260720.mbx

260720.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 Monday, July 20, 2026, Vol. 27, No. 143 Headlines B E L G I U M MEUSE BIDCO: Moody's Affirms 'B1' CFR, Alters Outlook to Stable F R A N C E MARINE SERRE: Enters Receivership, Seeks Investor G E R M A N Y GOLDEN RAY 1: Moody's Affirms B2 Rating on EUR2.4MM Class E Notes NIDDA HEALTHCARE: EUR200MM Loan Add-on No Impact on Moody's B2 CFR I R E L A N D 1988 ASSET MGMT: S&P Assigns B- (sf) Rating to Class F Notes BLACKTHORN PARK: S&P Assigns Prelim B-(sf) Rating to Class F Notes INVESCO EURO XVII: S&P Assigns Prelim B-(sf) Rating to Cl. F Notes SOUND POINT 17: S&P Assigns B- (sf) Rating to Class F Notes L U X E M B O U R G SIRONA HOLDCO: S&P Lowers ICR to 'SD' on Deferred Interest Payment T U R K E Y TURK HAVA: Fitch Affirms 'BB' Long-Term IDR, Outlook Stable VESTEL ELEKTRONIK: Moody's Cuts CFR & Sr. Unsecured Notes to Caa3 U N I T E D K I N G D O M AEA INTERNATIONAL: Moody's Rates New $700MM Secured Term Loan 'Ba3' BOND UK 3: S&P Assigns 'B' ICR on Coatings Carve-Out From BASF SE DUAL SEAL: Leonard Curtis Appointed as Joint Administrators DYNAMIC FOOD: Springfields Advisory Appointed as Administrator DYNAMIC PIZZA 3: Springfields Advisory Appointed as Administrator DYNAMIC PIZZA LIMITED: Springfields Tapped as Administrator EFFECTIVE HOME: Jeremy Knight Appointed as Joint Administrators HEALTH DISPENSARY: BTG Begbies Appointed as Administrators HORIZON LEGAL: RSM Appointed as Joint Administrators MORGLAS ABS 2026-1: S&P Assigns B- (sf) Rating to Cl. X-Dfrd Notes OCEANIUM LTD: Azets Appointed as Joint Liquidators RAINBOW UK: Moody's Upgrades CFR to B1, Outlook Remains Stable STONEGATE PUB: Fitch Affirms 'CCC+' Long-Term IDR ZEAL GLOBAL: Opus Restructuring Appointed as Joint Administrators - - - - - ============= B E L G I U M ============= MEUSE BIDCO: Moody's Affirms 'B1' CFR, Alters Outlook to Stable --------------------------------------------------------------- Moody's Ratings has affirmed Meuse Bidco SA (Gaming1 or the company)'s B1 corporate family rating and its B1-PD probability of default rating. Concurrently, Moody's affirmed the B1 instrument rating on the EUR400 million backed senior secured term loan due in July 2030 and the EUR100 million backed senior secured revolving credit facility due in January 2029, both issued by Meuse Finco SA. The outlook on both entities was changed to stable from negative. "The rating action reflects Moody's expectations that the company will maintain a solid operating performance over the next 12-18 months, following its strong 2025 results, and that this will lead to stable credit metrics over the same period," says Sarah Nicolini, a Moody's Ratings Vice President – Ratings and the lead analyst for Gaming1. RATINGS RATIONALE Gaming1's B1 CFR is supported by its leading position in the Belgian gaming market, its large exposure to online activities, its very good liquidity and the long-dated maturity of its debt. Its rating is constrained by its relatively small scale, its geographic concentration in Belgium and its exposure to regulatory and fiscal risks inherent to the gaming industry. In 2025, the company overperformed Moody's expectations for profitability. Gaming1's reported EBITDA grew 10% year over year to EUR129 million, supported by strong revenue growth in the online business, which more than compensated for the decline in retail activities, and by disciplined cost management. This translated into a Moody's adjusted EBIT margin of 16.1%, the highest level achieved in recent years. As a result, the company's credit metrics were also materially stronger than Moody's had expected. Moody's adjusted debt/EBITDA reached 3.7x, following the increase in the term loan completed in July 2025, compared with Moody's previous forecast of 4.5x. Moody's adjusted EBIT/interest expense improved materially to 2.6x, compared with Moody's previous forecast of 2.0x, supported by higher profitability despite the increase in debt. Over the next 12-18 months, Moody's expects the company to maintain solid business momentum, with moderate revenue growth supported mainly by the online activities and a broadly stable Moody's adjusted EBIT margin, ranging between 14% and 15%. Although potential regulatory restrictions and/or higher gaming taxes remain key risks, Moody's do not expect any material business disruption over the same period. Moody's expects that the company's Moody's adjusted debt/EBITDA will progressively decline toward 3.6x over the next 12-18 months, while its Moody's adjusted EBIT/interest will remain around 2.6x. This is supported by the repricing that the company completed in February 2026, which reduced the credit spread by 75 bps, to 3.5%. The company also paid EUR150 million of dividends in the first quarter of 2026, which Moody's expects will cause its Moody's adjusted free cash flow (FCF)/ debt to decrease to around -21% in 2026, compared to almost 11% in 2025. Moody's do not forecast any additional shareholder remuneration over the next 12-18 months, therefore, Moody's expects that the company's Moody's adjusted FCF/debt will remain around 10% in 2027 and 2028. Moody's assumes that the company will selectively consider potential bolt-on acquisitions to strengthen its presence in existing geographies, without jeopardizing its credit profile. LIQUIDITY Gaming1's liquidity is very good and supports the rating. The company had EUR86 million of cash as of March 2026 and EUR100 million of a committed, undrawn revolving credit facility (RCF). The RCF features a springing senior secured net leverage covenant, which is tested when more than 40% of the RCF is drawn and required to be maintained below 6.5x. The company can avoid a breach using an equity cure. Moody's expects the company to generate, on average, around EUR50 million of FCF per year over the next 12-18 months, with the sole exclusion of 2026 because of the dividend paid. The company's next debt maturities will be in 2029 and 2030, when the RCF and the term loan will respectively mature. STRUCTURAL CONSIDERATIONS The term loan and RCF are rated B1, in line with the CFR, given they represent most of the company's financial debt. The term loan and RCF benefit from a security package limited to pledges over shares, intercompany receivables and bank accounts. Moody's typically view facilities with this type of security package as providing limited collateral protection, resulting in recovery prospects that are closer to those of unsecured instruments. Both instruments also benefit from upstream guarantees from significant subsidiaries ensuring that a guarantor coverage test of at least 80% of consolidated EBITDA is met. RATIONALE FOR THE STABLE OUTLOOK The stable outlook incorporates Moody's expectations that the company will maintain a solid operating performance over the next 12-18 months, leading to stable credit metrics. The stable outlook does not incorporate any additional shareholder remuneration or any material acquisitions. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS Upward rating pressure is unlikely over the next 12-18 months because Gaming1's relatively small scale, limited business profile and geographic concentration continue to constrain its rating. With continued improvements in scale and diversification, Moody's could upgrade Gaming1's rating over time if its Moody's-adjusted leverage declines well below 3x on a sustained basis, its FCF/debt trends above 20% and it maintains good liquidity. Downward pressure will develop if its operating performance weakens or it is adversely affected by regulatory developments and tax increases. Quantitatively, Moody's could consider downgrading Gaming1's rating if its Moody's-adjusted gross leverage increases above 4.0x on a sustained basis, its FCF/debt decreases to below 10% or its liquidity weakens. PRINCIPAL METHODOLOGY The principal methodology used in these ratings was Gaming published in September 2025. COMPANY PROFILE Gaming1 is a gaming company with online and land-based activities operating casino games, sports betting and poker games primarily in Belgium, but also in the Netherlands, France, Switzerland, Portugal and Spain. In 2025, Gaming1 reported EUR478 million of revenue. The company is owned by a fund managed by CVC Capital Partners (55.17%) since 2022, in a partnership with the founding shareholders (44.83%). =========== F R A N C E =========== MARINE SERRE: Enters Receivership, Seeks Investor ------------------------------------------------- Catie Pusateri of Fashionista reports that French luxury fashion brand Marine Serre has entered receivership after obtaining court protection from the Paris Commercial Tribunal, citing difficult market conditions driven by geopolitical instability and ongoing economic headwinds. The move is designed to give the company breathing room as it restructures its business and secures additional financial backing. The independent label emphasized that the court-supervised proceeding is intended to preserve operations while management works to improve the company's financial stability. The brand continues to operate while exploring options to strengthen its balance sheet and position itself for long-term growth, the report states. Marine Serre also announced that it is actively searching for a strategic investor capable of supporting future expansion. The company believes new financing will enable it to continue developing its collections, broaden its international presence and reinforce its position in the luxury fashion market. Established by French designer Marine Serre, the brand quickly became known for its distinctive aesthetic, environmentally conscious manufacturing and upcycled garments. Like many independent luxury fashion companies, however, it has faced increasing pressure from weaker consumer spending, higher operating costs and an uncertain global economy, the report states. About Marine Serre Marine Serre Sarl is a Paris-based luxury apparel and accessories company established by designer Marine Serre. The fashion house has gained international recognition for combining couture-inspired design with sustainable manufacturing practices, including upcycling and regenerated textiles. The brand markets women's and men's ready-to-wear collections, leather goods, jewelry, footwear and lifestyle products through international wholesale partners and direct-to-consumer channels. The Paris Commercial Tribunal placed Marine Serre into receivership after granting the luxury fashion label's application for judicial protection. The company cited difficult market conditions, including geopolitical instability and economic uncertainty, as factors that weakened its financial position and prompted the filing. Marine Serre said the court-supervised restructuring is intended to maintain business continuity while it searches for fresh investment. The brand is actively pursuing a financial partner to strengthen its balance sheet and finance future expansion. ============= G E R M A N Y ============= GOLDEN RAY 1: Moody's Affirms B2 Rating on EUR2.4MM Class E Notes ----------------------------------------------------------------- Moody's Ratings has upgraded four ratings in Golden Ray S.A., Compartment 1 and Golden Ray S.A., Compartment 2. Moody's affirmed the ratings of the notes that had sufficient credit enhancement to maintain their current ratings. Issuer: Golden Ray S.A., Compartment 1 EUR50M Class A1 Notes, Affirmed Aaa (sf); previously on Nov 12, 2024 Definitive Rating Assigned Aaa (sf) Underlying Rating: Upgraded to Aa2 (sf); previously on Nov 12, 2024 Assigned Aa3 (sf) EUR149.2M Class A2 Notes, Upgraded to Aa2 (sf); previously on Nov 12, 2024 Definitive Rating Assigned Aa3 (sf) EUR12M Class B Notes, Upgraded to A1 (sf); previously on Nov 12, 2024 Definitive Rating Assigned A2 (sf) EUR9.6M Class C Notes, Affirmed Baa3 (sf); previously on Nov 12, 2024 Definitive Rating Assigned Baa3 (sf) EUR4.8M Class D Notes, Affirmed Ba2 (sf); previously on Nov 12, 2024 Definitive Rating Assigned Ba2 (sf) EUR2.4M Class E Notes, Affirmed B2 (sf); previously on Nov 12, 2024 Definitive Rating Assigned B2 (sf) Issuer: Golden Ray S.A., Compartment 2 EUR263.6M Class A Notes, Upgraded to Aa2 (sf); previously on Dec 11, 2025 Definitive Rating Assigned Aa3 (sf) EUR13.6M Class B Notes, Affirmed Aa3 (sf); previously on Dec 11, 2025 Definitive Rating Assigned Aa3 (sf) EUR10.6M Class C Notes, Affirmed A3 (sf); previously on Dec 11, 2025 Definitive Rating Assigned A3 (sf) EUR7.5M Class D Notes, Affirmed Baa3 (sf); previously on Dec 11, 2025 Definitive Rating Assigned Baa3 (sf) EUR5.1M Class E Notes Affirmed Ba3 (sf); previously on Dec 11, 2025 Definitive Rating Assigned Ba3 (sf) EUR6M Class X Notes, Affirmed Baa3 (sf); previously on Dec 11, 2025 Definitive Rating Assigned Baa3 (sf) The notes are backed by consumer loans to finance solar panel purchases extended by ENPAL B.V. (Enpal) to obligors located in Germany. In the case of Compartment 2, the notes are also backed by consumer loans to finance heat pump purchases extended by Enpal Heat GmbH. RATINGS RATIONALE The upgrades of the Class A1 Notes underlying rating and the Class A2 Notes in Golden Ray S.A., Compartment 1, together with the Class A Notes in Golden Ray S.A., Compartment 2 are prompted by an increase in credit enhancement for the affected tranches, together with Moody's reflections of the more established presence of Enpal in the solar panel market in Moody's counterparty risk analysis. The upgrades of Classes A1 underlying rating, A2 and B in Golden Ray S.A., Compartment 1 are also prompted by decreased key collateral assumptions due to better- than- expected collateral performance. More established presence of Enpal in the solar panel market Moody's acknowledges a more established presence of Enpal in the solar panel market, specifically in its role of loan originator and servicer in this relatively new asset class. The extension of the observations of Enpal's historical information for older vintages, together with the actual performance shown by these two transactions since closing are the driver for us to consider that the risk for the senior notes in both transactions is commensurate with Aa2 (sf), compared to the initial rating of Aa3 (sf). In the case of Golden Ray S.A., Compartment 1, the observations comprise 20 months since closing, with a pool factor of 84% and cumulative defaults representing 0.25% of the original balance as of May 2026. Enpal was established in 2017 and has been operating in the German market since 2018. It only began originating a meaningful volume of solar panel loans via its platform since 2023, and the heat pump loan product was launched in 2024. The performance has not been tested through an economic cycle since it effectively reflects only the period post the financial crisis. Given these limitations, Moody's considers that the Class A1 Notes underlying rating and the Class A2 Notes rating in Golden Ray S.A., Compartment 1, together with Class A Notes in Golden Ray S.A., Compartment 2 are constrained at Aa2 (sf). Increase in Available Credit Enhancement Sequential amortization and trapping of excess spread led to the increase in the credit enhancement available in these transactions. In Golden Ray S.A., Compartment 1, the credit enhancement for the Class A1, Class A2 and Class B Notes increased to 21.0%, 21.0% and 15.1% respectively as of May 2026, from 17.6%, 17.6% and 12.6% since closing. In Golden Ray S.A., Compartment 2, the credit enhancement for the Class A Notes increased to 15.5% as of May 2026 from 13.9% since closing due to a spike of prepayment, partially explained by the subsidies received by borrowers shortly after origination. Revision of Key Collateral Assumptions As part of the rating action, Moody's reassessed Moody's expected default rate and recovery rate assumptions for each of the portfolios reflecting the collateral performance to date. The performance of the transactions has remained stable since closing. For Golden Ray S.A., Compartment 1, 90 days plus arrears currently stand at 0.39% of current pool balance showing a slight increasing trend over the past year. Cumulative defaults currently stand at 0.25% of original pool balance up from 0.04% a year earlier. Golden Ray S.A., Compartment 1, Moody's decreased the expected default rate assumption to 5.1% as a percentage of current pool balance from 6.1%. The revised expected default rate assumption corresponds to 4.5% as a percentage of original pool balance (previously 5.5%). Golden Ray S.A., Compartment 2 closed recently, in December 2025. 