/raid1/www/Hosts/bankrupt/TCREUR_Public/190328.mbx        T R O U B L E D   C O M P A N Y   R E P O R T E R

                          E U R O P E

          Thursday, March 28, 2019, Vol. 20, No. 63

                           Headlines



C R O A T I A

HRVATSKA ELEKTROPRIVREDA: S&P Raises ICR to BB+, Outlook Stable
ULJANIK: Twelve Arrested in Croatia Over HRK1BB Financial Damage


F R A N C E

ELIS SA: Fitch Cuts LT IDR to 'BB', Outlook Stable


K A Z A K H S T A N

GRAIN INSURANCE: S&P Affirms 'B' ICR, Outlook Stable


L U X E M B O U R G

ATENTO LUXCO 1: Moody's Rates Proposed Sr. Secured Notes Ba3


N E T H E R L A N D S

STEINHOFF INT'L: To Place Up to 694MM Shares in KAP to Repay Debt
STORM 2019-I: Moody's Assigns (P)Ba1 Rating to Class E Notes


U N I T E D   K I N G D O M

DEBENHAMS PLC: Sports Direct Mulls GBP61.4MM Takeover Offer
GOAL SOCCER: Uncovers GBP12-Mil. VAT Accounting Errors
LONDON CAPITAL: Money Went to Hands of Small of Group of People
ZARA UK: S&P Alters Outlook to Negative & Affirms 'B' ICR


X X X X X X X X

TURON BANK: S&P Affirms 'B/B' Issuer Credit Rating, Outlook Stable

                           - - - - -


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C R O A T I A
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HRVATSKA ELEKTROPRIVREDA: S&P Raises ICR to BB+, Outlook Stable
---------------------------------------------------------------
S&P Global Ratings raised its long-term issuer credit rating on
Croatian vertically integrated multi-utility Hrvatska
Elektroprivreda (HEP) to 'BB+' from 'BB'. The outlook is stable.

S&P said, "At the same time, we raised our long-term issue rating
on its senior unsecured debt to 'BB+' from 'BB'.

"The upgrade of HEP follows our upgrade of Croatia on March 22,
2019. We believe that Croatia now has an increased ability to
provide timely and sufficient support to HEP in the event of
financial distress, because of its improved credit quality. Our
upgrade of HEP also reflects our view that the company continues to
enjoy a high likelihood of government support and robust
stand-alone performance."

HEP plays a very important role for the Croatian government,
because its transmission and distribution operations are crucial
for the security of the country's energy supply, which in turn is a
fundamental input for Croatia's resilience. In addition, the
Croatian government's 100% ownership of HEP, and the alignment
between the government's energy strategy and that of HEP, reinforce
S&P's view that there is a strong link between both entities.

S&P said, "HEP's monopoly ownership and operation of the
transmission and distribution networks in Croatia, which account
for about 50% of EBITDA generation, are key strengths for the
business, in our opinion. Moreover, we believe that HEP's
low-carbon generation fleet could provide significant competitive
advantages in light of increasing carbon costs and the EU's
low-carbon energy directives."

These strengths are counterbalanced by HEP's limited geographic
diversification, which is mostly constrained to a small market,
with uncertain long-term growth prospects and weaker regulatory
support than in other European countries.

S&P said, "Although HEP has posted FFO to debt consistently between
100%-110% over the past three years, we still believe that the
company's credit metrics are exposed to volatility because of its
dependence on hydroelectric activity, and the risk of procurement
that would arise under poor hydrological conditions in a given
year, as observed in 2011 and 2012. Therefore, we continue to
assess HEP's stand-alone credit profile (SACP) at 'bb'. We observe,
however, that volatility has decreased in recent years.

"The stable outlook on HEP mirrors that on Croatia, and reflects
our assumption that HEP will continue to enjoy a high likelihood of
extraordinary government support.

"It also captures our expectation that HEP will continue posting
sound financial performance, as a result of stable and monopolized
transmission and distribution operations, coupled with its position
as the largest electricity provider in Croatia. We expect that the
company will post FFO to debt above 60% over the next 12 months.

"If we took a positive rating action on Croatia, this would result
in a similar rating action on HEP.

"Rating upside could also stem from a two-notch improvement in
HEP's SACP, but we consider this unlikely. We could revise our
assessment of HEP's SACP by one notch to 'bb+' from 'bb', if we
believe that HEP had sufficient financial policy mechanisms in
place to protect its credit metrics from unfavorable hydrological
conditions, coupled with a proven track record of lower credit
metric volatility, namely FFO to debt and debt to EBITDA. That
said, a one-notch improvement would be insufficient for an upgrade
in the absence of a positive rating action on the sovereign.
A downgrade of Croatia would result in us taking the same action on
HEP.

"We don't see major downward pressure on the company's SACP, or our
rating on HEP, over the next 12-18 months. Assuming no change to
our expectation of a high likelihood of state support, we could
downgrade HEP if its financial performance deteriorates such that
we revised our assessment of its SACP to 'b+', which is far from
our base-case scenario."

ULJANIK: Twelve Arrested in Croatia Over HRK1BB Financial Damage
----------------------------------------------------------------
Igor Ilic at Reuters reports that twelve people were arrested in
Croatia on March 26 on suspicion of causing over HRK1 billion
(US$152.16 million) in financial damage to the country's biggest
shipbuilding group Uljanik and the state budget, the interior
minister said.

