating has minimal headroom for
any underperformance versus our current base-case forecast. We
see heightened uncertainty regarding the pace of the ratios'
recovery, given Titan's exposure to highly volatile and
challenging markets such as Greece, Egypt, Turkey, and Brazil, as
well as the pressure on EBITDA margins due to increasing energy
and raw material costs."

Titan's operating performance in the first nine months of this
year is weaker than in the same period of 2017, with reported
EBITDA down by 8% to EUR196.9 million from EUR214.5 million. This
is mainly due to weak performance in the first half of 2018 in
the U.S., where the group generates about two-thirds of total
EBITDA, due to extremely wet weather, longer-than-planned
maintenance in its Florida plant, and, to a large extent,
significant foreign exchange headwind (especially the weaker
dollar versus the euro). Given improved performance in the third
quarter of 2018 and strong underlying market conditions in the
U.S. and Southeastern Europe, S&P expects the group EBITDA for
2018 will be close to EUR270 million, on par with the EUR273
million in 2017.

S&P said, "We forecast a moderate increase in EBITDA to EUR280
million-EUR290 million in 2019, with the majority of this
increase coming from the U.S. on the back of continuously robust
demand growth and a positive pricing environment, supported by a
solid order backlog. However, we note that the construction
market in the U.S. has been on a positive path since 2011, and it
may soften in the next couple of years. In other regions, we
expect the growth potential in the Southeastern Europe and Brazil
will more or less be offset by the challenging market conditions
in Egypt and Turkey, while we expect the cement market in Greece
will remain flat at a low level. The Egyptian market is facing
significant supply coming on stream and increased levies on
cement products, whilst Turkey is suffering from geopolitical
tensions and a sharp deterioration in the macroeconomic
environment.

"We also expect FFO will benefit from lower interest expense
following the scheduled repayment of the EUR160 million
outstanding bond due in July 2019. As a result, we expect debt to
EBITDA will improve to about 2.5x and FFO to debt to above 30% in
2019, which we view as commensurate with the current rating.
Despite the underperformance versus our forecast in 2017 and
2018, Titan has shown a track record of generating positive free
operating cash flow (FOCF). Moreover, Titan has reached the end
of a period of high investment, and capital expenditure (capex)
will reduce to EUR105 million-EUR110 million in 2018 and 2019
from EUR120 million-EUR150 million in 2016-2017, before further
reducing to about EUR80 million in 2020. This will result in a
continuous strengthening in FOCF generation. However, higher
shareholder distributions than we expect, combined with potential
constrained growth in EBITDA, could jeopardize the recovery of
Titan's credit metrics."

S&P's base case assumes:

-- Slight revenue decline in 2018 followed by modest growth in
    2019, with robust U.S. growth offset by foreign-exchange
    headwinds and challenging core markets such as Greece, Egypt,
    and Turkey dragging on the overall group topline.

-- A modest improvement in Titan's EBITDA margin to 20%-21%,
    supported by careful cost control and the positive pricing
    environment in the U.S. However, energy and raw material cost
    volatility could act as a counterweight to potential margin
    improvement.

-- A slight decrease in capex to EUR105 million-EUR110 million
    in 2018 and 2019.

-- Acquisitions of about EUR20 million-EUR30 million in 2018 and
    2019.

-- Shareholder distributions (dividend and share buybacks) of
    close to EUR50 million in 2018, which S&P expects will
    decrease in 2019.

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

-- FFO to debt of about 28% in 2018, rising to about 31% to 34%
    in 2019;

-- Debt to EBITDA of about 2.8x at the end of 2018, improving to
    about 2.5x in 2019; and

-- Increasing positive FOCF due to a gradual reduction in
    overall capex compared with recent years.

S&P said, "The negative outlook reflects that we could lower the
rating on Titan if we did not see a sustainable improvement in
its EBITDA and free operating cash flow generation in the next 12
months as forecasted in our base case.

"We could lower the rating if Titan's adjusted FFO-to-debt ratio
remained below 30% in the next 12 months. This could occur if
demand in some of Titan's main markets, notably the U.S., were to
falter, or if the group were to invest, make acquisitions, or
increase shareholder distributions above our base case. Pressure
on the ratings could also arise if material foreign-exchange
swings harmed Titan's financial results, or if its liquidity
profile were to deteriorate.

"We could revise the outlook to stable if we observed a sustained
improvement in Titan's operating performance, translating into
achieving an adjusted FFO-to-debt ratio of comfortably above 30%,
which we view as commensurate with the rating."


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MAGYAR TAKAREKBANK: S&P Affirms 'BB/B' ICRs, Outlook Stable
-----------------------------------------------------------
S&P Global Ratings said that it revised its outlook on Hungary-
based Magyar Takarekszovetkezeti Bank ZRt. (Takarekbank) to
stable from positive and affirmed its 'BB/B' long- and short-term
issuer credit ratings on the bank.

S&P said, "The outlook revision follows our review of the Savings
Cooperative Group Hungary's capital and earnings profile. It
reflects our view that the group's capital ratios have decreased
over 2018 due to a marked decline of its equity capital and
higher-than-expected lending to corporate clients, leaving less
room for the group to absorb unexpected losses. We consider that
the lower capitalization is offsetting the positive momentum in
the group's restructuring. The group's risk-adjusted capital
(RAC) ratio has declined more than we previously projected,
reaching 7.1% at mid-year 2018 versus 9.2% in 2017 and 11.3% in
2016.

"The group's total adjusted capital (TAC) -- our key capital
metric under our risk-adjusted capital (RAC) framework and the
numerator of the RAC ratio -- plunged by a material Hungarian
forint (HUF) 32.5 billion between 2016 and 2017, which equates to
a decline of 13% of the group's TAC. The reduction of equity
capital is the result of a buyout of two cooperative credit
institutions in 2017, for which the group used its own funds.

At the same time, the corporate loan book surged by 35% from mid-
year 2017 to mid-year 2018, while the average growth in loans in
Hungary was 12.1% during the same period. This acceleration is
the result of the group's strong credit growth in the small-and-
midsize-enterprise industry, with a focus on investment and
project finance loans in the agriculture and commercial real
estate (CRE) sectors. S&P classifies some of these loans as
higher risk because of the inherent volatility of cash flows
related to the cyclical nature of the CRE sector, leading to
likely higher credit losses, and therefore higher risk charges in
the calculation of S&P Global Ratings' risk-weighted assets for
the group.

The group's Tier 1 capital ratio declined from 26% in 2016 to
16.7% at mid-year 2018, but it remains above the regulatory
minimum requirement of 13.9% at mid-year 2018. S&P does not
regard the reduction in the buffer above the regulatory ratio as
a risk, and expect that group's management will adjust its
strategy in a timely manner to maintain the capital ratio
adequately above the regulatory minimum.

S&P said, "In our base-case scenario, we expect the RAC ratio to
hover around 6% in the next 18-24 months, but we highlight the
sensitivity of this forecast to any potential further share buy-
outs, unexpected material losses, or strong lending growth. We
base our forecast on our assumption of average loan growth of
about 10% until 2020. We expect the group's capital
sustainability ratio and earnings buffer ratio to remain negative
until 2020. These ratios indicate a deficient ability to build up
capital and cover normalized losses through the cycle.

"On a positive note, in our view the group's ongoing
transformation under its five-year strategy will improve the
profitability and efficiency of the member banks in the long run.
We think the strategy will also improve the quality of corporate
governance, which we continue to assess as weaker than that of
peer banks. The complex and decentralized group structure remains
a weakness in comparison to other rated banks. In our view, the
decentralized structure results in a lack of uniform risk
management standards and best practices among group members.
Having said that, we understand from Takarekbank's management
that the five-year strategy aims to improve this by centralizing
and streamlining the group's key functions.