90 days plus arrears currently stand at 0.31% of current pool balance. Cumulative defaults currently stand at 0.01% of original pool balance, but the default definition is more than six months in arrears. In Golden Ray S.A., Compartment 2, Moody's maintained the expected default rate assumption of 5.5% as a percentage of original pool balance. The revised expected default rate assumption corresponds to 6.1% as a percentage of current pool balance (previously 5.5%). Moody's maintained the assumption for the fixed recovery rate at 20% and 25%, for Golden Ray S.A., Compartment 1 and Golden Ray S.A., Compartment 2, respectively. Moody's reassessed Moody's Portfolio Credit Enhancement ("PCE") assumption for these transactions. PCE reflects the credit enhancement consistent with the highest rating achievable in Germany. Moody's have maintained the PCE assumption at 26% and 27%, for Golden Ray S.A., Compartment 1 and Golden Ray S.A., Compartment 2, respectively. The rating actions took into consideration the notes' exposure to relevant counterparties, such as servicer, guarantor, account banks or swap providers as well as eligible investments for cash proceeds. The principal methodology used in these ratings was "Consumer Loan Securitizations" published in May 2026. Factors that would lead to an upgrade or downgrade of the ratings: Factors or circumstances that could lead to an upgrade of the ratings include (1) performance of the underlying collateral that is better than Moody's expected, (2) an increase in available credit enhancement and (3) improvements in the credit quality of the transaction counterparties. Factors or circumstances that could lead to a downgrade of the ratings include (1) an increase in sovereign risk, (2) performance of the underlying collateral that is worse than Moody's expected, (3) deterioration in the notes' available credit enhancement and (4) deterioration in the credit quality of the transaction counterparties. NIDDA HEALTHCARE: EUR200MM Loan Add-on No Impact on Moody's B2 CFR ------------------------------------------------------------------ Moody's Ratings said that Nidda Healthcare Holding GMBH's (STADA or the company) B2 long term corporate family rating and a B2-PD probability of default rating, along with the B2 ratings of STADA's existing backed senior secured notes and senior secured bank credit facilities, are unaffected by the proposed issuance of EUR200 million add-on to the existing EUR2,833 million senior secured term loan B due 2032. The stable outlook remains unchanged. The EUR200 million proceeds will be used to finance two acquisitions within STADA's consumer health division, and repay EUR40 million of the amount drawn under the company's revolving credit facility (RCF). RATINGS RATIONALE STADA's B2 rating reflects its presence in three business segments with leading market positions in small molecule generics and consumer healthcare in Europe; its good geographical diversification within Europe; its increasing exposure to biosimilars and niche specialty products which have strong organic growth prospects and higher profitability; and favorable market trends (e.g., aging population, growing number of drugs losing exclusivity) which will continue to drive revenue growth. On the other hand, the B2 rating also considers the exposure of the company's generic drugs to price erosion; large working capital requirements, which strain its free cash flow (FCF) generation; and the risk of debt-funded acquisitions which could delay deleveraging. STADA is weakly positioned within its rating category due to its high Moody's-adjusted gross leverage, which reached 7.3x as of March 31, 2026. Moody's expects a decline below 6.5x over the next 12 to 18 months, including the 0.2x pro forma increase related to the new add on, supported by Moody's-adjusted EBITDA growth. Over this period, Moody's expects mid-to-high single digit topline growth, particularly in the company's higher-margin Specialty segment, and continued cost containment measures. STADA has historically pursued debt-funded acquisitions; however, in recent years, the focus has been on bolt-on acquisitions and in-licencing transactions funded with internal cash flow. Under the new ownership by CapVest, Moody's expects STADA to actively pursue M&A and in-licencing transactions. Moody's current rating nevertheless assumes that STADA's financial policy will support further deleveraging until it is more solidly positioned at B2. RATING OUTLOOK The stable outlook reflects Moody's expectations that STADA will show solid operating performance over the next 12-18 months and significantly improve its credit metrics with leverage declining below 6.5x and FCF turning positive. The stable outlook also reflects Moody's expectations that STADA's financial policy will support further deleveraging. LIQUIDITY As of March 31, 2026, and pro forma the add-on, STADA's liquidity is underpinned by a cash balance of EUR280 million and access to a EUR720 million senior secured RCF maturing in 2032, under which EUR35 million is drawn. Moody's projects an improvement in FCF generation which will turn positive in 2026. There are no significant debt maturities before part of STADA's notes mature in 2030. STRUCTURAL CONSIDERATIONS In light of the mixed capital structure, including both bank debt and bonds, Moody's apply a recovery rate of 50% for the corporate family rating, resulting in a B2-PD probability of default rating, aligned with the B2 CFR. STADA's debt structure primarily consists of a senior secured RCF, term loans and notes which all rank pari passu and share the same guarantors and security package primarily consisting of shares from operating subsidiaries accounting for at least 80% of group EBITDA. This results in the company's debt instruments being rated B2, in line with the CFR. As part of the recent STADA acquisition funding by CapVest, a EUR1.4 billion PIK facility resides outside of the restricted group. Moody's do not include this instrument in Moody's credit metrics' calculations for STADA, but Moody's considers that it increases the risk of cash leakage from the restricted group. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS Upward rating pressure is currently limited in light of the high leverage, weak credit metrics, and the presence of the PIK facility outside of the restricted group. Upward pressure could arise over time if STADA continues to deliver solid operating performance, and there is evidence of conservative and predictable financial policies, including visibility into M&A strategy and shareholder distributions. Numerically, this would translate into the company operating under a Moody's-adjusted gross debt/EBITDA below 5.5x, a Moody's-adjusted EBIT/interest expense above 2.25x, and Moody's-adjusted cash flow from operations FCF/debt above 5%, all on a sustained basis. Conversely, downward pressure could develop if STADA's operating performance deteriorates or its financial policy becomes more aggressive, leading to its Moody's-adjusted gross debt/EBITDA remaining above 6.5x, its EBIT/interest expense remaining below 1.5x or its Moody's-adjusted FCF remaining negative on a sustained basis. Downward pressure could also arise if liquidity deteriorates. COMPANY PROFILE STADA is a Germany-based pharmaceutical company specialised in the production and marketing of small-molecule generics, over-the-counter pharmaceutical products and specialties such as biosimilars. In the 12 months that ended March 2026, STADA generated revenue of EUR4.3 billion. The company's product portfolio is reported under three divisions: generics; consumer healthcare; and specialty, which includes biosimilars and partnership licensing deals. Since March 31, 2026, STADA is majority owned by funds managed by CapVest, with Bain, Cinven and management, holding minority positions. ============= I R E L A N D ============= 1988 ASSET MGMT: S&P Assigns B- (sf) Rating to Class F Notes ------------------------------------------------------------ S&P Global Ratings assigned its credit ratings to 1988 Asset MGMT Euro CLO 1 DAC's class A, B, C, D, E, and F notes and A-1 and A-2 loans. At closing, the issuer also issued EUR40.60 million unrated subordinated notes. The reinvestment period will be approximately 4.5 years, while the non call period will be 1.5 years after closing. Under the transaction documents, the rated notes and loans will pay quarterly interest unless there is a frequency switch event. Following this, the notes and loans will switch to semiannual payments. The ratings assigned to the notes and loans reflect S&P's assessment of: -- The diversified collateral pool, which primarily comprises broadly syndicated speculative-grade senior secured term loans and bonds governed by collateral quality tests. -- The credit enhancement provided through the subordination of cash flows and excess spread. -- The collateral manager's experienced team, which can affect the performance of the rated notes and loans through collateral selection, ongoing portfolio management, and trading. -- The transaction's legal structure, which is bankruptcy remote. -- The transaction's counterparty risks, which are in line with S&P's counterparty rating framework. Portfolio benchmarks S&P Global Ratings' weighted-average rating factor 2,552.41 Default rate dispersion 589.74 Weighted-average life (years) 5.25 Obligor diversity measure 146.33 Industry diversity measure 24.59 Regional diversity measure 1.36 Transaction key metrics Total par amount (mil. EUR) 400 Defaulted assets (mil. EUR) 0 Number of performing obligors 182 Portfolio weighted-average rating derived from S&P's CDO evaluator B 'CCC' category rated assets (%) 0.00 Target 'AAA' weighted-average recovery (%) 37.06 Actual weighted-average spread net of floors (%) 3.37 Actual weighted-average coupon (%) 5.81 Rationale S&P said, "Our ratings reflect our assessment of the collateral portfolio's credit quality, which has a weighted-average rating of 'B'. "The portfolio is well diversified at closing, primarily comprising broadly syndicated speculative-grade senior secured term loans and senior secured bonds. Therefore, we have conducted our credit and cash flow analysis by applying our criteria for corporate cash flow CDOs. "In our cash flow analysis, we used the EUR400 million target par amount, the covenanted weighted-average spread of 3.37%, the covenanted weighted-average coupon of 4.50%, and the target weighted-average recovery rate. We applied various cash flow stress scenarios, using four different default patterns, in conjunction with different interest rate stress scenarios for each liability rating category. "The transaction's documented counterparty replacement and remedy mechanisms adequately mitigate its exposure to counterparty risk under our current counterparty criteria. "Under our structured finance sovereign risk criteria, the transaction's exposure to country risk is sufficiently mitigated at the assigned ratings. "The transaction's legal structure and framework is bankruptcy remote, in line with our legal criteria. "Our credit and cash flow analysis indicates that the available credit enhancement for the class B, C, D, and E notes could withstand stresses commensurate with higher ratings than those assigned. However, as the CLO will be in its reinvestment phase starting from the effective date, during which the transaction's credit risk profile could deteriorate, we have capped our ratings assigned to the notes." The class A notes and A-1 and A-2 loans could withstand stresses commensurate with the assigned ratings. The class F notes' current break-even default rate cushion is negative at the assigned rating. S&P said, "Nevertheless, based on the portfolio's actual characteristics and additional overlaying factors, including our long-term corporate default rates and recent economic outlook, we believe this class is able to sustain a steady-state scenario, in accordance with our criteria." The ratings uplift for the class F notes reflects several key factors, including: -- The class F notes' available credit enhancement, which is in the same range as that of other CLOs S&P has rated and that has recently been issued in Europe. -- S&P said, "Our model-generated portfolio default risk, which is at the 'B-' rating level at 24.54% (for a portfolio with a weighted-average life of 5.25 years) versus 16.79% if we were to consider a long-term sustainable default rate of 3.2% for 5.25 years." -- Whether the tranche is vulnerable to nonpayment in the near future. -- If there is a one-in-two chance for this note to default. -- If S&P envisions this tranche to default in the next 12-18 months. -- Following this analysis, S&P considers that the available credit enhancement for the class F notes is commensurate with the assigned 'B- (sf)' rating. S&P said, "Following our analysis of the credit, cash flow, counterparty, operational, and legal risks, we believe that our ratings are commensurate with the available credit enhancement for all rated classes of notes and loans. "In addition to our standard analysis, we have also included the sensitivity of the ratings on the class A to E notes and A-1 and A-2 loans, based on four hypothetical scenarios. "As our ratings analysis makes additional considerations before assigning ratings in the 'CCC' category--and we would assign a 'B-' rating if the criteria for assigning a 'CCC' category rating are not met--we have not included the above scenario analysis results for the class F notes." Environmental, social, and governance S&P said, "We regard the exposure to environmental, social, and governance (ESG) credit factors in the transaction as being broadly in line with our benchmark for the sector. Primarily due to the diversity of the assets within CLOs, the exposure to environmental credit factors is viewed as below average, social credit factors are below average, and governance credit factors are average. For this transaction, the documents prohibit assets from being related to certain activities. Accordingly, since the exclusion of assets from these industries does not result in material differences between the transaction and our ESG benchmark for the sector, no specific adjustments have been made in our rating analysis to account for any ESG-related risks or opportunities." 