Uljanik, which is 25% state-owned and operates two shipyards in the
northern Adriatic cities of Pula and Rijeka, has been battling to
stave off bankruptcy due to liquidity problems that began in 2017,
Reuters relates.  Workers are currently on strike, seeking unpaid
wages, Reuters discloses.

Last week, the government said it was still weighing up whether to
place Uljanik into bankruptcy or to restructure the business at a
cost of around EUR1 billion (US$1.13 billion), equivalent to 2% of
gross domestic product, Reuters recounts.



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F R A N C E
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ELIS SA: Fitch Cuts LT IDR to 'BB', Outlook Stable
--------------------------------------------------
Fitch Ratings has downgraded Elis SA's (Elis) Long-Term Issuer
Default Rating (IDR) and senior unsecured and EMTN programme rating
to 'BB' from 'BB+'. The Rating Outlook remains Stable. The
downgrade reflects the slower than expected deleveraging path post
the Berendsen acquisition completed in September 2017. Although the
group still exhibits good deleveraging capacity based on the high
profitability and FCF generation, this is not enough to mitigate a
leverage level that Fitch expects will not be commensurate with a
'BB+' IDR for at least four years. Many subfactors of the group's
business profile, such as market position and diversification, have
improved with the Berendsen acquisition and are aligned with a
stronger credit profile, supporting the Stable Outlook.

KEY RATING DRIVERS

Higher Than Expected Leverage: Higher cash outflows during the past
18 months, following the acquisition of Berendsen, as well as
pressure on the underlying profitability, has led to a delayed
deleveraging path than originally expected. Fitch's previous rating
case was assuming that Elis would deleverage to below 5x (FFO
adjusted gross leverage) from 2019 (FY18: 7.4x estimated), whereas
Fitch now foresees that such deleveraging has been delayed by more
than two years. Fitch's leverage computation reflects linen costs,
which are expensed rather than capitalised given its relatively
short average economic life. This lowers EBITDA and FFO as captured
in Fitch's adjustments to financial ratios.

Accordingly, the current rating case is different from Fitch's
initial forecast, even if it continues to see deleveraging capacity
over the coming years, with FFO adjusted gross leverage expected to
trend towards 5x by FY22. The company has not made any public
statement regarding a precise deleveraging commitment.

Strong Business Profile: The rating reflects Elis's market
leadership in rental services of flat linen, work clothes, hygiene,
and well-being equipment in most of their markets. The company
shows a geographically diversified profile, and also benefits from
a high visibility of revenues from medium term contracts with a
high renewal rate (95%). Fitch believes this strong business
profile could be a key success factor when negotiating contract
conditions with customers, especially during FY19, when further
labor costs pressures are expected. Furthermore, the integration of
bolt-on acquisitions should lead to improved market position and
pricing power which are key differentiators.

High Profitability Under Pressure: In recent months, Elis achieved
some improvements in profitability, mainly thanks to the impact of
synergies from the Berendsen acquisition as well as some specific
pricing measures taken in the UK. However, the overall underlying
profitability has been under pressure during FY17 and FY18 and
Fitch expects no meaningful improvement in profitability this year
under an even tougher cost environment due to the significant
increase of minimum wages across Europe as well as the growth of
energy prices.

Lower Execution Risk: Elis has almost completed the full
integration of Berendsen, and the execution risk has declined in
this regard. With the acquisition of Berendsen, Elis doubled its
size and strengthened its business profile, which also led to
assess certain risks arising from the integration, especially in
countries with overlap. The company is exploiting synergies in line
with expectations and they expect 90% of the total synergies to be
achieved during FY19. In addition, the recent M&A activity does not
entail major execution risks as these are mainly bolt-on small
acquisitions in underpenetrated regions to strengthen their
position. However, the company has not provided guidance on the
possibility of larger acquisitions.

Strong Free Cash Flow Generation: Fitch believes the Group is in a
better position to considerably improve their FCF generation from
FY19 onwards due to the normalized capex after integrating
Berendsen, and despite cost pressures. Fitch expects that
industrial capex will continue high at 7.3% of sales (excluding
purchase of linen) and then to reduce towards 5.7% - 6% over the
rating horizon. Assuming a stable operating environment and market
conditions, the company should be then in better shape to continue
generating FCF over sales above 6% from FY20 enabling a faster
deleveraging. Future clarity on further M&A appetite and its
funding will therefore be important to ascertain Elis's willingness
to manage its business with a more conservative balance sheet
consistent with a higher rating.

DERIVATION SUMMARY

Elis is one of the leading providers of flat linen globally. The
group benefits from a leading position in most of the European
countries, and has also an important positioning in Brazil and
other fast growing countries in Latam. Even though Elis has higher
leverage than Elior SA (BB/Stable), another French business
services provider, same IDR is justified by Elis's better business
profile with better diversification and market positions in their
respective segments. However, the business profile is still much
weaker than Compass Group plc (A-/Stable) and Sodexo S.A
(Withdrawn, previously BBB+/Negative), which provide contract
catering services globally, and also have stronger financial
profiles.

Fitch views Elior and Elis's financial profiles as comparable, with
higher leverage for Elis but also higher profitability and
significantly better FFO fixed charge coverage. Fitch also views
geographic diversification as other differentiating characteristic
between Elis and Elior. Elior has a larger concentration in France.
Elis has improved considerably after completing the Berendsen
acquisition.