"The group's asset quality continues to improve as we expected,
demonstrated by its ratio of nonperforming loans (loans 90 days
past due and restructured loans) to gross customer loans of 7.9%
at mid-year 2018, following 10.3% at year-end 2017.

"The funding and liquidity profile of the Savings Cooperative
Group Hungary remains unchanged, in our view, because of its
stable and sticky deposit base, funding metrics that are
sustainably and structurally above the peer average, and high
liquidity buffers. At mid-year 2018, the group's stable funding
ratio reached 146%, while its multiple of broad liquid assets to
short-term wholesale funding was 9.6x. Having said that, we note
that the funding and liquidity ratios have declined gradually
since 2015. If this trend continues, and the group's metrics move
closer to the system average, we might remove the one notch of
uplift that we currently incorporate in our ratings for the
group's strong funding and liquidity profile.

"We continue to see Takarekbank as core to the group due to the
bank's crucial role as central institution, and we derive our
ratings on the bank based on group support. We do not assess
Takarekbank's stand-along credit profile.

"The stable outlook on Takarekbank reflects our view that the
bank will remain core to the Savings Cooperative Group Hungary
and that the group's financial profile will remain steady over
the next 12 months. This in particular includes the group's
funding, liquidity, and capital metrics. We expect that the
success of the group's five-year strategy will improve the
profitability and efficiency of the member banks, but that the
benefits are unlikely to materialize over our 12-month outlook
horizon.

"We could take a positive rating action on Takarekbank if we saw
a material positive impact from the new strategy on the group's
operations and performance in the next 12 months. Preconditions
for a positive rating action include a visible improvement in
profitability and asset quality metrics at the group level.

"We could take a negative rating action on Takarekbank if the
group's profitability and cost efficiency remained weaker than
that of peers and management plans proved ineffective. This could
lead to a deterioration of the group's business or risk
positions. We could also take a negative rating action if the
group's capitalization depleted such that our projected RAC ratio
deteriorated below 5%. We would consider a negative rating action
if, contrary to our base-case expectations, we observed a
significant weakening in Takarekbank's links with the Savings
Cooperative Group Hungary, which would trigger a change in our
view of the bank's core subsidiary status."


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


ADIENT PLC: Fails to Report Problems in SS&M Business, Hyder Says
-----------------------------------------------------------------
CHARLES ERIC HYDER, Individually and On Behalf of All Others
Similarly Situated v. ADIENT PLC, BRUCE MCDONALD, and JEFFREY M.
STAFEIL, Case No. 1:18-cv-09630 (S.D.N.Y., October 19, 2018),
alleges that the Defendants made materially false and misleading
statements, and failed to disclose that:

    (i) Adient's core seat structures and mechanisms ("SS&M")
        business faced significant operational problems such that
        the repeatedly touted 200-basis-point margin expansion
        was not "on track"; and

   (ii) as a result, Adient's public statements were materially
        false and misleading at all relevant times.

The truth first began to emerge during a Deutsche Bank Global
Auto Industry Conference held on January 17, 2018, where the
Defendants made several startling disclosures indicating Adient
was not "solidly on track" to achieve the previously-touted 200
basis point margin expansion, the Plaintiff contends.  The
Plaintiff asserts that this news drove the price of Adient shares
down $8.03, or about 9.8%, to close at $74.15 on January 18,
2018.

Adient is organized in Ireland with its principal executive
offices located in Dublin.  The Individual Defendants are or were
directors and officers of the Company.  The Company was formed
when, in late October 2016, Johnson Controls International plc
completed its spinoff of its automotive seating and interiors
business.  The Company designs, engineers, and manufactures
automotive seating for all vehicle classes and all major original
equipment manufacturers ("OEMs") and claims to be the largest
global automotive seating supplier in the world.[BN]

The Plaintiff is represented by:

          Jeremy A. Lieberman, Esq.
          J. Alexander Hood II, Esq.
          Jonathan Lindenfeld, Esq.
          POMERANTZ LLP
          600 Third Avenue, 20th Floor
          New York, NY 10016
          Telephone: (212) 661-1100
          Facsimile: (212) 661-8665
          E-mail: jalieberman@pomlaw.com
                  ahood@pomlaw.com
                  jlindenfeld@pomlaw.com

               - and -

          Patrick V. Dahlstrom, Esq.
          POMERANTZ LLP
          10 South La Salle Street, Suite 3505
          Chicago, IL 60603
          Telephone: (312) 377-1181
          Facsimile: (312) 377-1184
          E-mail: pdahlstrom@pomlaw.com

               - and -

          Peretz Bronstein, Esq.
          BRONSTEIN, GEWIRTZ & GROSSMAN, LLC
          60 East 42nd Street, Suite 4600
          New York, NY 10165
          Telephone: (212) 697-6484
          Facsimile (212) 697-7296


AURELIUS EURO 2008-1: S&P Cuts Ratings on 2 Note Classes to D
-------------------------------------------------------------
S&P Global Ratings lowered to 'D (sf)' (default) its credit
ratings on Aurelius Euro CDO 2008-1's class C and D notes.

The rating actions follow notification from the trustee that the
transaction has been liquidated. S&P said, "We have received the
September 2018 payment date report. We observed that the
liquidation proceeds were insufficient to redeem the class C and
D notes in full."

S&P said, "As our rating on the class C and D notes addresses
ultimate payment of interest and principal, we have lowered to 'D
(sf)' from 'CCC- (sf)' our rating on these classes of notes. All
tranches in this transaction are now rated 'D (sf)'; therefore,
we will withdraw the ratings 30 days after the rating actions."

Aurelius Euro CDO 2008-1 is a cash flow mezzanine structured
finance collateralized debt obligation (CDO) of a portfolio that
consists predominantly of residential mortgage-backed securities
(RMBS) as well as commercial mortgage-backed securities (CMBS),
and, to a lesser extent, CDOs of corporates and CDOs of asset-
backed securities. The transaction closed in May 2008 and is
managed by Omicron Investment Management GmbH.


IRELAND: Bailout Inspectors See "Signs of Overheating"
------------------------------------------------------
Anna Isaac at The Telegraph reports that bailout inspectors have
warned that the Irish economy risks overheating, adding to fears
about how a Brexit-related shock could shake the country's
fragile banking system.

According to The Telegraph, a team of officials from the European
Commission tasked with overseeing the state's ability to repay
loans have reported that "signs of overheating" are building,
amid "significant risks" which are "overshadowing the economic
outlook".

In the aftermath of the crisis, Ireland had to seek a bailout of
EUR85 billion (GBP76 billion) in a joint program from the EU and
global lender of last resort the International Monetary Fund to
fund both its state and banking system, along with other
bilateral loans from Denmark, Sweden and the UK, The Telegraph
discloses.


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


TELECOM ITALIA: S&P Affirms 'BB+/B' ICRs, Outlook Stable
--------------------------------------------------------
S&P Global Ratings said that it had affirmed its 'BB+/B' long-
and short-term issuer credit ratings on Italy-based
telecommunications company Telecom Italia SpA.

At the same time, S&P revised the outlook to stable from
positive.

The affirmation follows Telecom Italia's third-quarter reporting
under difficult competitive, currency, and spectrum cost
circumstances. Across its segments, S&P thinks that Telecom
Italia is well positioned to weather the domestic mobile market
and Brazilian currency challenges through resilient underlying
operations. This could allow TIM a return to deleveraging in
2019, supported by its efficiency program and lower capex leading
to improved cash flows.

However, Iliad's stronger than expected showing and TIM's high
spending in the October 5G spectrum auction has set back S&P's
expectations for deleveraging, making it less likely that TIM
will organically reach our financial ratio thresholds for an
upgrade over the next two years.