1988 Asset MGMT Euro CLO 1 DAC is a European cash flow CLO securitization of a revolving pool, comprising euro-denominated senior secured loans and bonds issued mainly by speculative-grade borrowers. 1988 CLO LP manages the transaction. Ratings Amount Credit Class Rating* (mil. EUR) enhancement (%) interest rate§ A AAA (sf) 117.00 38.00 Three/six-month EURIBOR plus 1.29% A-1 AAA (sf) 106.00 38.00 Three/six-month EURIBOR Loan plus 1.29% A-2 AAA (sf) 25.00 38.00 Three/six-month EURIBOR Loan plus 1.29% B AA (sf) 44.00 27.00 Three/six-month EURIBOR plus 1.80% C A (sf) 24.00 21.00 Three/six-month EURIBOR plus 2.25% D BBB- (sf) 28.00 14.00 Three/six-month EURIBOR plus 2.95% E BB- (sf) 18.00 9.50 Three/six-month EURIBOR plus 5.40% F B- (sf) 12.00 6.50 Three/six-month EURIBOR plus 8.33% Sub notes NR 40.60 N/A N/A *The ratings assigned to the class A and B notes and A-1 and A-2 loans address timely interest and ultimate principal payments. S&P's ratings address ultimate interest and principal payments on the rest of the other rated notes. The payment frequency switches to semiannual and the index switches to six-month EURIBOR when a frequency switch event occurs. EURIBOR--Euro Interbank Offered Rate. NR--Not rated. N/A--Not applicable. BLACKTHORN PARK: S&P Assigns Prelim B-(sf) Rating to Class F Notes ------------------------------------------------------------------ S&P Global Ratings assigned its preliminary credit ratings to Blackthorn Park CLO DAC's class A, B, C, D, E, and F notes. At closing, the issuer will also issue EUR39.60 million unrated subordinated notes. The reinvestment period will be approximately 4.6 years, while the non-call period will be 1.5 years after closing. Under the transaction documents, the rated notes will pay quarterly interest unless there is a frequency switch event. Following this, the notes will switch to semiannual payment. The preliminary ratings assigned to the notes reflect S&P's assessment of: -- The diversified collateral pool, which primarily comprises broadly syndicated speculative-grade senior secured term loans and bonds that are governed by collateral quality tests. -- The credit enhancement provided through the subordination of cash flows, excess spread, and overcollateralization. -- The collateral manager's experienced team, which can affect the performance of the rated notes through collateral selection, ongoing portfolio management, and trading. -- The transaction's legal structure, which S&P expects to be bankruptcy remote. -- The transaction's counterparty risks, which S&P expects to be in line with its counterparty rating framework. Portfolio benchmarks S&P Global Ratings' weighted-average rating factor 2,793.77 Default rate dispersion 473.65 Weighted-average life (years) 4.43 Obligor diversity measure 165.33 Industry diversity measure 21.70 Regional diversity measure 1.35 Weighted-average life (years) extended to cover the length of the reinvestment period 4.64 Transaction key metrics Total par amount (mil. EUR) 400 Defaulted assets (mil. EUR) 0 Number of performing obligors 184 Portfolio weighted-average rating derived from S&P's CDO evaluator B 'CCC' category rated assets (%) 0.00 Target 'AAA' weighted-average recovery (%) 37.03 Target weighted-average spread net of floors (%) 3.53 Rating rationale S&P said, "Our preliminary ratings reflect our assessment of the collateral portfolio's credit quality, which has a weighted-average rating of 'B'. "The portfolio is well-diversified, primarily comprising broadly syndicated speculative-grade senior secured term loans and bonds. Therefore, we conducted our credit and cash flow analysis by applying our criteria for corporate cash flow CDOs. "The transaction includes an amortizing reinvestment target par amount, which is a predetermined reduction in the value of the transaction's target par amount unrelated to the principal payments on the notes. This may allow for the principal proceeds to be characterized as interest proceeds when the collateral par exceeds this amount, subject to a limit, and may affect the reinvestment criteria, among others. This feature allows some excess par to be released to equity during benign times, which may lead to a reduction in the amount of losses that the transaction can sustain during an economic downturn. Therefore, in our cash flow analysis, we assumed a starting collateral size of EUR392.50 million (i.e., the EUR400.00 million target par minus the maximum reinvestment target par adjustment amount of EUR7.50 million). "In our cash flow analysis, we modeled the EUR392.50 million reduced par amount, the target weighted-average spread of 3.53%, the covenanted weighted-average coupon of 4.15%, and the target weighted-average recovery rates. We applied various cash flow stress scenarios, using four different default patterns, in conjunction with different interest rate stress scenarios for each liability rating category. "At closing, we expect the transaction's documented counterparty replacement and remedy mechanisms to adequately mitigate its exposure to counterparty risk under our current counterparty criteria. "Under our structured finance sovereign risk criteria, the transaction's exposure to country risk is sufficiently mitigated at the assigned preliminary ratings. "We expect the transaction's legal structure and framework to be bankruptcy remote, in line with our legal criteria. "Our credit and cash flow analysis indicates that the available credit enhancement for the class B to E notes could withstand stresses commensurate with higher ratings than those assigned. However, as the CLO will be in its reinvestment phase starting from the effective date, during which the transaction's credit risk profile could deteriorate, we capped our preliminary ratings on these notes." The class A notes can withstand stresses commensurate with the assigned preliminary ratings. The class F notes' current break-even default rate cushion is negative at the assigned rating. Nevertheless, based on the portfolio's actual characteristics and additional overlaying factors, including S&P's long-term corporate default rates and recent economic outlook, S&P believes this class can sustain a steady-state scenario, in accordance with its criteria. S&P's analysis further reflects several factors, including: -- The class F notes' available credit enhancement, which is in the same range as that of other CLOs S&P has rated and that has recently been issued in Europe. -- S&P's model-generated portfolio default risk, which is at the 'B-' rating level at 25.32% (for a portfolio with a weighted-average life of 4.64 years) versus 14.84% if it was to consider a long-term sustainable default rate of 3.20% for 4.64 years. -- Whether the tranche is vulnerable to nonpayment in the near future. -- If there is a one-in-two chance of this tranche defaulting. -- If S&P envisions this tranche defaulting in the next 12-18 months. -- Following this analysis, S&P considers that the available credit enhancement for the class F notes is commensurate with the assigned preliminary 'B- (sf)' rating. S&P said, "Considering our analysis of the credit, cash flow, counterparty, operational, and legal risks, we believe our preliminary ratings are commensurate with the available credit enhancement for all rated classes of notes. "In addition to our standard analysis, we also included the sensitivity of the ratings on the class A to E notes, based on four hypothetical scenarios. "As our ratings analysis makes additional considerations before assigning ratings in the 'CCC' category, and we would assign a 'B-' rating if the criteria for assigning a 'CCC' category rating are not met, we have not included the above scenario analysis results for the class F notes." Environmental, social, and governance S&P said, "We regard the exposure to environmental, social, and governance (ESG) credit factors in the transaction as being broadly in line with our benchmark for the sector. Primarily due to the diversity of the assets within CLOs, the exposure to environmental credit factors is viewed as below average, social credit factors are below average, and governance credit factors are average. For this transaction, the documents prohibit assets from being related to certain activities. Accordingly, since the exclusion of assets from these industries does not result in material differences between the transaction and our ESG benchmark for the sector, no specific adjustments have been made in our rating analysis to account for any ESG-related risks or opportunities." Blackthorn Park CLO DAC is a European cash flow CLO securitization of a revolving pool, comprising euro-denominated senior secured loans and bonds issued mainly by speculative-grade borrowers. The transaction will be managed by Blackstone CLO Management LLC and Blackstone Ireland Ltd. will act as a sub-collateral manager. Ratings Prelim Prelim amount Credit Class rating* (mil. EUR) enhancement (%) Interest rate§ A AAA (sf) 248.00 38.00 Three/six-month EURIBOR plus 1.24% B AA (sf) 44.00 27.00 Three/six-month EURIBOR plus 1.75% C A (sf) 24.00 21.00 Three/six-month EURIBOR plus 1.95% D BBB- (sf) 28.00 14.00 Three/six-month EURIBOR plus 2.75% E BB- (sf) 18.00 9.50 Three/six-month EURIBOR plus 5.10% F B- (sf) 12.00 6.50 Three/six-month EURIBOR plus 8.18% Sub notes NR 39.60 N/A N/A *The preliminary ratings assigned to the class A and B notes address timely interest and ultimate principal payments. Our preliminary ratings address ultimate interest and principal payments on the rest of the other rated notes. §The payment frequency switches to semiannual and the index switches to six-month EURIBOR when a frequency switch event occurs. EURIBOR--Euro Interbank Offered Rate. NR--Not rated. N/A--Not applicable. INVESCO EURO XVII: S&P Assigns Prelim B-(sf) Rating to Cl. F Notes ------------------------------------------------------------------ S&P Global Ratings assigned its preliminary credit ratings to Invesco Euro CLO XVII DAC's class X A, B, C, D, E, and F notes. At closing, the issuer will also issue EUR27.34 million unrated subordinated notes. The reinvestment period will be approximately 4.5 years, while the noncall period will be 1.5 years after closing. Under the transaction documents, the rated notes will pay quarterly interest unless there is a frequency switch event. Following this, the notes will switch to semiannual payment. The preliminary ratings assigned to the notes reflect S&P's assessment of: -- The diversified collateral pool, which primarily comprises broadly syndicated speculative-grade senior secured term loans and bonds that are governed by collateral quality tests. -- The credit enhancement provided through the subordination of cash flows, excess spread, and overcollateralization. -- The collateral manager's experienced team, which can affect the performance of the rated notes through collateral selection, ongoing portfolio management, and trading. -- The transaction's legal structure, which S&P expects to be bankruptcy remote. -- The transaction's counterparty risks, which S&P expects to be in line with its counterparty rating framework. Portfolio benchmarks S&P Global Ratings' weighted-average rating factor 2,629.30 Default rate dispersion 619.59 Weighted-average life (years) 4.55 Obligor diversity measure 128.38 Industry diversity measure 25.27 Regional diversity measure 1.39 Transaction key metrics Total par amount (mil. EUR) 350 Defaulted assets (mil. EUR) 0 Number of performing obligors 142 Portfolio weighted-average rating derived from S&P's CDO evaluator B 'CCC' category rated assets (%) 1.43 Target 'AAA' weighted-average recovery (%) 37.51 Actual weighted-average spread net of floors (%) 3.62 Actual weighted-average coupon (%) 5.63 The transaction also features a principal redemption mechanism for the class E and F notes (turbo redemption). Via the turbo redemption, 10.00% of the remaining interest proceeds available before equity distribution are used to pay down principal on the class E and F notes, respectively. S&P has not given credit to turbo redemption in our cash flow analysis, considering the position of the payments in the waterfall and the ability to divert interest proceeds to purchase workout loans and bankruptcy exchange. Rationale S&P said, "Our preliminary ratings reflect our assessment of the collateral portfolio's credit quality, which has a weighted-average rating of 'B'. "The portfolio is well-diversified, primarily comprising broadly syndicated speculative-grade senior secured term loans and bonds. Therefore, we conducted our credit and cash flow analysis by applying our criteria for corporate cash flow CDOs. "In our cash flow analysis, we used the EUR350.0 million target par amount, the target weighted-average spread of 3.62%, the target weighted-average coupon of 5.63%, and the target weighted-average recovery rate. We applied various cash flow stress scenarios, using four different default patterns, in conjunction with different interest rate stress scenarios for each liability rating category. "At closing, we expect the transaction's documented counterparty replacement and remedy mechanisms to adequately mitigate its exposure to counterparty risk under our current counterparty criteria. "Under our structured finance sovereign risk criteria, the transaction's exposure to country risk is sufficiently mitigated at the assigned preliminary ratings. "We expect the transaction's legal structure and framework to be bankruptcy remote, in line with our legal criteria. "Our credit and cash flow analysis indicates that the available credit enhancement for the class B to F notes could withstand stresses commensurate with higher ratings than those assigned. However, as the CLO will be in its reinvestment phase starting from the effective date, during which the transaction's credit risk profile could deteriorate, we have capped our preliminary ratings assigned to the notes." The class X and A notes can withstand stresses commensurate with the assigned preliminary ratings. S&P said, "Following our analysis of the credit, cash flow, counterparty, operational, and