KEY ASSUMPTIONS

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

  - Organic growth of 2.6% in FY19 and then trending towards 2.4%
over the rating horizon.

  - EBITDA margins (after reclassification of linen investments as
operating costs) improving to over 20% by 2022.

  - Capex intensity in FY19 at the same level as FY18, 7.3% and
then 5.7% in FY20 following the end of the Berendsen integration
process.

  - Dividends stable at roughly EUR81 million per annum in line
with FY18 and the current proposal to the Board for FY19.

  - Some annual outflows (EUR70 million) considered for bolt-on
acquisitions.

RATING SENSITIVITIES

Developments That May, Individually or Collectively, Lead to
Positive Rating Action

  - Steady operating performance and full integration synergies
resulting in FFO Margin above 16%.

  - More clarity on the group's financial policy and goals
including specific deleveraging targets and future acquisition
strategy.

  - FFO Adjusted gross leverage (excluding purchase of linen) below
5x or FFO adjusted net leverage below 4.5x on a sustained basis.

Developments That May, Individually or Collectively, Lead to
Negative Rating Action

  - Evidence of increased costs and/or operating underperformance
leading to FFO Margin below 14%.

  - FCF Margin below 5% limiting future deleveraging capacity.

  - FFO Adjusted gross leverage staying above 5.5x (excluding
purchase of linen) or FFO adjusted net leverage above 5.0x by
2021.

LIQUIDITY AND DEBT STRUCTURE

Good Liquidity: At FYE18, Elis had unrestricted cash of EUR187
million. Additionally, the company had access to EUR930 million
undrawn committed bank facilities, EUR30 million of which mature in
FY20, EUR500 million in FY22 and EUR400 million in FY23. The
calendar for debt maturities is comfortable, with only the EUR500
million NEU CP maturing in the short term (EUR413 million drawn as
of 31 December 2018, an instrument which is typically rolled over
on an annual basis, but uncommitted.

SUMMARY OF FINANCIAL ADJUSTMENTS

  - Linen Costs: Given the low average economic life of linen
(between one and five years, three years on average), Fitch does
not capitalise the cost of linen, but treat it as an operating
expense, thus including such costs within EBITDA. In 2018, this
resulted in lowering EBITDA (and FFO) by EUR416 million, but also
reducing capex by the same amount.

  - Restricted Cash: Fitch has considered EUR10 million as
restricted cash, as required for operating expenses to be set aside
at the start of the month.



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

GRAIN INSURANCE: S&P Affirms 'B' ICR, Outlook Stable
----------------------------------------------------
S&P Global Ratings said that it had affirmed its 'B' issuer credit
and insurer financial strength ratings on Grain Insurance. The
outlook is stable. At the same time, S&P affirmed its 'kzBBB-'
long-term Kazakhstan national scale rating.

S&P affirmed the ratings on Grain Insurance because it thinks that
the company will continue playing an important role in Kazakhstan's
agricultural insurance segment, despite potential changes to the
sector's regulation and the competitive landscape. The regulator is
considering a shift to the index crop insurance model, where an
insurance event is linked to the weather index. The current model
hasn't changed for many years, and tariffs remain very low to
compensate losses in case of insurance events. S&P expects that
insurance tariffs and claims payment schemes will likely change if
a new model in crop insurance is widely implemented. S&P also
thinks that more players might enter the market in this case, which
would pressure Grain Insurance's competitive position.

Grain Insurance is currently the dominant player in Kazakhstan's
crop insurance segment, accounting for 73% of gross premiums
written (GPW) in 2018. That said, the company is very small in
absolute terms, with GPW of only Kazakhstani tenge 793.7 million
(US$2.1 million) as of 2018. In addition, the company's premiums in
its core crop insurance line decreased by 30% in 2018 and its
bottom line results were undermined by impaired insurance
receivables and cancelled premiums. We will therefore closely
monitor Grain Insurance's business development in the agricultural
insurance segment and may reconsider our assessment of its
financial strength, revising it downward if its market position or
viability of business model come under greater pressure owing to
regulatory changes or increased competition.

S&P also notes weaknesses in Grain Insurance's risk position
because of the concentration of its investments in
speculative-grade local banks. The average credit quality of the
insurer's investments was in the 'BB' category, while the largest
obligor accounted for 16.9% of the overall investments at the end
of 2018. These weaknesses are somewhat compensated by Grain
Insurance's high capital and liquidity buffers. The insurer's
capital adequacy significantly exceeded our threshold for the 'AAA'
level under our risk-based capital model at the end of 2018. The
regulatory solvency margin was 3.27x higher than its regulatory
minimum as of March 1, 2019.

S&P said, "We expect that Grain Insurance's operating performance
may deteriorate in the next 12 months, with its net combined (loss
and expense) ratio increasing to around 90% from the average of 74%
over the last five years. However, the ratio will likely still
compare well against that of local peers. The average combined
ratio in Kazakhstan's property/casualty insurance sector was about
90% in 2018. Deterioration of Grain Insurance's operating
performance, in our view, may be triggered by the obligatory motor
third-party liability insurance line, which the company started to
write in 2018 and in which it has only a limited track record.