Spectrum bids totaled EUR6.55 billion, 260% of the EUR2.5 billion
reserve price after an intense fight for the 3.6 GHz band pushed
the price per MHz POP to EUR0.36, nearly triple the rate for
similar auctions to date in Europe. TIM will pay its EUR2.4
billion share over the next four years. S&P will reflect cash
flows in the period when they occur and adjust the company's debt
to reflect future spectrum spending commitments, as the spectrum
becomes available on a net-present-value basis using a 7%
discount rate.

S&P said, "The TIM board's dismissal of Genish on Nov. 13, 2018,
adds an additional headwind to our outlook. In our opinion, TIM's
track record of execution against a long-term strategic plan has
suffered from management continuity interruptions. To the extent
the management shakeup reflects divisions at the board level over
control, we see increased risk to management continuity and the
continuity of broader strategic priorities like financial and
shareholder policies or asset sales."

Iliad's entrance hit TIM's domestic market performance more
squarely with a full-quarter impact in the third quarter.
Heightened competition led to reduced service revenue (down 2.8%
year-over-year) and customers (human subscribers down 1.7%
quarter-over-quarter, about 400,000) as Iliad racked up 2 million
subscribers in 100 days and all players retrenched. While TIM's
total customer numbers increased, they mask the mix effect of
more low-priced M2M customers and at its discount Kena brand.
That subscriber shift will continue to pressure average revenue
per user (ARPU) and limit revenue gains.

That said, TIM has performed better than its peers, a credit to
its premium position, some stickiness from converged bundles
(albeit penetration is low at about 20%), and a well-executed
launch of Kena last year to protect its more value-conscious
customers. Of Iliad's new subscribers, TIM contributed about 20%,
less than its 31% market share. Reported churn was relatively
stable at 26.6% (annualized), up less than 1% year-over-year and
quarter-over-quarter, compared to Vodafone's churn spiking to
48.2%.

The domestic fixed segment has had stable performance with
broadband, and in particular next generation network (NGN) line
growth leading to ARPU gains that offset a decline in traditional
voice-line customers and Sparkle revenue. Telecom Italia could
face elevated line losses through repricing moves to recover from
the 28-day billing cycle reversal. But, S&P expects an improving
customer mix will partially balance out these factors at slightly
negative revenue growth in 2018 and 2019.

S&P said, "For TIM Brazil, we expect continued strong organic
performance of 5% growth will be more than offset by depreciation
of the Brazilian real. Our currency forecast has weakened, and we
expect rates of R$4.85/euro in 2018 and R$5.28 in 2019, further
weakening contributions from Brazil on consolidation.

"We take a constructive view of Telecom Italia's efficiency plan,
which has held addressable operating expenses flat in the third
quarter of 2018 despite a rampup in commercial and care costs to
cope with increased competition. Capex is also down by over 20%
for the first nine months. We expect that continued solid
execution of the plan should result in additional increases in
EBITDA margins in both Italy and Brazil in 2019, as well as
positive and increasing free cash flow generation. These results
should enable Telecom Italia to resume deleveraging in 2019 and
beyond.

"Our assessment of Telecom Italia's business profile continues to
benefit from its leading fixed-line position, with a broadband
market share in Italy of about 46% as of December 2017 (Agcom)
and the added benefits of providing wholesale access to other
fixed-line carriers. Additionally, Telecom Italia benefits from a
solid position in the Italian mobile market as one of the three
mobile network operators (about 31% customer market share as of
September 2018, according to the company) and in our view from
the unique position of being the only telecom operator in Italy
able to provide convergent fixed and mobile services on its own
network. Telecom Italia's business profile also benefits from
high EBITDA margins in Italy and geographic diversity in the
Brazilian market.

These strengths are partly offset by fierce mobile competition in
Italy, compounded by Iliad's entry and Italy being predominantly
pre-paid, resulting in limited switching costs and high customer
churn rates (averaging 23%-24% annually)."

In fixed, the Italian broadband market is still underpenetrated,
and TIM faces ongoing cannibalization issues between and within
its fixed-line and mobile segments. Also, fiber network overlap
with Open Fibre could lead to pricing competition and gradual
losses of wholesale revenues. Telecom Italia has also experienced
a tough regulatory environment in Italy, widening credit spreads
in line with the sovereign, and the challenging economic and
political environment in Brazil.

S&P said, "The rating is constrained by the relatively high
leverage and track record of limited cash flow generation
compared with peers such as KPN or Telekom Austria, though we
expect improved cash flow will give TIM capacity to resume
deleveraging in 2019.

"The sovereign rating on Italy (BBB/Negative) does not factor
into our credit analysis given the two-notch separation. Were the
sovereign rating or outlook to fall below that on TIM, we would
apply our rating above the sovereign criteria to determine if a
ratings cap would apply.

"The stable outlook reflects our expectation of adjusted leverage
between 3.3x and 3.5x and FFO to debt of 20%-22% in 2018 and
2019. Improvements in that range should come from execution of
the company's efficiencies plan and resulting margin improvement,
investments in upgrading its fixed and mobile networks, and
recurring cash flow generation.

"We could raise the rating if we expect sustainable adjusted
leverage comfortably below 3.3x, an increase in FFO to debt
toward 25%, and free operating cash flow to debt sustainable
above 5%. Along with improved financial performance, we would
like to see progress in resolving disputes at the board level and
with the government to consider an upgrade. For example, a
clarification of strategic priorities by new management with
broad board support, combined with some track record of
execution.

"We could lower the rating if we forecast adjusted leverage
rising sustainably above 3.8x. This could stem from an unexpected
return to unsustainable mobile competition that depresses ARPUs
or causes churn to spike, or from longer-term fixed-line
deterioration under pressure from OpenFiber. If contrary to our
expectations Telecom Italia moves to relinquish control over its
fixed network, we could also consider a downgrade based on a
weaker business profile, unless it's offset by material
deleveraging."


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


GETIN NOBLE: Poland Vows to Provide Support Following Scandal
-------------------------------------------------------------
Adrian Krajewski, Maciej Martewicz and Konrad Krasuski at
Bloomberg News report that Poland's finance minister and central
bank chief pledged to provide liquidity and support for two
lenders at the center of a corruption scandal, helping shore up
battered bank stocks.

"We are ready to guarantee that these banks have and will
maintain liquidity," Bloomberg quotes Governor Adam Glapinski as
saying on Nov. 19.  "Their clients are safe."

He spoke after the country's Financial Stability Committee (KSF)
held an emergency meeting on Nov. 18 and vowed to step in with
"necessary actions to support banking-system stability",
Bloomberg relates.

Poland's nationalist government and its allies in the central
bank are struggling to contain the scandal, which broke last week
when Gazeta Wyborcza newspaper published transcripts of
recordings suggesting that the financial regulator solicited a
bribe from Leszek Czarnecki, the owner of Getin Noble Bank SA and
Idea Bank SA, Bloomberg discloses.

The concern is that the public debate over Getin Noble and Idea
Bank, both of which lost money in the second quarter, would
prompt some customers to pull their deposits and force other
lenders to help bail out its clients under the country's bank
guarantee fund, Bloomberg states.  Both Glapinski and Finance
Minister Teresa Czerwinska said on Nov. 19 that Getin Noble and
Idea Bank were operating normally, according to Bloomberg.

Mr. Glapinski didn't specify what liquidity measures the central
bank could provide, while blaming a "media frenzy" over
Mr. Czarnecki's banks for stoking public concerns, Bloomberg
relays.

Both lenders, which are among the least capitalized among listed
Polish banks, rely on short-term retail deposits for funding,
Bloomberg says.


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


CB MOSKVA: Put on Provisional Administration, License Revoked
-------------------------------------------------------------
The Bank of Russia, by its Order No. OD-2955, dated November 14,
2018, and effective from the same date, revoked the banking
license of Moscow-based credit institution Regional
Joint-stock Commercial Bank Moskva (Registration No. 1661),
further also referred to as the credit institution.  According to
its financial statements, as of November 1, 2018, the credit
institution ranked 431st by assets in the Russian banking system.