legal risks, we believe that our preliminary ratings are commensurate with the available credit enhancement for all rated classes of notes. "In addition to our standard analysis, we have also included the sensitivity of the ratings on the class X to E notes, based on four hypothetical scenarios." Environmental, social, and governance S&P regards the exposure to environmental, social, and governance (ESG) credit factors in the transaction as being broadly in line with our benchmark for the sector. Primarily due to the diversity of the assets within CLOs, the exposure to environmental credit factors is viewed as below average, social credit factors are below average, and governance credit factors are average. For this transaction, the documents prohibit assets from being related to certain activities. Accordingly, since the exclusion of assets from these industries does not result in material differences between the transaction and S&P's ESG benchmark for the sector, no specific adjustments have been made in its rating analysis to account for any ESG-related risks or opportunities. Invesco Euro CLO XVII DAC is a European cash flow CLO securitization of a revolving pool, comprising euro-denominated senior secured loans and bonds issued mainly by speculative-grade borrowers. The transaction will be managed by Invesco CLO Equity Fund 6 LLC. Ratings Prelim Prelim amount Credit Class rating* (mil. EUR) enhancement (%) Interest rate§ X AAA (sf) 3.00 N/A Three/six-month EURIBOR plus 0.93% A AAA (sf) 217.00 38.00 Three/six-month EURIBOR plus 1.29% B AA (sf) 38.50 27.00 Three/six-month EURIBOR plus 1.90% C A (sf) 21.00 21.00 Three/six-month EURIBOR plus 2.40% D BBB- (sf) 24.50 14.00 Three/six-month EURIBOR plus 3.50% E BB- (sf) 16.30 9.34 Three/six-month EURIBOR plus 6.35% F B- (sf) 4.00 8.20 Three/six-month EURIBOR plus 7.84% Sub notes NR 27.34 N/A N/A *The preliminary ratings assigned to the class X, A, and B notes address timely interest and ultimate principal payments. Our preliminary ratings address ultimate interest and principal payments on the other rated notes. The payment frequency switches to semiannual and the index switches to six-month EURIBOR when a frequency switch event occurs. EURIBOR--Euro Interbank Offered Rate. NR--Not rated. N/A--Not applicable. SOUND POINT 17: S&P Assigns B- (sf) Rating to Class F Notes ----------------------------------------------------------- S&P Global Ratings assigned its credit ratings to Sound Point Euro CLO 17 Funding DAC's class A, B, C, D, E, and F European cash flow CLO notes. At closing, the issuer also issued unrated subordinated notes. Under the transaction documents, the rated notes pay quarterly interest unless a frequency switch event occurs. Following this, the notes will permanently switch to semiannual payments. The portfolio's reinvestment period will end approximately five years after closing, while the noncall period will end two years after closing. The ratings reflect S&P's assessment of: -- The diversified collateral pool, which primarily comprises broadly syndicated speculative-grade senior secured term loans and bonds that are governed by collateral quality tests. -- The credit enhancement provided through the subordination of cash flows, excess spread, and overcollateralization. -- The collateral manager's experienced team, which can affect the performance of the rated loans and notes through collateral selection, ongoing portfolio management, and trading. -- The transaction's legal structure, which is bankruptcy remote. -- The transaction's counterparty risks, which are in line with S&P's counterparty rating framework. Portfolio benchmarks S&P Global Ratings' weighted-average rating factor 2,724.53 Default rate dispersion 470.83 Weighted-average life (years) 5.24 Obligor diversity measure 126.93 Industry diversity measure 23.58 Regional diversity measure 1.23 Transaction key metrics Portfolio weighted-average rating derived from S&P's CDO evaluator B 'CCC' category rated assets (%) 0.50 Target 'AAA' weighted-average recovery (%) 36.21 Target weighted-average spread (net of floors; %) 3.45 Rating rationale S&P said, "Our ratings reflect our assessment of the collateral portfolio's credit quality, which has a weighted-average rating of 'B'. The target portfolio is well-diversified, primarily comprising broadly syndicated speculative-grade senior secured term loans and senior secured bonds. Therefore, we have conducted our credit and cash flow analysis by applying our criteria for corporate cash flow CDOs. "In our cash flow analysis, we used the EUR400 million target par amount, the target weighted-average spread (3.45%), the reference weighted-average coupon (4.50%), and the target portfolio weighted-average recovery rates for all rated notes. We applied various cash flow stress scenarios, using four different default patterns, in conjunction with different interest rate stress scenarios for each liability rating category. "Until the end of the reinvestment period on July 20, 2031, the collateral manager may substitute assets in the portfolio for so long as our CDO Monitor test is maintained or improved in relation to the initial ratings on the notes. As a result, until the end of the reinvestment period, the collateral manager may through trading deteriorate the transaction's current risk profile, if the initial ratings are maintained. "The transaction's documented counterparty replacement and remedy mechanisms adequately mitigate its exposure to counterparty risk under our current counterparty criteria. "Under our structured finance sovereign risk criteria, the transaction's exposure to country risk is sufficiently mitigated at the assigned ratings. "The transaction's legal structure and framework is bankruptcy remote, in line with our legal criteria. "The transaction's legal structure and framework is bankruptcy remote. The issuer is a special-purpose entity that meets our criteria for bankruptcy remoteness. "Our credit and cash flow analysis shows that the class B, C, D, and E notes benefit from break-even default rate and scenario default rate cushions that we would typically consider to be in line with higher ratings than those assigned. However, as the CLO is still in its reinvestment phase, during which the transaction's credit risk profile could deteriorate, we have capped our ratings on the notes. The class A notes can withstand stresses commensurate with the assigned ratings. "For the class F notes, our credit and cash flow analysis indicate that the available credit enhancement could withstand stresses commensurate with a lower rating. However, we have applied our 'CCC' rating criteria, resulting in a 'B- (sf)' rating on this class of notes." The ratings uplift for the class F notes reflects several key factors, including: -- The class F notes' available credit enhancement, which is in the same range as that of other CLOs S&P has rated and that has recently been issued in Europe. -- The portfolio's average credit quality, which is similar to other recent CLOs. -- S&P's model generated a break-even default rate at the 'B-' rating level of 25.67% (for a portfolio with a weighted-average life of 5.24 years), versus if it was to consider a long-term sustainable default rate of 3.2% for 5.24 years, which would result in a target default rate of 16.77%. -- S&P does not believe that there is a one-in-two chance of this note defaulting. -- S&P does not envision this tranche defaulting in the next 12-18 months. -- Following this analysis, S&P considers that the available credit enhancement for the class F notes is commensurate with the assigned 'B- (sf)' rating. S&P said, "Following our analysis of the credit, cash flow, counterparty, operational, and legal risks, we believe our ratings are commensurate with the available credit enhancement for the class A to F notes. "In addition to our standard analysis, we have also included the sensitivity of the ratings on the class A to E notes based on four hypothetical scenarios. "As our ratings analysis makes additional considerations before assigning ratings in the 'CCC' category--and we would assign a 'B-' rating if the criteria for assigning a 'CCC' category rating are not met--we have not included the above scenario analysis results for the class F notes." Environmental, social, and governance S&P said, "We regard the exposure to environmental, social, and governance (ESG) credit factors in the transaction as being broadly in line with our benchmark for the sector. Primarily due to the diversity of the assets within CLOs, the exposure to environmental credit factors is viewed as below average, social credit factors are below average, and governance credit factors are average. "For this transaction, the documents prohibit assets from being related to certain activities. Since the exclusion of assets from these industries does not result in material differences between the transaction and our ESG benchmark for the sector, no specific adjustments have been made in our rating analysis to account for any ESG-related risks or opportunities." Ratings Amount Credit Class Rating* (mil. EUR) enhancement (%) Interest rate§ A AAA (sf) 248.00 38.00 Three/six-month EURIBOR plus 1.26% B AA (sf) 44.00 27.00 Three/six-month EURIBOR plus 1.75% C A (sf) 24.00 21.00 Three/six-month EURIBOR plus 1.95% D BBB- (sf) 28.00 14.00 Three/six-month EURIBOR plus 2.90% E BB- (sf) 19.00 9.25 Three/six-month EURIBOR plus 5.25% F B- (sf) 11.00 6.50 Three/six-month EURIBOR plus 8.59% Sub. notes NR 32.00 N/A N/A *The ratings assigned to the class A and B notes address timely interest and ultimate principal payments. The ratings assigned to the class C, D, E, and F notes address ultimate interest and principal payments. §The payment frequency switches to semiannual and the index switches to six-month EURIBOR when a frequency switch event occurs. EURIBOR--Euro Interbank Offered Rate. NR--Not rated. N/A--Not applicable. =================== L U X E M B O U R G =================== SIRONA HOLDCO: S&P Lowers ICR to 'SD' on Deferred Interest Payment ------------------------------------------------------------------ S&P Global Ratings lowered its long-term issuer credit rating on Sirona Holdco (Seqens) to 'SD' (selective default) from 'CCC', and its long-term issue rating on the company's term loan B (TLB) to 'D' (default). S&P expects to reassess the issuer credit rating in the near term, considering restructuring discussions between stakeholders are still ongoing and that these are likely to result in a distressed restructuring. Seqens has received approval from at least 65% of the lender syndicate--on its EUR930 million outstanding term loan facility, maturing June 15, 2028, and fully drawn EUR130 million revolving credit facility (RCF)--to defer its interest payment, which were due June 16, 2026 via a forbearance agreement. S&P views this as a default because the deferred payment obligation has surpassed the 30-calendar-day grace period allowed by the documentation and in our ratings definitions. S&P said, "We lowered our long-term issuer credit rating on Sirona Holdco (Seqens) to 'SD' and our long-term issue rating on the TLB to 'D'. We view the deferred interest payment of Seqens' EUR930 million TLB and EUR130 million RCF in agreement with lenders, as a default since creditors will not receive their initial promise in a timely manner. Under the terms of the debt documentation, a 30-calendar-day grace period is provided; as this period has now elapsed having commenced on June 16, the nonpayment after 30 days qualifies as a default under our rating criteria." The missed payment pertains to the company's debt facilities originally issued by SK Capital Partners to finance the 2021 leveraged buyout of Seqens. The interest deferral decision was established via a forbearance agreement with 65% of the lender syndicate, which prohibits lenders from accelerating the debt and defers interest payments until Nov. 30, 2026, at the latest. The 'SD' rating on Seqens reflects the company has defaulted on a portion of its debt. While interest payments have been deferred on the TLB and the RCF, the company continues to service its remaining financial obligations, including EUR73 million in bilateral loans and the recently raised EUR70 million super senior bridge facility. S&P said, "As these non-defaulting obligations represent approximately 15% of the total debt burden, we lowered our long-term issuer credit rating on Seqens to 'SD' rather than 'D', given the company still pays annuities on these loans, while we lowered our issue rating on the affected TLB to 'D' (the RCF is not rated)." Seqens has initiated both an operational and financial restructuring process to rationalize its business scope and address its unsustainable capital structure. First-quarter 2026 operating performance showed some stabilization, benefiting from supportive phenol and acetone market conditions and generally resilient trading across the company's business lines. However, the company continued to generate deeply negative free operating cash flow because it was simultaneously executing an extensive operational transformation program--including Phoenix commissioning, site restructuring, portfolio optimization, and disposal activities--which required substantial restructuring expenses, project investments, and other one-off cash outflows. Consequently, liquidity remained critically constrained, with cash and liquid investments declining to only EUR18 million as of March 2026 while the RCF remained fully drawn. As of July 2026, Seqens' debt profile is as follows: -- EUR930 million TLB due June 2028; -- EUR130 million fully drawn RCF due December 2027 (which is pari passu with the TLB); -- EUR73 million of bilateral loans issued at subsidiary level with diverse maturity dates; and -- EUR70 million super senior bridge loan at the U.K. subsidiary level expiring September 2031. To preserve operational liquidity during restructuring negotiations, Seqens secured the aforementioned EUR70 million super senior bridge loan, funded equally by the sponsor and lenders. The facility is priced at an interim pricing of 10%, comprising a mix of cash and payment-in-kind interest. This new super senior secured facility is considered senior to the existing TLB and RCF in the recovery waterfall. While the bridge financing provides short-term liquidity to support operations, it does not resolve the company's unsustainable capital structure, and S&P continues to view the current liquidity profile as weak. S&P said, "We expect to reassess the issuer credit rating in a matter of days after the default driven by the missed interest payment. We anticipate that the rating will be largely guided by the still-ongoing discussions between the stakeholders. We understand that ongoing restructuring negotiations between the company, its shareholders, and the lender pool may lead to a debt-to-equity swap, which would likely constitute a distressed exchange under our criteria. We intend to review