"We also note weaknesses in Grain Insurance's enterprise risk
management compared with peers globally, because the company still
lacks proper controls over accumulation risk and catastrophe
exposures, in our opinion. Although the company has made some
progress in formalizing its risk management process over the past
two years, we believe that accumulation risk, as well as very
limited use of reinsurance protection, may lead to volatile
operating results.

"The stable outlook on Grain Insurance indicates our expectation
that the company's business and financial risk profiles will remain
largely unchanged during the next 12 months. We anticipate that
Grain Insurance will continue playing an important role in
Kazakhstan's agricultural insurance segment and its capital
adequacy will remain supported by a sufficient capital cushion and
zero dividend policy.

“We might take a negative rating action in the next 12 months if
we observed pressure on the company's competitive position in the
local crop insurance segment following the regulatory changes
currently under discussion.

"A positive rating action is remote at this stage. However, we
could consider an upgrade in the next 12 months if we witnessed
notable enhancement of risk-management procedures linked to
catastrophe and accumulation risks, which could include developing
a reinsurance panel. For a positive rating action, we would need to
see Grain Insurance keeping its business position intact if the
regulatory changes are introduced and new players enter the
market."




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L U X E M B O U R G
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ATENTO LUXCO 1: Moody's Rates Proposed Sr. Secured Notes Ba3
------------------------------------------------------------
Moody's Investors Service assigned a Ba3 rating to the proposed
senior secured notes to be issued by Atento Luxco 1 ("Atento")
under the same terms and conditions as the USD 400 million senior
secured notes due 2022, and irrevocably and unconditionally
guaranteed by Atento S.A. and certain subsidiaries. Atento's Ba3
corporate family rating remains unchanged. The outlook is stable.

The proceeds from the proposed issuance will be directed to redeem
outstanding debt, and for general corporate purposes.

The rating of the proposed additional notes assumes that the final
transaction documents will not be materially different from draft
legal documentation reviewed by Moody's to date and assume that
these agreements are legally valid, binding and enforceable.

Ratings assigned:

  - Issuer: Atento Luxco 1

  - Gtd Senior Secured Notes due 2022: Ba3 (global scale)

RATINGS RATIONALE

The proposed issuance is part of Atento's liability management
strategy. Proceeds of the proposed notes will be used to redeem
outstanding debt and for general purposes.

Atento's Ba3 ratings are supported primarily by its size and scale,
among the top five Business Process Outsourcing ("BPO") providers
by revenues, its geographic and product diversity and leading
position in its markets. The ratings also consider its long-term
service contracts, in particular the service agreement between
Atento and its largest client Telefonica that expires in 2021 for
certain countries and in 2023 for Brazil and Spain. The agreement
mitigates the risk of Atento's concentration in Telefonica ("TEF").
The growth prospects of the BPO and customer relationship
management (CRM) industry in Latin America also support the
company's ratings.

Conversely, the services rendered to TEF represent limited
expansion potential. Atento's ratings are also constrained by the
large component of labor in the cost structure of this industry,
which weakens the operating flexibility and potentially generates
high contingency provisions. The industry's fragmented nature and
the necessity to diversify, implement technological innovation and
boost value-added offerings to remain competitive increase the
likelihood of M&A activity. Atento has operated as a company
independent from TEF since 2012, following its acquisition by Bain
Capital Partners, LLC (Bain Capital). The private-equity nature of
Bain Capital's ownership does bring some uncertainty regarding a
future divestment strategy and the consequent impact on the
company's credit metrics.

The proceeds from the proposed issuance will be directed to repay
part of the outstanding debt, including BRL 65.1 million
(equivalent to around $14.7 million) aggregate principal amount
outstanding of existing debentures due 2023 and BRL 92.9 million
(equivalent to around $22.3 million) of outstanding BNDES Credit
Facilities, and for general corporate purposes. With the issuance
Atento will further lengthen it's amortization schedule. Moody's
estimates that following the issuance, gross leverage should
increase by 0.3x to a pro-forma 3.0x, based on Moody's adjusted
2018 figures. Following the proposed liability management 96% of
the company's third party debt will be comprised of the 2022 gtd
senior secured notes. The security package is limited to shares of
the issuer, Atento Luxco 1, and guarantors, including Atento Brasil
S.A.

The stable outlook on Atento's ratings incorporates Moody's
expectation that the company will continue to benefit from the good
prospects of the customer service industry in Latin America while
pursuing its expansion plans toward a more diversified client base
and higher value-added services.

Atento's ratings could be upgraded if the company is able to
diversify its customer base while registering sustained organic
revenue growth, higher operating margins and gradual deleveraging.
Additionally, the company would need to maintain total adjusted
debt/EBITDA below 3.5x and free cash flow/total adjusted debt above
8.0% on a sustained basis for a rating upgrade.

Conversely, the ratings could be downgraded if Atento is unable to
deleverage its balance sheet or if company's profitability
deteriorates considerably. The ratings would suffer downward
pressure if Atento's total adjusted debt to EBITDA increases above
4.0x on a sustained basis and if company's free cash flow to total
adjusted debt remains negative for an extended period of time.
Downward pressure could also arise from high dividend payouts that
result in liquidity shortfalls.

The principal methodology used in this rating was Business and
Consumer Service Industry published in October 2016.