The credit institution's operations were on multiple instances
found to be non-compliant with Bank of Russia regulations on
countering the legalization (laundering) of criminally obtained
incomes and the financing of terrorism (AML/CFT) with regard to
the completeness and reliability of information provided to the
authorized body about operations subject to mandatory control.

The second quarter of the year saw a manyfold rise in the volume
of the credit institution-conducted questionable transit
operations, of which roughly half were transactions related to
retail companies' shadow sales of cash receipts to third parties.
The Bank of Russia's interactions with the credit institution
aimed at improving its anti-money laundering processes failed to
result in appropriate corrections to its business model.
Moreover, several facts constituted evidence for the credit
institution's deliberate involvement in the conduct of suspicious
transactions, with its executives and shareholders having no
intention to take effective action towards stopping such
operations.

The Bank of Russia repeatedly (3 times over the last 12 months)
applied supervisory measures against Moskva, including
supervisory action for non-compliance with AML/CFT regulations.

Under these circumstances, the Bank of Russia took the decision
to revoke Regional Joint-stock Commercial Bank Moskva's banking
license.

The Bank of Russia took this measure following the credit
institution's failure to comply with federal banking laws and
Bank of Russia regulations, repeated violations, within a year,
of Bank of Russia regulations issued in accordance with the
Federal Law "On Countering the Legalisation (Laundering) of
Criminally Obtained Incomes and the Financing of Terrorism", and
multiple applications within one year of measures stipulated by
the Federal Law "On the Central Bank of the Russian Federation
(Bank of Russia)".

Following banking license revocation, Moskva's professional
securities market participant license was cancelled.

The Bank of Russia, by its Order No. OD-2956, dated November 14,
2018, appointed a provisional administrator to the credit
institution 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 were suspended.

Regional Joint-stock Commercial Bank Moskva is a member of the
deposit insurance system.  The revocation of a banking licence is
an insured event as stipulated by Federal Law "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.


UM-BANK LLC: Put on Provisional Administration, License Revoked
---------------------------------------------------------------
The Bank of Russia, by its Order No. OD-2953, dated November 14,
2018, revoked the banking license of Moscow-based credit
institution UM-Bank Limited Liability Company, or UM-Bank LLC
(Registration No. 1441) from November 14, 2018.  According to its
financial statements, as of November 1, 2018, the credit
institution ranked 293rd by assets in the Russian banking system.

Funds attracted from households accounted for more than half of
liabilities on the bank's balance sheet; the credit institution
invested them in low-quality assets -- dubious and bad debts
accounted for about 70% of the loan portfolio.  As the credit
institution consistently underestimated credit risk assumed, the
Bank of Russia repeatedly requested that it create additional
loss provisions.  Besides, in order to conceal the bank's real
financial position and to formally comply with prudential
requirements, UM-Bank LLC has performed opaque transactions
during the current year to artificially maintain the equity
capital.

The Bank of Russia repeatedly (5 times over the last 12 months)
applied supervisory measures against UM-Bank LLC, including two
impositions of restrictions on household deposit taking.  At the
same time, the credit institution violated asset sale
restrictions imposed by the Bank of Russia to protect the
interests of its creditors and depositors.

The operations of UM-Bank showed signs of misconduct by the
management who conducted transactions aimed at withdrawal of
liquid assets to the detriment of creditors' and depositors'
interests.  The Bank of Russia will submit information about the
bank's transactions bearing signs of a criminal offence to law
enforcement agencies.

Under these circumstances, the Bank of Russia took the decision
to revoke the banking license of UM-Bank LLC.

The Bank of Russia takes this extreme measure -- revocation of
the banking license -- because of the credit institution's
failure to comply with federal banking laws and Bank of Russia
regulations, due to repeated application within a year of
measures envisaged by the Federal Law "On the Central Bank of the
Russian Federation (Bank of Russia)".

Following the banking license revocation, professional securities
market participant license of UM-BANK LLC was cancelled.

The Bank of Russia, by its Order No. OD-2954, dated November 14,
2018, appointed a provisional administrator to UM-Bank LLC 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 were suspended.

UM-Bank LLC is a member of the deposit insurance system.  The
revocation of a banking license is an insured event as stipulated
by Federal Law "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.


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


KYIV CITY: S&P Affirms 'B-' Long-Term ICR, Outlook Stable
---------------------------------------------------------
On Nov. 16, 2018, S&P Global Ratings affirmed its 'B-' long-term
issuer credit rating on the Ukrainian capital city of Kyiv. The
outlook is stable.

OUTLOOK

S&P said, "The stable outlook reflects our expectations that
Kyiv's strong budgetary performance and ample cash buffers will
enable it to withstand uncertainties coming from Ukraine's very
volatile institutional framework, as well as provide financial
support to its government-related entities (GREs) if needed. The
outlook also factors in our assumption that the city will keep
its tax-supported debt low."

Downside scenario

S&P said, "We might lower the rating if we were to lower our
sovereign ratings on Ukraine; if the city's financial performance
were to substantially weaken, leading to debt accumulation
materially above what we envisage in our base-case scenario; or
if the city's liquidity were to deteriorate."

Upside Scenario

S&P could raise its rating on Kyiv if we observed an improvement
in its debt and liquidity management and a strengthening of the
financial planning. An upgrade would also be contingent on a
similar rating action on Ukraine.

RATIONALE

S&P said, "Our rating on Kyiv reflects our assumption that the
city will continue reporting a strong, but gradually declining,
operating surplus, as well as moderate deficits after capital
accounts. This will allow the city to keep tax-supported debt
below a low 30% of consolidated operating revenues through year-
end 2020. We think that these strengths will counterbalance the
very volatile and centralized Ukrainian institutional framework
for local and regional governments (LRGs), the city's low wealth
levels, and a weak payment culture with a track record of
defaults.

"A volatile framework, low wealth levels, and weak financial
management remain the main constraints on Kyiv's credit quality
We assess Kyiv's economy as weak compared with peers, mostly due
to still relatively low wealth levels by international standards.
At the same time, Kyiv's economy is well diversified and is
Ukraine's most prosperous. Kyiv contributes more than 20% of the
national GDP and enjoys the lowest unemployment rate in Ukraine.
Nevertheless, Kyiv remains highly dependent on state transfers
and the very centralized public finance system, prompting us to
use the national GDP per capita (about US$2,300) in our base-case
calculations. We expect the city's growth will parallel
Ukraine's, at 2.8% on average annually, over 2018-2020."

The city operates under a very volatile institutional setting.
Kyiv's budgetary flexibility and performance are significantly
affected by the central government's decisions regarding key
taxes, transfers, and expenditure responsibilities. The framework
changes frequently, which substantially affects the stability of
both the city's revenue sources and its spending mandates. The
visibility on future systemic changes remains low, therefore
undermining reliable long-term planning at the municipal level.
Most of the taxes are regulated by the central government, which
means that modifiable revenues make up less than 20% of Kyiv's
operating revenues. S&P said, "Moreover, we believe that the
city's ability to adjust modifiable revenues is limited.
Furthermore, Kyiv's substantial investment requirements and high
share of social expenditures continue to restrict its spending
flexibility. We expect a slight increase in capital expenditures
in the next few years, mainly related to infrastructure and
transport."

S&P said, "We consider that the quality of financial management
also constrains the city's creditworthiness. We observe only
emerging long-term planning, as well as weak management of debt
and liquidity and a track record of weak payment culture.
Frequent deviations from legislated budgets, as well as the low
oversight over the city's GREs also put pressure on our
assessment."