the ratings when the agreed restructuring is formally implemented, if it materializes, which could qualify as another selective default. We would subsequently reassess the ratings based on the new capital structure. Regarding covenants, as per the senior facility agreement, only the RCF has a springing super senior net leverage covenant at 8.8x, tested only if RCF utilization net of cash and cash equivalents exceeds 40% of the total RCF commitment. We understand that covenants were not breached in April 2026, but we expect Seqens to breach on the next calculation date given its current senior secured net leverage ratio of 17.0x (as per company calculation)." =========== T U R K E Y =========== TURK HAVA: Fitch Affirms 'BB' Long-Term IDR, Outlook Stable ----------------------------------------------------------- Fitch Ratings has affirmed Turk Hava Yollari Anonim Ortakligi's (Turkish Airlines; THY) Long-Term Foreign- and Local-Currency Issuer Default Ratings (IDR) at 'BB'. The Outlook is Stable. Fitch has also affirmed Bosphorus Pass Through Certificates Series 2015-1A's class A notes at 'BB+'. The affirmation reflects THY's manageable exposure to the Middle East conflict, supported by flexibility to redeploy capacity and the benefit of higher cargo rates. However, Fitch expects the company's margins to come under pressure from higher fuel prices, given its lower fuel hedging relative to peers. Fitch now expects EBITDAR leverage to rise to 4.8x, breaching its negative sensitivity in 2026. The Stable Outlook reflects its expectation that the EBITDAR leverage will return to the sensitivity by 2027 although headroom is limited. This deleveraging relies on lower fuel cost assumption expected for 2027. Any deviation to Fitch's forecast could lead to negative rating action. Key Rating Drivers Exposure to Middle East Conflict: THY has contained direct exposure to the Middle East conflict, with around 7% of capacity deployed in the region at end-2025. The airline mitigated disruption by reallocating capacity to stronger-demand markets and benefited from higher fares, load factors and cargo rates amid reduced Middle Eastern carrier capacity. Fitch expects the conflict to affect THY primarily through higher fuel costs, given its relatively limited fuel hedging versus EMEA full-service carrier peers. At end-2025, THY had hedged 36% of its 2026 fuel consumption on crude oil. Fitch has revised its average crude oil assumption for 2026 to USD 87/bbl with a crack spread of around USD40/bbl. Fitch forecasts EBITDAR to decline to USD4.3 billion in 2026 from its previous forecast of USD4.8 billion. Releveraging Trend: THY's gross debt, including lease-adjusted debt, had increased by around USD4 billion at end-2025, reflecting the acceleration of its fleet deliveries and broader growth strategy. Fitch expects EBITDAR leverage to peak at 4.8x in 2026, as Fitch expects EBITDAR to be affected by the Middle East conflict while lease liabilities continue to rise in line with ongoing fleet additions. Fitch forecasts leverage will return to the sensitivity by 2027 at 3.9x with limited rating headroom. Fitch sees execution risk in THY's deleveraging path, as it relies on sustained operating stability through 2028, leaving limited headroom for operational underperformance or further external shocks. This is mitigated by the company's proven ability to react to adverse external developments. Fitch sees management's cost optimisation plan as a potential upside to deleveraging. Fleet Delivery Acceleration: THY's strategic plan targets a fleet of more than 800 aircraft by 2033, up from 516 at end-2025. Deliveries are expected to be concentrated in 2026 and 2027, with around 50 aircraft added annually, mainly narrow-body aircraft. Fleet renewal and expansion should support operating efficiency and product enhancement, but will also drive a material increase in capex and debt. Fitch expects fleet growth to be funded primarily through leases. Management Flexibility Supports Downside Mitigation: THY retains meaningful management levers to mitigate a further deterioration in profitability. These include a cost optimisation plan over 2026-2028 targeting USD1-1.5 billion and additional capex flexibility through the deferral of non-core projects. Its rating case does not assume any benefit from the cost optimisation plan on top of the measures already implemented in 2026. During the pandemic, the company demonstrated its capacity to optimise its cost base, limiting the impact of the crisis and supporting a faster recovery. Government Ownership Limits IDR: THY is 49.12%-owned by Turkiye Wealth Fund (TWF), which is fully state-owned, and the government directly or indirectly nominates seven out of its nine board members. However, all of THY's non-equity funding is external and managed autonomously with independent operations and cash management. Fitch consequently views access and control as 'porous' under its Parent and Subsidiary Linkage Rating Criteria, which together with an 'open' assessment of legal ring-fencing, constrains THY's Long-Term Local-Currency IDR at one notch above the sovereign rating. Preferential Treatment Pierces Country Ceiling: THY's Long-Term Foreign-Currency IDR exceeds Turkey's 'BB-' Country Ceiling, reflecting airlines' exemption from Turkish regulation to convert a portion of exporters' FC revenues into lira. In addition, nearly all of THY's hard-currency external obligations are aircraft leases. Fitch views restrictions on lease payments as unlikely for THY, given its flagship carrier status and the risk of operational disruptions from possible aircraft repossessions. Bosphorus Certificates Top Down Approach: Fitch continues to rate the notes using a top-down approach, given the continued reduction in outstanding principal. The notes can tolerate stress up to 'AA', which is consistent with a maximum loan-to-value (LTV) of 8%. This is because their favourable amortisation profile without balloon payments at maturity in March 2027 causes the LTV to fall rapidly closer to maturity. The collateral is three 2015 vintage B777-300ERs, which Fitch views as tier 2 assets. However, this still results in the same 'BB+' rating, capped at two notches above Turkiye's Country Ceiling. Transfer and Convertibility Risk Mitigated: Based on Fitch's Aircraft Enhanced Equipment Trust Certificates (EETC) Rating Criteria and Exceeding Country Ceiling Criteria, the certificates benefit from offshore structural enhancements. These include the EETC structure, its collateral, and an offshore liquidity facility from Paris-based BNP Paribas SA (AA-/Stable), which can cover 18 months of debt service to prevent a default. This mitigates transfer and convertibility risk and enables the notes' rating to exceed the Country Ceiling by two notches. Peer Analysis Fitch views British Airways Plc (BBB/Stable, Standalone Credit Profile (SCP): bbb-), Air France KLM (BBB-/Stable) and Deutsche Lufthansa AG (BBB-/Stable) as THY's peers, given their comparable business profiles. The three European legacy carriers benefit from a better location than THY to capture profitability from transatlantic connections as well as more stable home market conditions, although THY has benefited from a strong recovery in tourism in Turkiye. THY's 'bb' SCP implies moderately lower debt capacity than its peers, given its more volatile home market and higher FX exposure. THY's IDR is one notch above Turkiye's 'BB-' Country Ceiling, reflecting both its links with its key shareholder, the government of Turkiye, and its view that THY meets the conditions needed to pierce the Country Ceiling. THY has a more robust business profile than its domestic competitor Pegasus Hava Tasimaciligi A.S. (BB-/Negative), due to a larger fleet, wider geographic footprint, significantly stronger market position, and a more diversified revenue base. These factors also lead to THY's moderately higher debt capacity for a given rating than Pegasus. Fitch’s Key Rating-Case Assumptions Available seat kilometre 6% CAGR to 2028 Load-factor to close to 85% in 2026 declining to 83% for 2027-2028 Yield at USD0.09 per revenue passenger kilometre in 2026 then USD0.088 in 2027 and USD0.087 in 2028. Unhedged jet fuel price of USD1,050/t in 2026, declining to USD750/t in 2027 and close to USD700/t thereafter Cargo revenues 6% CAGR to 2028 Capex averaging USD3.3 billion a year, in line with the company's guidance for 2026-2028 Corporate Rating Tool Inputs and Scores Fitch scored the issuer as follows, using its Corporate Rating Tool (CRT) to produce the Standalone Credit Profile (SCP): Business and financial profile factors (assessment, relative importance): management ('bbb', Lower), sector characteristics ('bb+', Moderate), market and competitive positioning ('bbb-', Moderate), diversification and asset quality ('bbb-', Moderate), company operational characteristics ('bbb-', Higher), profitability ('bb', Moderate), financial structure ('b+', Higher), and financial flexibility ('bb', Moderate). The quantitative financial subfactors are based on custom CRT financial period parameters: 10% weight for the forecast year 2026, 45% for the forecast year 2027 and 45% for the forecast year 2028. The operating environment assessment of 'bbb-' has no impact. The governance assessment of 'good' has no impact. The SCP is 'bb'. To derive the Long-Term IDR: Application of Fitch's Parent Subsidiary Linkage Rating Criteria results in a(n) consolidated profile+1 approach. Application of Fitch's Government Related Entities Rating Criteria results in a(n) standalone approach. Country Ceiling considerations apply and result in an adjustment of 0 notch(es). RATING SENSITIVITIES THY Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade - A downgrade of Turkiye's sovereign rating and downward revision of the Country Ceiling - Tighter links with the government - EBITDAR leverage above 4.0x and EBITDAR fixed charge cover below 2.2x, all on a sustained basis Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade - An upgrade of Turkiye's sovereign rating and upward revision of the Country Ceiling, if accompanied by an upward revision of THY's SCP, and provided links to Turkiye are unchanged - EBITDAR leverage below 3.0x and EBITDAR fixed charge cover over 2.7x, all on a sustained basis, could lead to an upward revision of the SCP Bosphorus Pass Through Certificates Series 2015-1A Factors That Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade - An upward revision of Turkiye's Country Ceiling Factors That Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade - A downward revision of Turkiye's Country Ceiling For Turkiye's Rating Sensitivities, see 'Fitch Revises Turkiye's Outlook to Positive; Affirms at 'BB-'' dated 10 April 2026. Liquidity and Debt Structure THY had USD6.4 billion cash at March-2026, comprising USD1.6 billion cash and USD4.8 billion Fitch-adjusted cash equivalents (mostly cash deposits). This was complemented by USD4.8 billion of uncommitted and undrawn facilities at March-2026. Fitch expects the company to remain free cash flow positive, despite the ambitious capex programme and expectation of around USD2 billion leases over the forecast horizon. THY's credit lines are renewed annually. Like other Turkish and emerging-market corporates, the company does not pay commitment fees. It has been successful in renewing its credit lines, and given its state ownership, Fitch believes these lines will remain available, but do not include them in its liquidity analysis. Historically, almost all its credit lines were with local Turkish banks. Recently the company raised USD2.1 billion borrowings from international banks. Issuer Profile THY is a Turkish flagship carrier and one of the largest European network carriers. It operates from its hub at Istanbul airport. Public Ratings with Credit Linkage to other ratings THY's IDRs are linked to Turkiye's sovereign IDRs. MACROECONOMIC ASSUMPTIONS AND SECTOR FORECASTS Fitch's latest quarterly Global Corporates Sector Forecasts Monitor data file which aggregates key data points used in its credit analysis. Fitch's macroeconomic forecasts, commodity price assumptions, default rate forecasts, sector key performance indicators and sector-level forecasts are among the data items included. Climate Vulnerability Signals The FY25 revenue-weighted Climate. VS for THY for 2035 is 50 out of 100, suggesting elevated exposure to climate-related risks in that year. This is in line with other airlines and reflects the gradually growing costs linked to the decarbonisation of the sector. Climate transition risks do not have a material influence on airline ratings, including THY's, because the potentially disruptive changes due to transition are unlikely to materialise in the next eight to 10 years. Incremental costs due to the Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA), and non-mandated sustainable aviation fuel (SAF) usage, are also applicable to THY's peer group, and Fitch has included them in its forecasts. THY has committed to carbon neutrality by 2050 and plans to achieve its target through a combination of fleet renewal, increased use of SAF and offsetting the remaining emissions. The company expects that the fleet modernisation will reduce emissions by 30% by 2050, with an objective of 90% of new generation aircraft by 2033. The transition to new-technology aircraft is part of usual asset renewal, which helps decarbonisation but leads to high capex. THY is investing in research and development for SAF with the objective by 2050 of reducing its emissions by another 35%. The remaining 35% of emissions will be offset by existing mechanisms, such as CORSIA. Fitch views THY's net zero target as achievable but will heavily depend on new technologies, which are still under development and are not factored into the company's announced plans. ESG Considerations The highest level of ESG credit relevance is a score of '3', unless otherwise disclosed in this section. A score of '3' means ESG issues are credit-neutral or have only a minimal credit impact on the entity, either due to their nature or the way in which they are being managed by the entity. Fitch's ESG Relevance Scores are not inputs in the rating process; they are an observation on the relevance and materiality of ESG factors in the rating decision. Entity/Debt Rating Prior ----------- ------ ----- Turk Hava Yollari Anonim Ortakligi (Turkish Airlines) LT IDR BB Affirmed BB LC LT IDR BB Affirmed BB Bosphorus Pass Through Certificates Series 2015-1A senior secured LT BB+ Affirmed BB+ VESTEL ELEKTRONIK: Moody's Cuts CFR & Sr. Unsecured Notes to Caa3 ----------------------------------------------------------------- Moody's Ratings has downgraded the long-term corporate family rating of Vestel Elektronik Sanayi Ve Ticaret A.S. (Vestel or the company) to Caa3 from Caa2 and has appended a limited default (LD) designation to the probability of default rating, downgrading and revising it to Caa3-PD/LD from Caa2-PD. The LD component