Headquartered in Luxembourg, Atento Luxco 1 (Atento) was created
after the acquisition of Atento Inversiones Y Teleservicios,
S.A.U.' CRM business by Bain Capital on December 12, 2012. Atento
is the holding company of the Atento group; through its direct and
indirect subsidiaries, it operates in Latin America, North America
and EMEA, offering customer care, telesales and other back-office
outsourced services to mainly telecom companies and financial
institutions. Atento is ultimately owned by Atento S.A., a publicly
listed company, since October 2014. The company is the largest
provider of CRM and BPO services in Latin America, and ranks among
the top providers globally, with net revenue of $1.9 billion for
the 12 months ended September 2018 and more than 151,000 employees.



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N E T H E R L A N D S
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STEINHOFF INT'L: To Place Up to 694MM Shares in KAP to Repay Debt
-----------------------------------------------------------------
Tanisha Heiberg at Reuters reports that troubled South African
retailer Steinhoff said on March 26 it would place up to 694
million shares in KAP Industrial via an accelerated bookbuilding to
raise cash to repay debt and shore up its finances.

According to Reuters, the placement, which will be offered to
institutional investors only, will result in Steinhoff, which has a
26% stake in KAP, no longer holding an interest in the diversified
industrial group.

Steinhoff in December 2017 admitted accounting irregularities,
wiping about 85% off its market value and throwing it into a
liquidity crisis, Reuters recounts.

Steinhoff intends applying the proceeds from the sale of the
placing shares to meeting its various obligations, including (but
not limited to) those arising from its announced debt restructuring
process, and to ensuring its business platforms are appropriately
funded," Reuters quotes the firm as saying in a statement.

The company sold down its stake in KAP in March 2018 after placing
450 million shares, or a 17% stake, also via an accelerated
bookbuild in a bid to plug a liquidity gap, Reuters relates.

The firm, as cited by Reuters, said the book will open with
immediate effect and is expected to close as soon as possible.


STORM 2019-I: Moody's Assigns (P)Ba1 Rating to Class E Notes
------------------------------------------------------------
Moody's Investors Service has assigned provisional ratings to Notes
to be issued by STORM 2019-I B.V.:

EUR [*] Senior Class A Mortgage-Backed Notes due 2066, Assigned
(P)Aaa (sf)

EUR [*] Mezzanine Class B Mortgage-Backed Notes due 2066, Assigned
(P)Aa1 (sf)

EUR [*] Mezzanine Class C Mortgage-Backed Notes due 2066, Assigned
(P)Aa3 (sf)

EUR [*] Junior Class D Mortgage-Backed Notes due 2066, Assigned
(P)A2 (sf)

EUR [*] Subordinated Class E Notes due 2066, Assigned (P)Ba1 (sf)

STORM 2019-I B.V. is a five years revolving securitisation of Dutch
prime residential mortgage loans. Obvion N.V. (not rated) is the
originator and servicer of the portfolio. At the provisional pool
cut-off date, the portfolio consists of loans extended to [5,616]
borrowers with a total principal balance of EUR[1.10] billion (net
of savings policies).

RATINGS RATIONALE

The provisional ratings on the Notes take into account, among other
factors: (i) the performance of the previous transactions launched
by Obvion N.V.; (ii) the credit quality of the underlying mortgage
loan pool; (iii) the replenishment criteria ; and (iv) the initial
credit enhancement provided by subordination and the reserve fund.

The expected portfolio loss of [0.70]% and the MILAN Credit
Enhancement (MILAN CE) of [7.80]% serve as input parameters for
Moody's cash flow model, which is based on a probabilistic
lognormal distribution.

The key drivers for the portfolio's expected loss of [0.70]%, which
is in line with preceding STORM transactions and with other prime
Dutch RMBS transactions, are (i) the availability of the
NHG-guarantee for [5.42]% of the loan parts in the pool, which can
reduce during the replenishment period to [3.00]%; (ii) the
performance of the seller's precedent transactions; (iii)
benchmarking with comparable transactions in the Dutch RMBS market;
and (iv) the current economic conditions in the Netherlands in
combination with historic recovery data of foreclosures received
from the seller.

MILAN CE for this pool is [7.80]%, which is higher than most
preceding STORM revolving transactions, because of (i) low
percentage of the NHG-guaranteed loans ([5.42]% of the loan parts
in the pool), which can reduce during the replenishment period to
[3.00]%; (ii) the replenishment period of five years during which
there is a risk of deterioration in pool quality through the
addition of new loans; (iii) the Moody's calculated weighted
average current loan-to-foreclosure-value (LTFV) of [81.29]%, which
is slightly lower than LTFVs observed in other Dutch RMBS
transactions; (iv) the proportion of interest-only loan parts
([59.24]%); and (v) the weighted average seasoning of [3.64] years.
Moody's notes that the unadjusted weighted average current LTFV is
[80.51]%. The difference is due to Moody's treatment of the
property values that use valuations provided for tax purposes (the
so-called WOZ valuation). The WA seasoning based on the oldest
origination dates in Obvion's system is [7.12] years.

The risk of a deteriorating pool quality through the addition of
loans is partly mitigated by the replenishment criteria which
includes, amongst others, that the weighted average CLTMV of all
the mortgage loans, including those to be purchased by the issuer,
does not exceed [83.00]% and the minimum weighted average seasoning
is at least [40] months. Further, no new loans can be added to the
pool if there is a PDL outstanding, if loans more than 3 months in
arrears exceeds [1.5]% or the cumulative loss exceeds [0.40]%.