Spending pressures will likely gradually weaken budgetary
performance, but the debt burden will not increase meaningfully
S&P s aid, "Although we believe that Kyiv's operating budgetary
performance will generally remain sound over the coming three
years, we expect a gradual weakening of balances owing to
accumulated underfinancing of public services, ongoing minimum
wage increases, and somewhat slower revenue growth. We assume
that the operating budgetary surplus will drop to about 9% of
operating revenues on average in 2018-2020." This compares with
an exceptionally strong 16% posted in 2014-2017, when Kyiv's
revenues benefitted markedly from high inflation-driven tax
revenue growth and additional revenue sources allocated to LRGs
in the context of the local government reform; with expenditure
growth simultaneously lagging somewhat. Central government grants
(mostly earmarked public wage-related transfers), which
contribute up to one-quarter of operating revenues, will continue
to support the city's finances.

Weaker operating balances and existing capital spending pressures
will dent the city's balances after capital accounts. After a few
years of containing investment costs, the city has committed to a
number of large infrastructure projects (such as construction of
bridges and metro lines). S&P believes Kyiv will continue to
fulfill its investment needs in the forecasted period.

S&P said, "As such, we expect the city will post moderate budget
deficits after capital accounts in 2018-2020. At the same time,
we note that service underfunding and capital spending pressures
will remain high, which, together with frequently changing fiscal
rules imposed on LRGs, makes the city's budgetary performance
very volatile and difficult to forecast."

Kyiv recently restructured the remaining US$101.15 million of its
Eurobond (XS0233620235), and it placed a US$115.07 million
Eurobond (due Dec. 15, 2022, XS1743762558) in early September.
S&P views these Eurobonds as market debt and therefore include
them in our debt calculation. Despite the increase of debt stock,
it still expects that Kyiv's tax-supported debt will remain low,
unlikely to exceed 30% of consolidated operating revenues through
2020. The city's direct debt also consists of intergovernmental
debt liabilities to the central government. These mirror the term
of the foreign debt (Eurobonds) that the central government
assumed from the city in 2015. The formal issuer of these bonds
is the Ukrainian Ministry of Finance. Given that the city's
direct debt is denominated in U.S. dollars, S&P notes that Kyiv's
debt burden will be subject to exchange rate volatility.

According to an agreement between the city and the central
government, if the city invests in municipal transport
infrastructure, the government will write off an equal amount
from the city's intergovernmental obligations. Some of Kyiv's
obligations will likely be reduced ahead of schedule after the
city's completion of construction projects. The agreement with
the central government also implies writing off the equal amount
of Kyiv's domestic bonds the city repaid in 2016. The settlement
will take place in 2019-2020. S&P said, "We therefore project the
city will not need to resort to market borrowings to refinance or
repay these intergovernmental obligations. At the same time, we
believe that, should this agreement be derailed or cancelled,
Kyiv could postpone some of its capital expenditures to generate
funds to honor intergovernmental settlements. The other scenario
might imply the central government rolling over these
liabilities. We note that we do not consider it a default when a
local government fails to honor intergovernmental debt."

In addition to direct debt, our assessment of Kyiv's total debt
burden (tax-supported debt) includes liabilities of municipal
GREs, which require budget assistance from the city budget. In
particular S&P factors in all debt of GREs explicitly guaranteed
by Kyiv (Kyivpastrans, Kyivmetro, GVP energy saving company) as
well as the commercial debt of the water utility, since
repayments of most of these liabilities are made directly from
Kyiv's budget. S&P also includes in the tax-supported debt
liabilities coming from the lawsuit against Kyiv's subway company
Kyivmetro, as the city might be required to support the entity.

Following years of budget surpluses, Kyiv has accumulated a
material amount of cash reserves. Over the past year, the average
free cash stood at around Ukrainian hryvnia (UAH) 6.7 billion
(about 11% of total annual spending), providing the city with an
exceptional liquidity buffer should budgetary performance weaken
or a portion of contingent liabilities migrate to Kyiv's balance
sheet. S&P said, "We apply a 50% haircut to the city's cash
reserves, since the city keeps them in the central treasury and
we believe that access to these reserves could be interrupted,
given the central government's track record with regard to
default. Nevertheless, we assume that, Kyiv's liquidity position
remains solid and will comfortably cover the city's annual debt
service over the next 12 months. However, we believe that the
coverage ratio might fall sharply when the city's debt
liabilities are due. At the same time, we believe that the city's
access to external liquidity remains uncertain, owing to the
weaknesses of the Ukrainian capital market and its banking."

The city's completed restructuring of the remaining Eurobonds led
us to positively reassess its contingent liabilities. Some arise
from the accumulated payables at the level of the city's utility
and transportation companies, which still run significant
arrears. These liabilities come from the fact that tariffs for
municipal services are set by the central government below their
cost recovery, with the state not fully compensating the gap. S&P
said, "We expect that Kyiv might provide financial assistance by
increasing subsidies or injecting capital. We also include in the
city's contingent liabilities the UAH3.7 billion in central
government loans received before 2014 to finance mandates set by
the central government. Although the city will have to meet these
obligations, we believe that the payments won't materially impact
the city's liquidity position and the potential support would not
exceed 15% of Kyiv's operating revenues."

In accordance with S&P's relevant policies and procedures, the
Rating Committee was composed of analysts that are qualified to
vote in the committee, with sufficient experience to convey the
appropriate level of knowledge and understanding of the
methodology applicable. At the onset of the committee, the chair
confirmed that the information provided to the Rating Committee
by the primary analyst had been distributed in a timely manner
and was sufficient for Committee members to make an informed
decision.
After the primary analyst gave opening remarks and explained the
recommendation, the Committee discussed key rating factors and
critical issues in accordance with the relevant criteria.
Qualitative and quantitative risk factors were considered and
discussed, looking at track-record and forecasts.

The committee's assessment of the key rating factors is reflected
in the Ratings Score Snapshot above.

The chair ensured every voting member was given the opportunity
to articulate his/her opinion. The chair or designee reviewed the
draft report to ensure consistency with the Committee decision.
The views and the decision of the rating committee are summarized
in the above rationale and outlook. The weighting of all rating
factors is described in the methodology used in this rating
action.

  RATINGS LIST
  Ratings Affirmed

  Kyiv (City of)
   Issuer Credit Rating                   B-/Stable/--


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


ELYSIUM HEALTHCARE 2: S&P Alters Outlook Negative & Affirms B ICR
-----------------------------------------------------------------
S&P Global Ratings said that it revised its outlook on Elysium
Healthcare Holdings 2 Ltd., the parent of U.K.-based private
mental and behavioral health care provider Elysium Healthcare
Ltd. (together, Elysium or the group) to negative from stable. At
the same time, S&P affirmed its 'B' long-term issuer credit
rating on the group.

S&P said, "We also affirmed our 'B' issue rating on the existing
GBP275 million term loan B (TLB) due 2025 and the GBP55 million
revolving credit facility (RCF), issued by financing subsidiary
Elysium Healthcare Holdings 3 Ltd. The recovery rating is '3',
reflecting our expectation of meaningful (50%-70%; rounded
estimate: 55%) recovery in the event of a payment default.

The outlook revision follows Elysium's additional debt-funded
acquisitions and operational disruptions, which have depressed
the group's EBITDA and cash flow generation. S&P said, "These
have led us to adjust downward our expectation for how much the
group is likely to reduce leverage. Elysium has at least five
sites that are transitioning to new treatment-focus areas to
satisfy demand from the Clinical Commissioning Groups (CCGs) and
the National Health Service (NHS) in England and Wales. In
preparation for the new service offering, these sites require
capital expenditure (capex) and are sometimes closed temporarily,
which hits occupancy rates and earnings generation. In addition,
higher agency usage to cover vacancies and support the provision
of bespoke care services, has diluted profitability margins, with
EBITDA margins at approximately 16.0% up to September 2018
(compared with our full-year expectation of 18.0%-20.0%). The
group's debt-financed acquisitions are above our previous
estimates, with the latest bolt-on financed with a drawdown on
the group RCF. Given the associated exceptional costs, we now
estimate that the group will generate marginal or negative free
operating cash flow (FOCF) in fiscal years 2018 and 2019 (ending
Dec. 31). We view negatively the slower leverage reduction as the
company invests in future capacity and we believe the increased
M&A activity adds complexity to the operational challenges
management faces as it attempts to extract efficiency gains. We
view the ability to remain self-funding as key to Elysium's
deleveraging capacity and by extension, diminishing long-term
refinancing risk."