will be removed after three business days. Moody's have also downgraded to Caa3 from Caa2 the instrument rating on the $500 million guaranteed senior unsecured notes due 2029 issued by Vestel. The outlook remains negative. RATINGS RATIONALE The rating action reflects Vestel's entry into restructuring negotiations with its Turkish banking lenders under Provisional Article 32 of Banking Law No. 5411, which provides an established framework for out-of-court financial restructurings in Turkiye. The company has entered into an initial three-month standstill with Turkish banks that account for the vast majoirty of its financial debt. During the standstill period, scheduled principal and interest payments will be deferred and accrued while the parties negotiate a restructuring agreement. Vestel has indicated that it is seeking maturity extensions. However, Moody's believes that restoring a sustainable capital structure is likely to require a more comprehensive restructuring, including a material reduction in debt obligations and meaningful operational restructuring initiatives. Even if such measures are implemented successfully, Moody's expects there will remain uncertainty regarding the company's ability to return to a viable and sustainable operating model, despite the company's stated focus on improvements through cost and supply chain optimization. Moody's considers the commencement of the standstill to be a distressed exchange under Moody's definitions of default because it allows Vestel to avoid a likely payment default and results in lenders accepting less value than originally promised by converting cash-pay obligations into claims with deferred and accrued payments. Consequently, Moody's have appended a limited default (LD) designation to the company's PDR. The default is considered limited because it applies only to debt held by participating Turkish banks and excludes the company's $500 million international bond, Turkish lira-denominated bonds and certain other obligations. Although the $500 million bond is currently outside the standstill arrangement Moody's believes the company's ability to meet the next interest payment of approximately $25 million due in November 2026 remains uncertain. Vestel's operating performance continued to deteriorate during the first quarter of 2026. While hyper-inflation accounting makes it difficult to compare results on a quarterly basis, the company reported a 49% decline in revenue against the same period a year earlier and Moody's expects EBITDA and free cash flow have continued to weaken further from negative TRY5.8 billion Moody's-adjusted EBITDA and TRY13.9 billion Moody's-adjusted free cash outflow in 2025. Even if creditors agree to material debt reductions, it could take the company several years to return to positive EBITDA generation, and Moody's expects profitability to remain materially below historical levels. Vestel's Caa3 CFR continues to reflect (1) the company's historically meaningful, but more recently weakened, market position in televisions and household appliances in Turkiye and Europe; (2) a diversified business model spanning own brands, licensed brands and original design manufacturing (ODM), which provides some diversification across customers and products; and (3) exposure to mobility electronics and energy storage, which could benefit from longer-term growth in electric vehicles and renewable energy, although these activities remain relatively small and are insufficient to offset weakness in the core appliance business. The rating also reflects (1) Vestel's unsustainable capital structure and weak liquidity, which have resulted in the company entering negotiations to restructure its debt; (2) uncertainty regarding the viability of the company's operating model even under a materially reduced debt burden, as evidenced by five consecutive years of negative free cash flow and Moody's expectations that free cash flow will remain negative over at least the next two to three years; (3) a weakened competitive position across its core products and markets amid intensifying competition from Chinese manufacturers and other Turkish producers; and (4) exposure to the structurally challenged global television market, compounded by volatile input costs. RATING OUTLOOK The negative outlook reflects downside risk to Moody's recovery expectations for Vestel's debt. Uncertainty remains regarding both the magnitude of debt reduction required to restore a sustainable capital structure and the company's ability to maintain a viable operating model following a restructuring. Moody's expects operating conditions to remain challenging over the next 12-18 months and anticipate that the company will require additional funding to support its operations during this period. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS Given the negative outlook, an upgrade is unlikely in the near term. Moody's could revise the outlook to stable if Vestel's operating performance and debt position stabilize. An upgrade would likely require the successful completion of the restructuring negotiations, a return to the timely servicing of debt obligations, and a material reduction in debt. In addition, Moody's would need greater confidence that the company can restore a sustainable operating model and, over time, generate positive free cash flow. Moody's could downgrade the rating if Moody's expects recovery on the company's debt to materially weaken against Moody's current expectations of 65% to 80%. The principal methodology used in these ratings was Consumer Durables published in December 2025. Vestel's Caa3 rating is two notches below the scorecard-indicated outcome of Caa1. This reflects Moody's views that the company is in default on a substantial portion of its debt and is engaged in negotiations to restructure its obligations. Given the significant credit challenges the company is facing, there is a high degree of uncertainty regarding losses for creditors in the near future, a risk that is not fully captured by the scorecard outcome. =========================== U N I T E D K I N G D O M =========================== AEA INTERNATIONAL: Moody's Rates New $700MM Secured Term Loan 'Ba3' ------------------------------------------------------------------- Moody's Ratings has assigned Ba3 ratings to the proposed $700 million backed senior secured term loan B (TLB) to be borrowed by AEA International Holdings (Lux) S.a.r.l. (I-SOS) and to the proposed $114 million backed senior secured revolving credit facility (RCF) to be borrowed by AEA International Holdings Pte. Ltd. Both entities' ratings are unaffected – including I-SOS' Ba3 long-term corporate family rating (CFR) and the Ba3-PD probability of default rating (PDR). The stable outlooks are also unaffected by the debt issuance. RATINGS RATIONALE The assigned Ba3 instrument ratings are in line with I-SOS' CFR, which reflects the company's senior secured-only capital structure. The proposed TLB and RCF will be guaranteed by material subsidiaries incorporated in the US, UK, Australia, the Netherlands, Singapore and Luxembourg. Moody's considers the security package, which comprises a share pledge over certain material subsidiaries, as weak. I-SOS will use the proceeds from the proposed TLB primarily to repay its outstanding $672 million backed senior secured TLB maturing in September 2028, with the remainder increasing the company's cash balance. The transaction will effectively extend the maturity of I-SOS' current capital structure by four-five years. Despite modest incremental debt, Moody's expects the company's Moody's-adjusted debt/EBITDA to remain well below 4.5x over the next 12-18 months. I-SOS' Ba3 CFR reflects the company's (1) differentiated and defensible market position as the only global integrated provider of assistance and medical services; (2) long track record of solid organic growth, underpinned by solid market fundamentals and good revenue visibility through subscription revenues and multi-year contracts; and (3) balanced financial policy, with a commitment to maintaining moderate financial leverage. The rating also factors in (1) I-SOS' exposure to extractive industries and travel activity; (2) competition from unbundled offerings and the requirement for ongoing digital investments; and (3) fluctuations in the contract portfolio for medical services, depending on macroeconomic conditions and government spending decisions. RATING OUTLOOK The stable outlook reflects Moody's expectations that I-SOS will continue to achieve solid organic revenue growth over the next 12-18 months, while maintaining a balanced financial policy with good liquidity. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS Moody's could upgrade I-SOS' ratings if it maintains solid operating metrics with revenue growth and at least stable margins; reduces debt/EBITDA below 3.5x; and increases free cash flow (FCF) to debt to 10% on a sustainable basis, while preserving good liquidity (all metrics are Moody's-adjusted). Moody's could downgrade I-SOS' ratings if its operating metrics weaken notably through a revenue or margin contraction, including a material contract loss; debt/EBITDA exceeds 4.5x; and FCF/debt reduces below 5% on a sustained basis; or if liquidity deteriorates significantly (all metrics are Moody's-adjusted). PRINCIPAL METHODOLOGY The principal methodology used in these ratings was Business and Consumer Services published in February 2026. COMPANY PROFILE I-SOS is a leading global provider of assistance and medical services to companies, governments and other public entities, with headquarters in London and Singapore. The company is privately owned, with its equity mainly held by its founders – Arnaud Vaissie, Dr Pascal Rey-Herme and Laurent Sabourin – and minority shareholders Copeba and Peugeot Invest, which each hold a stake of around 15%. In the 12 months ended December 31, 2025, I-SOS generated revenue of $1.5 billion and Moody's-adjusted EBITDA of $229 million. BOND UK 3: S&P Assigns 'B' ICR on Coatings Carve-Out From BASF SE ----------------------------------------------------------------- S&P Global Ratings assigned its 'B' long-term issuer credit rating to Bond UK MidCo 3 Ltd. (Surventis). S&P said, "We also assigned our 'B' issue rating to Surventis' EUR4.55 billion senior secured credit facilities due 2033, which include a multi-currency term loan B (TLB), split into $1.2 billion, EUR1 billion, and EUR600 million-equivalent Chinese yuan-denominated tranches, and $750 million and EUR1.25 billion senior secured notes with a recovery rating of '3', indicating our expectation of about 60% recovery for debtholders in a payment default. "The stable outlook reflects our expectation that gradual EBITDA improvement from efficiency initiatives and organic business growth will lead to adjusted debt to EBITDA of about 6.3x-6.6x in 2026." On July 1, 2026, Carlyle Group, in partnership with Qatar Investment Authority (QIA), and BASF SE announced completion of the carve-out transaction of BASF's coating division. The new entity will operate under the name Surventis. The transaction, valued at EUR7.7 billion, was financed through a mix of senior secured debt, issued by Bond UK MidCo 3 Ltd. (Surventis) through its financing subsidiaries, and common equity. At the transaction's close, Carlyle holds a controlling stake in Surventis of about 45%, QIA holds about 15%, while BASF retains the remainder (40%). Surventis' business risk profile benefits from leading market positions, technological capabilities, and long-standing customer relationships. The group is the global leader in surface treatment and automotive original equipment manufacturer (OEM) coatings and holds the third-largest global share in automotive refinish coatings, after Axalta and PPG Industries. Surventis' diversified geographic footprint spans both developed and emerging markets, supported by 31 production facilities worldwide that provide over 90% local coverage in key regions, including Europe, the U.S., and China. Surventis' product portfolio primarily comprises value-added coatings solutions and is backed by ongoing research and development (R&D) and strong technical know-how. The group serves over 40,000 customers globally and has long-term relationships with key global automotive OEM players. S&P said, "The group's smaller scale relative to specialty chemicals peers and substantial end-market concentration constrain our business risk assessment. With revenue of EUR3.9 billion in 2025, Surventis is almost of the same size as Axalta (EUR4.4 billion) but significantly smaller than larger peers such as RPM International (EUR6.8 billion) and PPG (EUR13.5 billion). Furthermore, Surventis' revenue base is heavily concentrated in the automotive segment. Approximately 50% of revenue stems from the cyclical auto OEM sector, directly linking performance to global vehicle production and historically contributing to earnings volatility. Customer concentration is also significant, particularly within the automotive OEM division, with the five largest customers accounting for more than a fifth of total group revenue. This differentiates Surventis unfavorably from its peers and is only partially mitigated by customer diversification in the surface treatment and refinish divisions. Consequently, we assess Surventis as being at the lower end of our satisfactory business risk profile category." Surventis' future profitability hinges on successful execution of its cost-saving initiatives. Historically, S&P Global Ratings-adjusted EBITDA margins under BASF ownership averaged 12%-13% annually from 2019-2025, which was below peer levels. This was partly due to exceptional costs incurred at Surventis and corporate cost allocations from BASF. S&P said, "In 2026-2027, we expect leaner operations, reduced restructuring, and further efficiency measures to materially improve Surventis' cost base. This, combined with organic growth in higher-margin surface treatment and refinish segments, would drive adjusted margin expansion to 17.5%-19.5% over the next two years (from 12.8% in 2025). However, we acknowledge the risk of cost overruns or delays in implementing the planned savings, and believe Surventis has yet to demonstrate a sustained track record of profitability as an independent entity. This, coupled with the relative weaknesses in Surventis' business risk profile, leads us to apply a one-notch negative comparable ratings analysis." S&P said, "Our financial risk profile assessment reflects forecast high leverage and private equity ownership. The EUR4.55 billion senior secured debt issuance to finance the acquisition will result in adjusted debt to EBITDA of 6.3x-6.6x in 2026. We project leverage will decline to 5.5x-5.7x in 2027, driven by anticipated EBITDA growth and broadly stable debt levels. While deleveraging is contingent on Surventis' successful execution of planned savings initiatives, we note the shareholder's communicated commitment to reduce leverage in