The transaction benefits from a non-amortising reserve fund, funded
at [1.01]% of the total Class A to D Notes' outstanding amount at
closing, building up to [1.30]% by trapping available excess
spread. The initial total credit enhancement for the Aaa (sf)
provisionally rated Notes is approximately [6.99]%, [5.99]% through
Note subordination and the reserve fund amounting to [1.01]%.

The transaction also benefits from an excess margin of [50] bps
provided through the swap agreement. The swap counterparty is
Obvion N.V. and the back-up swap counterparty is Rabobank (Aa3/P-1
& Aa2(cr)/P-1(cr)). Rabobank is obliged to assume the obligations
of Obvion N.V. under the swap agreement in case of Obvion N.V.'s
default. The transaction also benefits from an amortising cash
advance facility of [2.0]% of the outstanding principal amount of
the Notes (including the Class E Notes) with a floor of [1.45]% of
the outstanding principal amount of the Notes (including the Class
E Notes) as of closing.

Principal Methodology

The principal methodology used in these ratings was "Moody's
Approach to Rating RMBS Using the MILAN Framework" published in
March 2019.

The analysis undertaken by Moody's at the initial assignment of
ratings for RMBS securities may focus on aspects that become less
relevant or typically remain unchanged during the surveillance
stage.

FACTORS THAT WOULD LEAD AN UPGRADE OR DOWNGRADE OF THE RATINGS:

Factors that may lead to a downgrade of the ratings include
significantly higher losses compared with Moody's expectations at
close, due to either a change in economic conditions from its
central scenario forecast or idiosyncratic performance factors.

For instance, should economic conditions be worse than forecasted,
the higher defaults and loss severities resulting from a greater
unemployment, worsening household affordability and a weaker
housing market could result in a downgrade of the ratings. Downward
pressure on the ratings could also stem from: (i) deterioration in
the Notes' available credit enhancement; or (ii) counterparty risk,
based on a weakening of a counterparty's credit profile,
particularly Obvion N.V. and Rabobank, which perform numerous roles
in the transaction.

Conversely, the ratings could be upgraded: (i) if economic
conditions are better than forecasted and the portfolio performs
significantly above expectations; or (ii) upon deleveraging of the
capital structure.



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

DEBENHAMS PLC: Sports Direct Mulls GBP61.4MM Takeover Offer
-----------------------------------------------------------
Ravender Sembhy at The Scotsman reports that Mike Ashley's Sports
Direct is considering tabling an offer for Debenhams which would
value it at GBP61.4 million as the tycoon continues his pursuit of
the struggling department store chain.

According to The Scotsman, the "possible firm offer" would be for
the 70% of Debenhams shares that Ashley does not already own.

He would pay 5p per share, or GBP43 million, in his latest attempt
to seize control of the retailer, The Scotsman discloses.

Debenhams has so far resisted overtures by the billionaire,
favouring its own GBP200 million refinancing plan with its lenders
which would wipe out existing shareholders such as Mr. Ashley, The
Scotsman notes.

As part of the condition of the Sports Direct proposed offer, Mr.
Ashley, who owns just under 30% of Debenhams, would be immediately
installed as chief executive of the high street firm, The Scotsman
states.



GOAL SOCCER: Uncovers GBP12-Mil. VAT Accounting Errors
------------------------------------------------------
Scott Reid at The Scotsman reports that Goals Soccer Centres, the
Scottish five-a-side football operator, saw its troubles mount on
March 27 after admitting it had uncovered "substantial" VAT
accounting errors estimated so far at some GBP12 million.

The East Kilbride-based company, which operates 50 five-a-side
sites in the UK and US, has requested trading of its shares are
suspended on London's junior Alternative Investment Market, The
Scotsman relates.

According to The Scotsman, Goals said its board had concluded that
the VAT misdeclaration issues date back several years, although the
final value of the error is still being established.

The group, which flagged the accounting issues earlier this month,
as cited by The Scotsman, said the accounting troubles may lead to
a "material change in its overall financial position".

It added that it plans to enter into discussions with HMRC
immediately and remains in talks with its lenders to agree new
financing facilities, The Scotsman notes.

The group, in which Mike Ashley's Sports Direct business empire
owns a significant stake, noted that while the "accounting
adjustments" were of a non-cash nature, it means Goals is in breach
of one of its banking covenants with Bank of Scotland, The Scotsman
states.

KPMG was the group's auditor until June 2018, when the firm was
replaced with BDO, The Scotsman discloses.


LONDON CAPITAL: Money Went to Hands of Small of Group of People
---------------------------------------------------------------
Ravender Sembhy at Press Association reports that money invested
into collapsed London Capital & Finance (LCF) ended up in the hands
of a small group of people connected to the business, including its
chief executive, according to administrators to the stricken
group.

LCF went into administration at the end of January after netting
GBP236 million by advertising tax-free individual savings accounts
(Isas), Press Association recounts.

However, it was in fact a high-risk bond scheme with an interest
rate of 8% and left more than 11,000 mainly elderly investors
facing hefty losses, Press Association notes.