Following the recent refinancing in April 2018, the group has
completed a number of bolt-on acquisitions, which have surpassed
GBP90 million on sites that will offer therapeutic services in
various segments including secured health care, mental health,
and brain injury care. The group now operates across 65 sites,
compared to 22 sites two years ago, reflecting its increased
scale. S&P said, "We expect these latest additions to contribute
over GBP14 million of EBITDA, assuming no operational
disruptions. We have seen the group record higher-than-expected
integration and restructuring costs so far in the 2018 fiscal
year. We expect the group's cash conversion to continue to be
impaired by these costs in the medium-term as new sites are added
to the portfolio. We expect extraordinary capex in greenfield
sites, as well as refurbishment and development costs, to further
limit FOCF in the next 12-24 months. We understand that these
sites will take about 12-36 months to ramp up, however, and so
leverage reduction will be delayed in the near term until optimal
occupancy levels are achieved. Given the group's expansionary
operating strategy, we see rising pressure on its ability to
reduce debt levels without a meaningful improvement in
profitability."

S&P said, "Our business risk assessment reflects our view that
Elysium enjoys a strong market position in the independent
segment of the U.K. behavioral health care services sector as it
provides a wide range of services with high standards and
conveniently located facilities. Some of the group's larger
competitors include Acadia Healthcare, Cygnet Health Care (a part
of Universal Health Services), and Voyage Care. However, in our
view, the relative breadth of Elysium's services should help to
strengthen its relationships with the NHS, CCGs, and local
authorities." Most players in the independent behavioral health
care market tend to focus on a specific health care segment,
which puts Elysium in a strong position when engaging with
stakeholders and bidding for new contracts.

The reduced availability of beds in the NHS, ongoing budget
pressures, and the prevalence of mental health cases in the U.K.
support underlying demand for treatment services in future.
Elysium provides a range of care services to patients with
conditions including schizophrenia, autism, dementia,
personality, eating and mood disorders, Huntington's disease,
acquired brain injury, and learning disabilities. The provision
of care for these patients is not discretionary, and so S&P
foresees continued partnerships with private operators and
outsourcing in order to meet the duty of care mandate in local
areas.

S&P said, "While these recent acquisitions are expected to
solidify Elysium's relationships with its main customers (local
CCGs and the NHS), we note that the market remains fragmented and
we estimate the group has no more than a 5% share. Elysium's
single market exposure to the U.K., as well as its dependence on
public financing, are also risks that the group will need to
manage to preserve group profitability and cash flow generation
due to pressure on pricing tariffs. We view the maintenance of
occupancy rates above 85% across the portfolio, maintaining
superior care quality scores and managing the cost base as vital
in achieving optimal financial performance. Labor accounts for
over 50% of Elysium's overheads and we view it as a key component
in the provision of the group's services. This is because
patients often require constant surveillance and monitoring, as
well as specialized treatment. The group's ability to limit the
use of more expensive agency staff by recruiting and retaining
qualified staff is vital to preserve profitability metrics in our
forecasts. We also view negatively the impact of sale-and-
leaseback transactions on the group's operating leverage.
Although the proceeds have previously been allocated to
incremental debt reduction, the resulting lease payments will
constrain profitability margins and nominal earnings over time if
operating efficiency levels are not maintained.

"We continue to assess Elysium as having a highly leveraged
financial risk profile because we view the owners, BC Partners,
as financial sponsors. This assessment is supported by our
weighted-average forecast credit metrics for the group, including
adjusted debt to EBITDA of 10.5x-11.5x and funds from operations
(FFO) to debt of less than 5% over the next three years. Our
estimate of debt includes the GBP275 million TLB, finance leases
of over GBP100 million, operating lease obligations of over GBP20
million, and shareholder loans. Isolating the effect of the
subordinated shareholder debt, we expect the group to record
leverage of 7.5x-8.5x in 2019 falling to 7.0x-8.0x in 2020.

"We take a favorable view of the cash-preserving nature of the
shareholder loan and other non-common equity instruments, as we
expect the group to achieve FFO to cash interest coverage of
above 2.0x over the next three years (compared with above 2.5x
previously). We expect the group to record fixed-charge coverage
of above 2.0x in our base-case forecast, somewhat diluted by
increased lease obligations. We maintain that the group's ability
to maintain this strong interest coverage metric depends on its
ability to grow top-line revenues and manage its overheads to
compensate for the indexed inflation."

S&P's base case assumes:

-- Revenue growth of about 26% in 2018 and about 19% in 2019,
     reflecting the multiple bolt-on acquisitions completed in
     2018 and the ramp-up of other relatively new facilities and
    transition sites such as Thomford Park and Potter's Bar. New
    green-field sites should contribute incremental revenues as
    they ramp up to full capacity. Modest tariff increases,
    particularly in the secure health segment and the newly
    entered learning disability segment, combined with occupancy
    levels of at least 80% across the portfolio, should support
    solid and stable top-line growth in our projections.

-- Management will continue to control its exposure to agency
    staff costs with effective recruitment drives, while driving
    productivity with the strategic management of its sites. S&P
    said, "We expect that the group's site reconfiguration should
    support earnings stability given the nature of the contracts,
    as patients, on average, stay longer and require bespoke care
    and rehabilitation packages. We estimate reported EBITDA
    margins of 16.5%-18.5% after exceptional costs in 2019 and
    2020."

-- Neutral-to-marginal movement in working capital requirements,
    as the group's main customers are public entities who settle
    their account balances within a calendar month.

-- Capex of 10%-12% of sales in 2018 and 2019, with maintenance
     capex accounting for at least 30% of the total in these
     years. S&P thinks capex may rise in 2019, as management
     pursues strategic investments in site capacity, however, it
     expects this to be funded with the use of internally
     generated cash flows.

-- S&P assumes no further debt-funded acquisitions and that
    there will be no dividend distributions over the next three
    years.

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

-- Revenues of GBP260 million-GBP270 million in 2019, rising to
    GBP285 million-GBP295 million in 2019 from about GBP223
    million in 2018.

-- Adjusted EBITDA margins of 18.0%-20.0% and adjusted EBITDA of
    about GBP47 million-GBP52 million in 2019, rising to GBP52
    million-GBP57 million in 2020, from about GBP38 million in
    2018.

-- Adjusted debt to EBITDA of about 13.8x in 2018, falling to
    10.0x-11.0x in 2019 and 9.0x-10.0x in 2020, reflecting the
    full-year contribution of recent acquisitions. Isolating the
    subordinated shareholder debt, S&P expects leverage of 7.5x-
    8.5x in 2019 falling to 7.0x-8.0x in 2020.

-- Adjusted fixed-charge coverage and FFO to cash interest above
    2.0x in 2018-2020.

The net leverage financial covenant, tested quarterly from
September 2018, includes multiple step-downs from an opening
position of 8.1x to 5.5x as of Dec. 31, 2021. S&P expects
headroom of at least 15% under its base case through 2019 and
2020.

S&P said, "The negative outlook reflects our view that Elysium
will not be able to meaningfully reduce leverage over the next
12-24 months unless it substantially enhances its profitability
and cash conversion. We believe a measured approach in executing
its expansionary plans is necessary in order to preserve credit
quality. The ability to manage the staff cost base, achieve
optimal occupancy levels, and maintain positive credit quality
scores will be the platform for a solid financial performance in
our view. We note, however, that further underperformance, due to
exceptional costs or weaker operating efficiency, such that the
group's cash paying leverage remain high and the group is not
self-funding, would represent tangible heightening of refinancing
risks in our view.