the coming years. Consequently, we do not forecast significant dividend distributions or debt-funded acquisitions, although we expect solid positive free operating cash flow (FOCF) over the next two years. This will bolster Surventis' ability to reduce leverage on a net basis." The group's direct exposure to the Middle East war is limited. Less than 0.5% of Surventis' sales originate from Gulf countries and it does not source any raw materials or energy from the region. In addition, energy costs represent less than 1% of the total cost base, resulting in a low direct impact from durably higher oil prices should the conflict persist. S&P said, "We also understand that the group is able to adopt measures, including sales price management, to limit the impact of higher costs on profitability. However, Surventis' reliance on the global automotive market leaves it vulnerable to demand headwinds that could intensify with a prolonged conflict, potentially hitting vehicle sales and production. S&P said, "We view Surventis' liquidity as adequate. A sufficient cash balance and a fully available EUR750 million revolving credit facility (RCF) will provide a substantial buffer for Surventis' liquidity needs, including capital expenditure (capex) and seasonal working capital outflows. Liquidity is also supported by recurring cash generation and lack of substantial near-term debt maturities. Our assessment is, however, capped by qualitative factors: we believe that in the event of any high-impact, low-probability occurrence, the group may require some level of refinancing. Besides, Surventis is yet to establish its standing on credit markets as a fully stand-alone business. "The ratings are in line with the preliminary ratings we assigned on April 27, 2026, following the close of the transaction and our review of the final documentation. "The stable outlook reflects our expectation that gradual EBITDA improvement from efficiency initiatives and organic business growth will lead to adjusted debt to EBITDA of about 6.3x-6.6x in 2026. It also assumes no further debt increases and adequate liquidity in the next 12 months. "We could lower the rating if Surventis' EBITDA weakened such that adjusted debt to EBITDA increased above 7.0x in the next 12 months and FOCF to debt approached 0%. This could occur because of cost overruns, delays in the implementation of Surventis' business plan or lower sales, for example due to a slowdown in global automotive sales. "We could also lower the rating if Surventis pursued a more aggressive financial policy; for example, undertaking a large debt-funded acquisition or shareholder remuneration." An upgrade is unlikely in the next 12 months, given Surventis' expected high leverage over this period. In the medium term, an upgrade would hinge on a sustained improvement in credit metrics, with debt to EBITDA close to 5.0x and FOCF to debt consistently above 5%, with shareholders' commitment to maintain the metrics at such levels. DUAL SEAL: Leonard Curtis Appointed as Joint Administrators ----------------------------------------------------------- Dual Seal Glass Ltd. (trading as Dualseal) was placed into administration in the High Court of Justice, Business and Property Courts in Leeds, Company and Insolvency List, Case Number CR-2026-LDS-000635. Sean Williams and Phil Deyes of Leonard Curtis were appointed as Joint Administrators on June 29, 2026. The company specilized in the manufacture of double glazing. Its registered office is currently 403 Leeds Road, Huddersfield, Yorkshire, HD2 1XU and will be changed to 51A St. Paul's Street, Leeds, West Yorkshire, LS1 2TE. Its principal trading address is 403 Leeds Road, Huddersfield, Yorkshire, HD2 1XU. The Joint Administrators can be contacted at: Sean Williams Phil Deyes Leonard Curtis 51A St. Paul’s Street Leeds West Yorkshire LS1 2TE Further details: The Joint Administrators Email: Creditors.Leeds@leonardcurtis.co.uk Tel: 0113 323 8890 Alternative contact: Amelia Blythe DYNAMIC FOOD: Springfields Advisory Appointed as Administrator -------------------------------------------------------------- Dynamic Food Ltd (trading as Pizza Hut) was placed into administration in the High Court of Justice, Business and Property Court of England and Wales, Court Number CR-2026-004437, and Situl Devji Raithatha of Springfields Advisory LLP was appointed as Administrator on June 26, 2026. The company specialized in fast food takeaways. Its registered office and principal trading address is 70 Horbury Road, Wakefield, WF2 8TU. The Administrator can be contacted at: Situl Devji Raithatha Springfields Advisory LLP 38 De Montfort Street Leicester LE1 7GS Further details, contact: Sachin Raithatha Tel: 0116 299 4745 Email: sachin.r@springfields-uk.com DYNAMIC PIZZA 3: Springfields Advisory Appointed as Administrator ----------------------------------------------------------------- Dynamic Pizza 3 Ltd (trading as Pizza Hut) was placed into administration in the High Court of Justice, Business and Property Courts in Leeds, Court Number CR2026LDS000682, and Situl Devji Raithatha of Springfields Advisory LLP was appointed as Administrator on June 26, 2026. The company specialized in fast food takeaways. Its registered office is at 57 Magnolia Road, Leeds, LS14 6WQ. The principal trading address is 221A Hinckley Road, Leicester, LE3 0TG. The Administrator can be contacted at: Situl Devji Raithatha Springfields Advisory LLP 38 De Montfort Street Leicester LE1 7GS Further details, contact: Sachin Raithatha Tel: 0116 299 4745 Email: sachin.r@springfields-uk.com DYNAMIC PIZZA LIMITED: Springfields Tapped as Administrator ----------------------------------------------------------- Dynamic Pizza Limited (trading as Pizza Hut) was placed into administration in the High Court of Justice, Business and Property Courts in Leeds, Court Number CR2026LDS000683, and Situl Devji Raithatha of Springfields Advisory LLP was appointed as Administrator on June 26, 2026. The company specialized in fast food takeaways. Its registered office is 57 Magnolia Road, Seacroft, Leeds, LS14 6WQ. The principal trading address is 37 Aldergate, Tamworth, B79 7DD. The Administrator can be contacted at: Situl Devji Raithatha Springfields Advisory LLP 38 De Montfort Street Leicester LE1 7GS Further details, contact: Sachin Raithatha Tel: 0116 299 4745 Email: sachin.r@springfields-uk.com EFFECTIVE HOME: Jeremy Knight Appointed as Joint Administrators --------------------------------------------------------------- Effective Home Ltd was placed into administration in the High Court of Justice, No 005043 of 2026, and Simon Peter Edward Knight and Syed Oowas Farhan Aziz of Jeremy Knight & Co. were appointed as Joint Administrators on June 26, 2026. The company specialized in supplying and fitting solar panels and solar photovoltaic products. Its registered office is at 1 Boston Road, Leicester, LE4 1AA. Its principal trading address is Unit 3, Crompton Business Park, Crompton Road, Doncaster, DN2 4PA. The Joint Administrators can be contacted at: Simon Peter Edward Knight Syed Oowas Farhan Aziz Jeremy Knight & Co. 68 Ship Street Brighton East Sussex BN1 1AE Further details, contact: Violetta Korbina Tel: 01273 203654 Email: vkorbina@jeremyknight.co.uk HEALTH DISPENSARY: BTG Begbies Appointed as Administrators ---------------------------------------------------------- The Health Dispensary Ltd was placed into administration in the High Court of Justice, Business and Property Courts in Birmingham, Insolvency & Companies List (ChD), Court Number CR-2026-BHM-000328, and Chris Latos and Tom D'Arcy of BTG Begbies Traynor (Central) LLP were appointed as administrators on July 1, 2026. The company offered dispensing chemist services in specialist stores. Its registered office is at 153 Windsor Road, Neath, Neath Port Talbot, SA11 1NU. Its principal trading addresses are 153 Windsor Road, Neath, Neath Port Talbot, SA11 1NU and 32 Orchard Street, Neath, Castell-Nedd, Port Talbot, SA11 1HA. The Joint Administrators can be contacted at: Chris Latos Tom D'Arcy BTG Begbies Traynor (Central) LLP 26 Stroudley Road Brighton East Sussex BN1 4BH For further details, contact: Jonathan Eames BTG Begbies Traynor (Central) LLP Tel: 01273 322960 Email: jonathan.eames@btguk.com HORIZON LEGAL: RSM Appointed as Joint Administrators ---------------------------------------------------- Horizon Legal Limited was placed into administration in the High Court of Justice, Business and Property Courts of England and Wales, Insolvency & Companies List (ChD), Court Number CR-2026-005225, and Damian Webb and Joe Barry of RSM UK Restructuring Advisory LLP were appointed as Joint Administrators on July 2, 2026. The company specialized in litigation funding. Its registered office and principal trading address is 5 Gelliwasted Road, Pontypridd, CF37 2BP. The Joint Administrators can be contacted at: Damian Webb RSM UK Restructuring Advisory LLP 25 Farringdon Street London EC4A 4AB Tel: 020 3201 8000 -- and -- Joe Barry RSM UK Restructuring Advisory LLP 10th Floor 103 Colmore Row Birmingham B3 3AG Tel: 0121 214 3100 Case Manager: Joshua Varughese RSM UK Restructuring Advisory LLP 25 Farringdon Street, London, EC4A 4AB Tel: 020 3201 8000 MORGLAS ABS 2026-1: S&P Assigns B- (sf) Rating to Cl. X-Dfrd Notes ------------------------------------------------------------------ S&P Global Ratings assigned credit ratings to Morglas ABS 2026-1 PLC's class A, B-Dfrd, C-Dfrd, D-Dfrd, E-Dfrd, F-Dfrd, and X-Dfrd notes. At closing, the issuer also issued unrated class Z-Dfrd, R-Dfrd, and Y certificates. This is the second public securitization of a portfolio of unsecured consumer loans originated and serviced by Admiral in the U.K. It will amortize from the first interest payment date, and the issuer used the proceeds of the notes to purchase a portfolio of unsecured consumer loans, to fund the liquidity reserve and to pay certain issuer expenses and fees. Collections are distributed monthly according to a split waterfall, separate for interest and principal collections. Principal payments will initially be pro rata until a sequential amortization event occurs. The class A and B-Dfrd notes benefit from an amortizing liquidity reserve, sized at 1.25% of their principal closing balances. It will amortize in line with the outstanding balance on these notes, subject to a minimum amount of GBP500,000. This reserve is available to cover interest shortfalls on the class A and B-Dfrd notes as well as senior items in the revenue waterfall. The excess of the reserve fund above its required amount following the amortization of its balance to its required level will be released in the interest priority of payments and may be used to cure the principal deficiency ledgers. The reserve's balance will be zero after the class A and class B-Dfrd notes fully redeem, with the excess being released in the interest waterfall. A combination of note subordination, excess spread, and the excess of the liquidity reserve above its required amount provides credit enhancement for the rated notes. The rated notes pay a daily compounded Sterling Overnight Index Average (SONIA) rate plus a margin subject to a floor of zero, while the assets pay a monthly fixed interest rate. An interest rate swap mitigates fixed-floating interest rate risk, with a predetermined notional amount based on a 20% prepayment rate. Barclays Bank PLC is the interest rate swap provider. Except for the class A notes, interest due on all classes of notes is deferrable under the transaction documents. Nonpayment of interest on the mezzanine and junior notes does not constitute an event of default. If a class becomes the most senior, current interest is due on a timely basis, while any outstanding deferred interest is due immediately once this tranche becomes the most senior or on the maturity date. Considering the collections' frequency, payments are expected to be remitted to the transaction account within two business days of receipt, therefore, S&P considers commingling risk to be mitigated. The transaction structure also incorporates a declaration of trust over Admiral's collection account as an additional layer of protection. Admiral is not a deposit-taking institution, and no insurance is attached to the loans, however Admiral's employees are not explicitly excluded from the securitized portfolio. While Admiral states this scenario is unlikely (less than one per 1,000 loans), it cannot definitively exclude these loans from the pool. Admiral does not specifically target its employees with their unsecured loan product, nor does it offer preferential terms--employees must meet the same underwriting criteria as any other applicant. Our analysis considered the transaction's minimal exposure to potential employee setoff risk. Admiral is the initial servicer of the loans. Lenvi Servicing Ltd.