According to Press Association, Smith & Williamson, which is
carrying out a corporate post-mortem examination on the defunct
group, said on March 26: "There are a number of highly suspicious
transactions involving a small group of connected people which have
led to large sums of the bondholders' money ending up in their
personal possession or control.

"We are pressing these people to return those funds to us for the
benefit of the bondholders and, failing this, we will pursue those
individuals, as appropriate, for recovery of those sums."

The people named in the administrator's report include LCF chief
executive Andy Thomson, as well as Simon Hume-Kendall, Elten Barker
and trusts relating to Spencer Golding, Press Association states.

The administrators have approached all four, asking them to pay
what they received into escrow, to be distributed to LCF
bondholders, Press Association relates.

The money will be returned in the event that bondholders receive
full repayment from the assets of LCF, Press Association says.

Mr. Hume-Kendall and Mr. Thomson have agreed to this, but Smith &
Williamson is still waiting to hear from the other two, according
to Press Association.


ZARA UK: S&P Alters Outlook to Negative & Affirms 'B' ICR
---------------------------------------------------------
S&P Global Ratings revised its outlook on Zara UK to negative from
stable, and affirmed its 'B' long-term issuer credit rating. S&P
also affirmed the 'B' issue rating on the EUR280 million senior
secured term loan and EUR30 million revolving credit facility
(RCF).

The negative outlook primarily reflects Zara UK's
lower-than-expected operating performance compared to budget
following business disruptions in 2018.

Adverse growing conditions in Kenya, including heavy rainfall, low
night temperatures, and lower sun exposure, combined with a very
hot summer in the U.K. and the rest of Europe, resulted in lower
farm yields for flowers and vegetables for Flamingo and lower
demand for flowers. Sales and EBITDA from the plant business, which
was part of the Butters acquisition in September 2017, were lower
than expected due to some customer changes post-acquisition, and a
longer time to integrate the business than anticipated.

These factors resulted in revenues falling to about GBP435
million-GBP440 million for full-year 2018, a 6% shortfall compared
to budget and in line with comparable sales the year before. S&P
notes positively that Flamingo managed to meet customers' orders
thanks to its relationships with third-party out-growers and by
sourcing roses from The Netherlands auction. Additionally,
synergies around procurement and farming practices with Afriflora
compensated the shortfall in profitability, which came from lower
farm yields and subsequent reduced availability of more-profitable
self-grown flowers and vegetables. This resulted in EBITDA margin
of about 6.5%-7.0%, which represents an improvement of about 50
basis points (bps) year-on-year and is in line with the budget.

Over the same period, political tensions in Ethiopia resulted in a
national strike and labor shortage for Afriflora. Ethiopia's
significantly colder night temperatures saw a 6.7% shortfall in
flowers available compared to the previous year. Afriflora was
therefore unable to realize high margin spot price orders from the
market around peak sale times such as Valentine's Day,
International Women's Day, and Mother's Day. Its revenues of GBP93
million-GBP98 million for full-year 2018 represented a 24%
shortfall compared to budget and were about 6% below 2017. Its
inability to upsell excess volumes at premium prices, the increased
use of high-end biological pesticides to meet customer demand, and
increased salaries following the strike-break have also undermined
profitability. The full-year 2018 EBITDA margin was 25%-28%--an
about 50 basis point loss year-on-year. Positively, S&P recognizes
that Afriflora managed to supply all contracted orders and in doing
so preserved its relationships with its major European customers,
who have renewed their orders for 2019. The political situation in
Ethiopia has now improved with no major business disruptions in
second-half 2018.

The above factors resulted in revenue generation of about GBP530
million-GBP535 million for the combined group: Flamingo and
Afriflora together. This represents a shortfall of about 10%
compared to the budget and is about 1.6% below comparable sales in
2017. The combined EBITDA margin was about 10.0%-10.5%, which is
about 50 bps lower than 2017 and below budget, which was more than
11%.

New VAT procedures in Kenya and a temporary stock build-up in
Ethiopia have reduced the combined group's working capital
absorption and ultimately its FOCF generation. In 2018, the Kenyan
Revenue Authority introduced new procedures and regulations that
led to a longer delay in receiving input VAT on export products.
This led to an unanticipated GBP5 million absorption in Flamingo's
working capital. Afriflora's farm expansions in Ethiopia in
2016-2017 led to a temporary stock increase in 2018. This resulted
in EUR4.5 million working capital outflow for Afriflora. Management
does not anticipate a similar level of working capital absorption
in the coming years because Afriflora is currently not undertaking
any further capacity expansion. Management also expects that the
VAT reclaim process in Kenya should have returned to normal
timescales for refunds from mid-2019 onward.

The negative outlook reflects the risk that adverse weather and
political conditions may continue in 2019 and result in greater
volatility than our base case currently anticipates. S&P believes
that reduced product availability could hamper profitability and
result in weaker funds from operations (FFO) cash interest coverage
compared to its base case. There is also a risk of lower FOCF
generation compared to S&P forecasts in the next 12 months,
possibly caused by greater working capital absorption related to,
for example, prolonged delays in VAT payments in Kenya.