"We could lower the ratings if Elysium's profitability is such
that cash-paying leverage does not fall in the 7.0x-8.0x range in
the next 12-18 months. The group would most likely generate
marginal or negative FOCF under these circumstances with the
group's fixed-charge coverage ratio also approaching 1.5x.
Subsequently, headroom under the financial covenants in the
group's financing facility would most likely tighten to below
15%, leading us to revise down our liquidity assessment. This
would most likely happen if the group were unable to grow
contract volumes, increase occupancy rates, and maintain its
satisfactory care quality scores, which may result a substantial
fall in the group's earnings base. We would most likely revise
our view on the group's business strength under these
circumstances if earnings volatility were higher than we
expected.

"We would consider revising the outlook to stable if Elysium
demonstrated a clear leveraging trend, such that the normalized
cash-paying leverage fell comfortably below 7.0x while
maintaining healthy fixed-charge coverage of at least 2.0x in our
forecasts, given the existing average cost of debt. This would be
most likely if the company significantly outperformed our
forecasts through new contract wins and increased operating
efficiency while managing any pressure on price tariffs. The
group would most likely have a balanced approach to its
expansionary growth plans in this event, such that further
acquisitions and extraordinary capex could be funded from
internally generated cash flows."


FLYBE: Calls in KPMG Amid Financial Woes
----------------------------------------
Oliver Gill at The Telegraph reports that Flybe has called in
accountants from KPMG as the low-cost airline attempts to save
itself from collapse.

Britain's biggest regional airline sounded the alarm on Nov. 13
by putting itself up for sale, The Telegraph relates.  The
announcement came as half-year profits plunged and the company's
auditor, PwC, warned of "significant doubt" over its future, The
Telegraph notes.

KPMG has been appointed to provide Flybe with advice on its cash
flow, The Telegraph discloses.  According to The Telegraph, City
sources said the Monarch Airlines administrator is the
frontrunner to take on a potential insolvency.

Flybe burnt through GBP32.5 million of cash during the first half
of its financial year, The Telegraph states.


HOUSE OF FRASER: Closes Four More Stores After Failed Intu Deal
---------------------------------------------------------------
Ashley Armstrong at The Telegraph reports that Sports Direct
tycoon Mike Ashley has announced the closure of four more House
of Fraser stores, putting hundreds of jobs at risk, after failing
to strike an agreement with property giant Intu.

According to The Telegraph, the department store chain will shut
its doors in Lakeside shopping centre in Essex, the Metrocentre
in Manchester and shops in Norwich and Nottingham in the new
year.

Around 20 House of Fraser shops have been saved from closure
following negotiations with landlords, saving around 3,500 jobs,
but shops in Edinburgh, Hull and Swindon have already been
earmarked for closure, The Telegraph discloses.

"We had multiple meetings with Intu, but we were no further
forward after 14 weeks," The Telegraph quotes Mr. Ashley as
saying.


LERNEN BONDCO: S&P Assigns 'B-' Long-Term ICR, Outlook Stable
-------------------------------------------------------------
S&P Global Ratings assigned its 'B-' long-term issuer credit
rating to Lernen Bondco Plc (Cognita), the new parent company of
Cognita Bondco Parent Ltd. The outlook is stable.

S&P said, "At the same time, we affirmed our 'B-' long-term
issuer credit rating on Cognita Bondco Parent Ltd. The outlook is
stable.

"In addition, we assigned our 'B-' issue rating to the proposed
GBP471 million-equivalent first-lien term loan B due in 2025, to
be issued by Lernen Bidco Ltd., 100% owned financing subsidiary
of Lernen Bondco Plc. The recovery rating on this instrument is
'3', indicating our expectation of meaningful recovery prospects
(50%-70%; rounded estimate: 65%) in the event of payment default.

"Finally, we assigned our 'CCC' issue rating to the proposed
GBP225 million subordinated unsecured notes due in 2026, to be
issued by Lernen Bondco Plc. The recovery rating on these notes
is '6', reflecting our expectation of negligible (0%-10%; rounded
estimate: 0%) recovery in the event of a payment default.

"Upon completion of the proposed refinancing, we will withdraw
our issuer credit rating on Cognita Bondco Parent Ltd. as well as
our issue and recovery ratings on the group's existing GBP435
million senior secured notes and GBP100 million super senior
RCF."

In October 2018, family-owned investment firm Jacobs Holding AG
(Jacobs) acquired 100% of Cognita from private equity firms KKR
and Bregal Capital for GBP2 billion in a leveraged buyout.

S&P said, "Our 'B-' rating primarily reflects our view that
Cognita's S&P Global Ratings-adjusted debt to EBITDA will remain
very high, at close to 9.0x in fiscal 2019 (ending Aug. 31,
2019), from 9.8x in fiscal 2018 post transaction. We believe
Cognita's highly leveraged capital structure and aggressive
expansion and merger and acquisition (M&A) strategies leave the
company with limited financial flexibility to absorb unexpected
events or economic shocks. Cognita's operating performance will
hinge on its ability to successfully fill in the new capacity
from the recently completed large expansion projects, especially
in Asia. In light of the strong early fill rate, and absent any
re-leveraging transactions or M&A, we expect operating leverage
to drive EBITDA growth, enabling Cognita to deleverage and
generate stronger free operating cash flow (FOCF)." This is also
assuming that expansion capital expenditure (capex) will lessen
from 2020.

With revenues of close to GBP430 million in fiscal 2018, Cognita
is a private junior and senior schools ("K-12") operator. It has
about 70 schools and serves around 40,000 pupils located in the
U.K., Spain, Singapore, Hong Kong, Vietnam, Thailand, Chile, and
Brazil. Cognita offers British, American, and Australian
curriculum, as well as the International Baccalaureate, among
others, to both local and expatriate student.

The company has historically pursued an ambitious growth strategy
but has a proven ability to create and fill new additional
capacity. The group recently completed the construction of its
Early Learning Village in Singapore and the Stamford American
School in Hong Kong for a total capex of more than GBP200
million. It also recently spent about GBP60 million on the
acquisitions of the ABS school in Chile and the Woodland school
in Hong Kong. S&P said, "We view these investments in Asia and
Latin America as positive for the company's competitive position.
Diversification away from the mature and highly competitive U.K.
market supports our view of the group's business profile,
especially in light of uncertainty about the effects of Brexit,
even if there has been no major immediate impact on the schools'
earnings. In addition, we understand the Asia and Latin America
regions have supportive growth fundamentals for private education
and benefit from higher margins, which will bolster Cognita's
consolidated EBITDA margin. However, we believe some risks remain
on Cognita's ability to fill the latest expansion projects. The
ramp-up utilization usually takes around three years, yet the
company reported positive fill momentum during the first year
since opening. In addition, because the company will further
invest in greenfield projects as well as M&A to add new capacity,
we believe there are execution risks and that, consequently,
profitability will likely remain lower than other rated peers'.
Furthermore, we anticipate that costs related to exploration,
acquisitions, and integration will continue to weigh on the
group's consolidated EBITDA margin."

Additionally, S&P values Cognita's sound reputation of delivering
high-quality education, as demonstrated by its solid capacity
utilization rate of about 77% and strong retention rate of pupils
of about 85%. The long average student tenure supports high
stability and visibility on revenues and metrics, with about 90%
of enrolments for fiscal 2019 secured as of August 2018.

As part of Jacob's acquisition of Cognita, the new capital
structure will comprises a new GBP471 million-equivalent term
loan B, an undrawn GBP100 million RCF, and GBP225 million of new
senior unsecured notes. We understand the proceeds will be used
to refinance the outstanding GBP553.5 million of Cognita's
financial debt, fund new acquisitions, and pay transaction fees.
In addition to financial debt, we include in our adjusted debt
operating lease obligations of around GBP173 million. S&P said,
"Post transaction, we expect S&P Global Ratings-adjusted debt to
EBITDA to remain very high close to 9.0x in fiscal 2019, then
improving toward 8.0x in 2020. In addition, we expect reported
FOCF to remain materially negative in FY2019, as the group
continues to invest significantly in growth. Nevertheless, we
assume future development capex is discretionary, which should
provide flexibility in the event of a downturn. Moreover, the
company's cash flow generation profile of the company is
supported by favorable working capital dynamics (upfront fee
collection), limited maintenance capex, and our assumption of no
debt-funded M&A or dividend distribution."

S&P said, "The stable outlook reflects our view that Cognita will
sustain at least 10% revenue growth annually, fueled by organic
growth and acquisitions, in the next 12 months. We expect
Cognita's adjusted EBITDA margin will gradually improve toward
24% by 2020 thanks to diversification into higher-margin markets
and operating leverage benefits from recent investments. We
believe that the company's gradual deleveraging will result in
its adjusted debt to EBITDA staying well above 5x. This is once
its new capacity comes on stream, absent any material debt-
financed acquisitions or shareholder returns. In addition, we
expect FOCF to remain materially negative in fiscal 2019 during
the growth phase.

"The stable outlook also incorporates our anticipation that
Cognita maintains adequate liquidity by reducing its
discretionary capex spending if operating performance is weaker
than we currently expect.

"We could lower the rating on Cognita if its operating
performance weakened materially below our projections. This could
result from the group's inability to increase its capacity
utilization or increase fees at least in line with its costs, and
would translate into lower revenues growth than we currently
incorporate in our projections. Operating underperformance could
lead to an unsustainable capital structure, which could lead to a
downgrade. Finally, a negative rating action could arise if capex
overruns lead to negative FOCF for an extended period of time, or
if the group exhibits a more aggressive financial policy, for
example, as a result of another round of large debt-funded
acquisitions, greenfield projects or shareholder returns. In
addition, we could lower the rating if the group's liquidity
weakened.

"We could upgrade Cognita if its performance materially exceeded
our base-case assumptions and it deleveraged to a sustained level
of S&P Global Ratings' adjusted debt-to-EBITDA ratio of well
below 7.5x or lower, while EBITDA interest coverage improved to
2.0x. An upgrade would also hinge on our view that the group
would be able to generate and sustain sizable positive FOCF."


PATISSERIE VALERIE: Parent Firm Names Stephen Francis as New CEO
----------------------------------------------------------------
Will Mathis at Bloomberg News reports that Patisserie Valerie's
parent company named Stephen Francis as chief executive officer,
a month after disclosing accounting irregularities that nearly
resulted in a collapse.

Mr. Francis was previously CEO of pork company Tulip Ltd., a
subsidiary of Danish Crown A/S, Bloomberg discloses.  He succeeds
Paul May, who resigned, at the helm of Patisserie Holdings Plc,
Bloomberg notes.

Mr. May came under scrutiny for his leadership during a period
when the company reported GBP28.8 million (US$36.9 million) in
cash, but actually had a deficit of at least GBP9.8 million,
Bloomberg recounts.

It's not clear how big a problem Mr. Francis faces, Bloomberg
states.  The company secured shareholder approval for a rescue
plan but has not yet disclosed the results of a forensic audit of
its books, Bloomberg relates.


THEATRE HOSPITALS NO.1: S&P Puts CMBS Notes Ratings on Watch Neg.
-----------------------------------------------------------------
S&P Global Ratings placed on CreditWatch negative its credit
ratings in Theatre (Hospitals) No. 1 PLC and Theatre (Hospitals)
No. 2 PLC.

The CreditWatch negative placements reflect the uncertainty
regarding the effect that the proposed restructuring could have
on the transactions' creditworthiness.

The transactions are backed by a portfolio of hospitals, which
are operating as BMI Healthcare hospitals. The hospitals are all
located within the U.K.

S&P said, "We have received a special notice informing us that
the transactions will be restructured. The proposed restructuring
consists of changes to the loan maturities, the signing of a new
hedge agreement, and additional debt being issued without any
collateral being added to the transactions. We believe that these
proposed changes could increase the loan-to-value ratios and
therefore would most likely lead to a deterioration in the
transactions' creditworthiness.

"Furthermore, the tenant did not make a rental payment in the
third quarter of 2018, which caused the issuer to make a
liquidity drawing for both transactions. Based on the information
that we have so far received, there appears to be no excess funds
available to repay these liquidity drawings and we believe it may
be outstanding for an extended period of time. The drawings on
the liquidity facility will accrue interest over time and it is
uncertain how and when they will be repaid. The liquidity
drawings may ultimately reduce recoveries, which would increase
the risk of losses."

RATING RATIONALE

S&P said, "Our ratings in this transaction address timely payment
of interest and repayment of principal no later than the legal
final maturity date.

"Consequently, and in line with our criteria, we have placed on
CreditWatch negative our ratings on both transactions. We expect
to resolve the placements in due course."

Theatre (Hospitals) No. 1 and Theatre (Hospitals) No. 2 are true
sale transactions that both closed in May 2007 and were initially
backed by a pool of 36 loans.

  RATINGS PLACED ON CREDITWATCH NEGATIVE

  Theatre (Hospitals No. 1) PLC
  Class              Rating
              To                   From
  A           BB+ (sf)/CW Neg      BB+ (sf)
  C           B+ (sf)/CW Neg       B+ (sf)
  D           B- (sf)/CW Neg       B- (sf)

  Theatre (Hospitals No. 2) PLC
  Class              Rating
              To                   From
  A           BB+ (sf)/CW Neg      BB+ (sf)
  B           BB (sf)/CW Neg       BB (sf)
  C           B+ (sf)/CW Neg       B+ (sf)
  D           B- (sf)/CW Neg       B- (sf)



                            *********

Monday's edition of the TCR delivers a list of indicative prices
for bond issues that reportedly trade well below par.  Prices are
obtained by TCR editors from a variety of outside sources during
the prior week we think are reliable.  Those sources may not,
however, be complete or accurate.  The Monday Bond Pricing table
is compiled on the Friday prior to publication.  Prices reported
are not intended to reflect actual trades.  Prices for actual
trades are probably different.  Our objective is to share
information, not make markets in publicly traded securities.
Nothing in the TCR constitutes an offer or solicitation to buy or
sell any security of any kind.  It is likely that some entity
affiliated with a TCR editor holds some position in the issuers'
public debt and equity securities about which we report.

Each Tuesday edition of the TCR contains a list of companies with
insolvent balance sheets whose shares trade higher than US$3 per
share in public markets.  At first glance, this list may look
like the definitive compilation of stocks that are ideal to sell
short.  Don't be fooled.  Assets, for example, reported at
historical cost net of depreciation may understate the true value
of a firm's assets.  A company may establish reserves on its
balance sheet for liabilities that may never materialize.  The
prices at which equity securities trade in public market are
determined by more than a balance sheet solvency test.

Each Friday's edition of the TCR includes a review about a book
of interest to troubled company professionals.  All titles are
available at your local bookstore or through Amazon.com.  Go to
http://www.bankrupt.com/booksto order any title today.


                            *********


S U B S C R I P T I O N   I N F O R M A T I O N

Troubled Company Reporter-Europe is a daily newsletter co-
published by Bankruptcy Creditors' Service, Inc., Fairless Hills,
Pennsylvania, USA, and Beard Group, Inc., Washington, D.C., USA.
Marites O. Claro, Rousel Elaine T. Fernandez, Joy A. Agravante,
Julie Anne L. Toledo, Ivy B. Magdadaro, and Peter A. Chapman,
Editors.

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

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