S&P said, "We could lower the rating if the group generates
negative FOCF over the next 12 months or if its FFO cash interest
cover ratio approaches 2x on a sustained basis. This would most
likely stem from prolonged adverse weather affecting revenues and
margins, combined with continued delays in VAT payments that
reduced working capital and cash flow generation. Moreover, we
could lower the rating if Zara UK's liquidity comes under pressure
say from accelerated capital expenditure (capex), as well as a
reduction in cash available and headroom under the maintenance
covenant in the loan documentation (set at 5.95x).

"We could revise the outlook to stable if the group successfully
improves its margin and FOCF increases in the next 12 months. We
would also expect Zara UK's FFO cash interest coverage to remain
comfortably above 2x. This would most likely result from improved
farm yields combined with the sale of additional volumes at a
premium price. We could raise the rating if the group showed a
track record of recurring and significant organic expansion and
sustained profitability improvements, leading to much stronger FOCF
generation."



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

TURON BANK: S&P Affirms 'B/B' Issuer Credit Rating, Outlook Stable
------------------------------------------------------------------
S&P Global Ratings said it has affirmed its 'B/B' long- and
short-term issuer credit ratings on Uzbekistan-based Turon Bank.
The outlook is stable.

S&P said, "The affirmation reflects our view that Turon Bank's
solid capital buffer will be sufficient to meet it's growth targets
and to maintain adequate capitalization. We further believe that
although the bank's lending growth will remain high, it will
gradually slow in 2019-2020 to closer to the systemwide average."

In 2018, Turon Bank's loan portfolio increased by 142% compared
with a systemwide average of 51%. Implementation of government-led
infrastructure projects and new lending to the agriculture and food
processing sectors were key factors behind this significant growth.
In particular, last year the bank started financing a large-scale
infrastructure project to upgrade Uzbekistan's hydropower capacity.
The government chose Turon Bank as the project's key financing bank
in 2017, and has provided it with a substantial capital support
totaling Uzbekistani sum (UZS) 715 billion ($88 million) over the
past two years. S&P said, "We expect Turon Bank will provide about
UZS1,100 billion ($130 million) of new financing in 2019-2020 to
the hydropower sector. We also expect that the bank will continue
to actively expand its lending business by increasing its number of
small and mid-size corporate clients in the agriculture sector. We
expect that the bank will provide about USZ400 billion-USZ450
billion (about $53 million) of new lending to the projects in the
agriculture sector in the next two years by unlocking development
funds from international financial institutions (IFIs)."

S&P said, "In our view, the bank's RAC ratio will deteriorate to
8.3-8.5% by year-end 2020 from 12.5% at year-end 2018. This mainly
reflects expected high lending growth, averaging 45% in 2019-2020,
and the bank's modest profitability. We note that all projects in
the hydropower and agriculture sectors have a very low net interest
margin, which will drag on the bank's earnings capacity. We do not
incorporate potential government support in our RAC forecast, and
instead assume a 50% dividend payout ratio. However, the payout
ratio could be be lower, depending on the government's decision.

"We note that, over the past two years, Turon Bank has maintained
good asset quality and the inflow of new problem assets has been
low, despite rapid lending growth. In 2018, the bank's cost-of-risk
was close to 1.0%, while its absolute amount of nonperforming
assets (NPAs) reduced by 40%, representing about 0.6% of the loan
book. We note that although loans provided to hydropower projects
are denominated in foreign currency, the government guarantees the
debt, mitigating credit risks for the bank. However, we think that
very high lending growth in agriculture will potentially result in
higher credit losses and increase of problem loan volume in the
mid-term, taking into account that most of the loans are
denominated in U.S. dollars. We incorporate this risk in our
assessment of the bank's risk position, which constrains the
rating.

"We think that the bank's funding profile and funding and liquidity
metrics are close to the system average. The bank's funding
structure is rapidly changing, with an increasing share of funds
coming from IFIs. The share of these resources in the bank's
funding mix increased to 40% at year-end 2018 versus 20% a year
ago, with the bank providing most of its lending via these funds.
We tend to view these funds as stable because of their long-term
project nature.

"We think that the bank adequately manages its liquidity. The
bank's net broad liquid assets represents about 51% of its
short-term customer deposits, which seems prudent and close to the
level of peers.

"We view the bank as a government-related entity (GRE), taking into
account its very strong link with the government. However, we think
that there is only a moderately high likelihood of receiving
extraordinary government support. This is because we think that the
bank's role for the government is limited considering the bank's
small market share and small scale of implemented projects compared
with other government-related banks, which could easily undertake
these projects if needed. Therefore, we do not include any uplift
for potential government support in the ratings.

"The stable outlook reflects our expectation that Turon Bank will
likely preserve its adequate capitalization in the next 12-18
months, despite high lending growth resulting from projects in the
hydropower and agricultural sectors.

"While unlikely, we may lower the ratings on Turon Bank if its
stand-alone credit profile significantly deteriorates to 'ccc+' or
lower, raising concerns over the bank's ability to meet its
financial obligations when due. This may happen, for example, if
the bank's liquidity buffer declines materially because of
aggressive asset growth and unexpected depositor outflows.

"We may raise the ratings in the next 12-18 months if the bank
maintains its RAC ratio above 7.0% and preserves good asset
quality, with problem loans and cost of risk not exceeding those of
system average. A positive rating action is also subject to a
slowdown in the bank's aggressive lending growth to closer to the
system average."




                           *********


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 2019.  All rights reserved.  ISSN 1529-2754.

This material is copyrighted and any commercial use, resale or
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