--as standby servicer--is expected to be operational within 30 days of a termination event. The ratings are not constrained by counterparty, operational, or sovereign risks. S&P considers the issuer to be bankruptcy remote. Ratings Class Rating* Amount (mil. GBP) A AAA (sf) 249.329 B-Dfrd AA (sf) 21.923 C-Dfrd A (sf) 17.600 D-Dfrd BBB (sf) 8.337 E-Dfrd BB (sf) 6.886 F-Dfrd B (sf) 2.686 Z-Dfrd NR 2.007 R-Dfrd§ NR 3.391 X-Dfrd§ B- (sf) 10.035 Y certs NR N/A *S&P said, "Our rating on the class A notes addresses timely payment of interest and ultimate repayment of principal. Our ratings on the class B-Dfrd, C-Dfrd, D-Dfrd, E-Dfrd, F-Dfrd, and X-Dfrd notes address the ultimate repayment of both interest and principal, and consider the timely payment of interest, including any previously deferred amounts, once the class is the most senior." §The class R-Dfrd, and X-Dfrd notes are not asset-backed. Their proceeds will fund the reserve accounts and pay any issuance expenses and fees Dfrd--Deferrable. NR--Not rated. N/A--Not applicable. OCEANIUM LTD: Azets Appointed as Joint Liquidators -------------------------------------------------- Oceanium Ltd was placed into liquidation in the Court of Session, No P358 of 2026, and James Fennessey and Blair Milne of Azets Holding Limited were appointed as Joint Liquidators on March 27, 2026. The company specialized in the manufacture of other food products not elsewhere classified. Its registered office and principal trading address is Malin House, Suite 10, The European Marine Science Park, Dunbeg, Oban, PA37 1SZ. The Joint Liquidators can be contacted at: James Fennessey Blair Milne Azets Holding Limited Titanium 1 King's Inch Place Renfrew PA4 8WF Further details: The Joint Liquidators Tel: 0141 886 6644 Alternative Contact: Martin McGrellis Email: martin.mcgrellis@azets.co.uk RAINBOW UK: Moody's Upgrades CFR to B1, Outlook Remains Stable -------------------------------------------------------------- Moody's Ratings has upgraded Rainbow UK MidCo 2 Ltd's (Wella Company) long-term corporate family rating to B1 from B2 and its probability of default rating to B1-PD from B2-PD. Concurrently, Moody's have upgraded all the senior secured instrument ratings issued by Rainbow Finco S.a r.l. and Wella US Operations LLC to B1 from B2. The outlooks on all the entities remain stable. RATINGS RATIONALE The upgrade reflects Wella Company's solid operating results, including sustained revenue growth and improved profitability, which led to strengthened credit metrics. The company has also built a track record of standalone operations since the spinoff from Coty Inc. (Coty, Ba1 negative) in 2020. Wella Company has significantly accelerated growth across most business segments in financial year 2026 (ends June 30, 2026) as a result of its strategic focus on expanding the hair segments and a strong pipeline of new products in the beauty tech segment, further supported by favourable currency movements. Moody's expects the company's net revenue to increase by 9% in financial 2026, broadly in line with the 10.3% growth (5.6% on a constant currency basis) achieved in the first nine months of the financial year and significantly above the 4%-5% growth in financial 2024-25. In financial 2027, Moody's projects this growth pace to moderate towards 4% but to continue to outpace the market, assuming no significant currency movements. The company's Moody's-adjusted EBITDA margin has almost doubled since the spinoff, reaching 17.1% in the 12 months ended March 31, 2026. Wella Company's profitability has historically benefitted from a significant portion of largely fixed selling, general and administrative costs amid growing net revenue, as well as and from fading one-off costs that Moody's views as recurring. However, its significantly increased marketing spending will constrain Moody's-adjusted EBITDA at around 17% in the next 12-18 months, despite the upward revenue trajectory. As a result of strong performance, Wella Company's debt/EBITDA reduced to 5.0x as of March 31, 2026 from 10.0x as of the end of financial 2022, while its Moody's-adjusted EBITA/interest expense exceeded 2.0x. Under Moody's baseline scenario, which assumes that financial benefits from the ongoing cost-saving programme and price increases will protect margins from higher input costs caused by the Middle East conflict, leverage will decline to 4.8x by the end of financial 2027. Moody's also expects Moody's-adjusted free cash flow (FCF)/debt to be around 5% in financial 2026-27. Assuming that elevated commodity prices put Wella Company's profitability under pressure similar to that in financial 2022-23, leverage will increase moderately to 5.4x by the end of financial 2027 before returning to levels commensurate with a B1 rating. Wella Company's B1 CFR reflects its (1) strong portfolio of brands and leading market positions across all major segments; (2) good geographical diversification, with some exposure to positive demographic fundamentals in emerging markets; (3) track record of profitable organic growth despite a weak macroeconomic environment and high inflation; and (4) robust liquidity underpinned by positive Moody's-adjusted FCF. The rating also factors in (1) the company's concentrated product offering in a few segments of the beauty market; (2) the intense competition in its core markets where Wella Company faces larger firms with greater marketing and innovation capacity; (3) its exposure to currency rate volatility because of global operations and debt primarily denominated in euros and UK pounds; and (4) relatively high, although significantly improved, Moody's-adjusted leverage of 5.0x as of March 31, 2026. LIQUIDITY Wella Company maintains good liquidity. As of March 31, 2026, its liquidity comprised unrestricted cash and equivalents of $132 million, a $347.5 million undrawn committed revolving credit facility (RCF) and operating cash flow of around $165 million including lease payments, which Moody's expects Wella Company to generate over the next 12 months. Moody's estimates this liquidity will be sufficient to comfortably cover capital spending of $73.4 million and seasonal working capital swings. The company has no debt maturities until February 2029. The RCF is subject to a springing net senior secured leverage covenant, which activates at 40% utilisation. Moody's do not expect this covenant to be tested over the next 12 months. STRUCTURAL CONSIDERATIONS Wella Company's B1-PD PDR is at the same level as its B1 CFR, reflecting the expected recovery rate of 50%, which Moody's typically assume for a capital structure consisting mainly of covenant-lite bank loans. The term loan B and the RCF are ranked pari passu in the senior secured debt capital structure. Their B1 ratings are aligned with the company's CFR. The facilities are guaranteed by material subsidiaries representing 80% or more of consolidated EBITDA, excluding EBITDA of any entity that is not required to provide guarantee. The security package includes material assets of obligors incorporated in England and Wales, and the US (New York or Delaware). For other obligors, the security package consists of pledges over shares, bank accounts and intercompany receivables. RATING OUTLOOK The stable outlook reflects Moody's expectations that Wella Company will continue to improve its credit metrics over the next 12-18 months while refraining from debt-financed shareholder distributions and acquisitions. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS Moody's could upgrade Wella Company's rating if it reduces debt/EBITDA towards 4.0x and improves FCF/debt to high-single-digit percentages on a sustainable basis (all metrics are Moody's-adjusted). An upgrade would also require the company to build a track record of adhering to a prudent financial policy and to maintain at least good liquidity. Moody's could downgrade Wella Company's rating if its debt/EBITDA exceeds 5.0x, EBITA/interest expense declines below 2.0x and FCF/debt weakens to low-single-digit percentages on a sustained basis (all metrics are Moody's-adjusted). Moody's could also downgrade the rating if liquidity deteriorates significantly. PRINCIPAL METHODOLOGY The principal methodology used in these ratings was Consumer Packaged Goods published in February 2026. The net effect of any adjustments applied to rating factor scores or scorecard outputs under the primary methodology(ies), if any, was not material to the ratings addressed in this announcement. COMPANY PROFILE Wella Company manufactures and sells hair and nail products, along with beauty tech tools, for professional and consumer use through an extensive network of salons, distributors, wholesalers and retailers, complemented by e-commerce. It operates three factories located in Germany (Aaa stable), Mexico (Baa3 stable) and Thailand (Baa1 stable), and outsources a portion of production to third parties. The company is owned by KKR following a spinoff from Coty in December 2020, and is headquartered in Switzerland (Aaa stable). In the 12 months that ended March 31, 2026, Wella Company generated $2.9 billion in net revenue and $494 million in Moody's-adjusted EBITDA. STONEGATE PUB: Fitch Affirms 'CCC+' Long-Term IDR ------------------------------------------------- Fitch Ratings has affirmed Stonegate Pub Company Limited's Long-Term Issuer Default Rating (IDR) at 'CCC+' and Stonegate Pub Company Financing 2019 Plc's senior secured debt rating at 'B' with a Recovery Rating of 'RR2'. The rating reflects high EBITDAR leverage and weak coverage. Fitch expects some improvement in metrics ahead of the refinancing of its debt that matures in 2029 from conversions and disposals of loss-making pubs. Fitch estimates the company will maintain sufficient but shrinking liquidity as disposals and a partially undrawn revolving credit facility support capex. The rating captures Stonegate group excluding the Platinum portfolio of just over 1,000 leased and tenanted (L&T) pubs placed under the securitisation completed in 2024, generating around GBP83 million EBITDA that Fitch deconsolidates from the group's earnings. Key Rating Drivers Positive Earnings Momentum: Fitch has broadly maintained its forecast for the restricted group and expects EBITDA (post rents) to exceed GBP300 million in FY27 (financial year ending September). Stonegate reported 9.2% like-for-like earnings growth at pub level (post rents) in 1HFY26. Fitch expects growth in earnings per pub for all three formats due to capex investments, conversions of underperforming managed pubs to other formats and disposals of loss-making pubs. However, overall EBITDA will be negatively affected by disposals of profitable pubs. Managed Estate Shrinking: Stonegate has roughly halved its managed pub estate since FY23 to 434 sites and plans to shrink it to 320 sites by the end of FY26. There is potential for this to reduce further in FY27. This change in strategy was implemented as managed pubs underperformed due to operational cost challenges. So far, it has reported good results from conversions, with 119 managed pubs converted to other formats in 1HFY26. There is execution risk on the remaining conversions from managed to other formats or disposals over the next 18 months. Underperforming Managed Estate: The underperformance of the managed estate has moderated with 4.6% decline in like-for-like profits in 1HFY26 compared with a near 19% decline in 1HFY25. The negative like-for-like sales (-2.5% in 1HFY25) for the managed estate suggest that price increases are not fully offsetting volume decline. The performance of the weakest segment, late night bars, is also due to more structural changes, but Fitch believes the performance at pubs continues to be affected by strong competition from the likes of JD Wetherspoon, which operates nearly 800 managed pubs and reports about 4% like-for-like sales growth and some pressure on profit per pub. More Stable L&T Portfolio: The L&T portfolio, which constitutes around 75% of the estate, is generally more stable due to income from rents and drinks sales, with no exposure to labour cost inflation. It reported 6.6% site-level EBITDA growth in 1HFY26 and conversions from managed pubs are generating a healthy rise in profits. High Leverage: Fitch anticipates EBITDAR leverage will gradually reduce to below 8.5x from 9.0x at FYE25. This incorporates some growth in earnings and slight reduction in debt, as the Unique N-notes will start amortising at end-FY27. Weak Coverage: Fitch estimates fixed charge coverage will remain weak at on average 1.2x over FY26-FY29, mildly benefiting from the exit of underperforming leased pubs. Fitch expects slightly negative free cash flow (FCF) after disposals, which are subject to execution risk. Capex will reduce as conversions complete and Fitch models it at around GBP90 million for the restricted group. Restricted Group Excludes Platinum: Fitch deconsolidates the Platinum portfolio of just over 1,000 non-core L&T pubs placed under the new non-recourse securitisation funding in 2024. Fitch expects its earnings to grow in low single digits from GBP83 million EBITDA in FY25, which Fitch deconsolidates from the group's forecast earnings. Fitch does not expect post-debt service operating cash flows from the Platinum securitisation put in place in 2024 to be upstreamed to Stonegate. Group reports include the Platinum portfolio and earnings. Largest Pub Group: Stonegate (rated perimeter) is the largest pub group in the UK with about 3,200 pubs (excluding about 1,000 in the Platinum group). Its size allows it to secure discounts with suppliers (brewers, SKY TV, etc). The portfolio is split between L&T pubs (75%), managed pubs (10%) and operator-led pubs (15%). Stonegate pubs are mainly wet-led with only about 7% of turnover from food. Peer Analysis Stonegate's portfolio of 4,172 pubs (at April 2026) is significantly larger than Punch Pubs Group Limited's (B-/ Positive) 1,300 pubs, with both groups predominantly wet-led. Stonegate's scale enables central procurement discounts, which combined with larger average pub size, has driven higher profits per pub. However, this gap has narrowed, largely due to the underperformance of Stonegate's managed estate, where Punch has no exposure. Punch's one-notch higher rating reflects its around 1.5x lower EBITDAR leverage, trending down to below 7.0x by FYE27, and stronger coverage of around 1.7x compared with 1.15x for Stonegate. Stonegate is equally geographically diverse across the UK but has core-city and late-night formats that have been affected by reduced high street and late-night patronage. This has been compounded by rising labour and energy costs in its managed estate, which has driven a sharp decline in profits. Stonegate is now reducing its exposure to the managed format, moving back towards L&T operations, which are less exposed to operating cost pressures, but have lower profits. Stonegate's rating is aligned with UK-weighted Pizza Express (Wheel Bidco Limited, CCC+), both of which are affected by reduced customer volumes and significant cost inflation, driving uncertainty over the pace of EBITDA recovery. Stonegate, and pub groups generally, have higher debt capacity than Pizza Express due to their larger size and better financial and operational flexibility, given their freehold property, more limited exposure to labour costs and greater resilience to operating conditions. Fitch's Key Rating-Case Assumptions Increasing trading EBITDA (pre-central costs) in FY26 with profit growth in L&T and operator-led offset by reduction in the managed estate due to effective conversion strategy and disposals L&T EBITDA/pub (post rents, but before central costs) increasing to about GBP100,000 by FY29 from GBP83,000 in FY25 with the portfolio declining from just over 3,000 sites (including Platinum) to about 2,850 sites in FY29 mainly due to disposals, which will be partly offset by conversions from managed pubs. This includes Platinum sites reducing to 980 by FY29 from 1,010 Managed EBITDA/pub (post rents) increasing to GBP285,000 in FY26 from GBP201,000 in FY25 and improving to around GBP400,000 in FY28 on the back of a smaller, more profitable portfolio of about 200 sites Operator-led EBITDA/pub (post rents) growing to GBP200,000 in FY29 from GBP158,000 in FY25, portfolio slightly increasing to about 660 sites Group central costs (including Platinum, excluding exceptionals) of GBP110 million in FY26, reducing to GBP100 million in FY27 and GBP90 million in FY28 thanks to cost reduction actions and smaller managed pub portfolio, before gradually increasing in FY29. Deconsolidation of Platinum EBITDA, which Fitch assumes to grow from GBP83 million in FY25 by on average 2.5% per year. Freehold pub disposals (excluding Platinum) of around GBP85 million in FY26, about GBP70 million in FY27 from disposing about 130 and 110 sites a year respectively, subsequently reducing to GBP40 million in FY28 from about 60 sites. Disposals of 150 loss-making leasehold pubs, removing GBP14 million rental costs in FY27 at GBP35 million exceptional cost (reverse premiums). Capex (excluding Platinum) totals about GBP110 million in FY26 reducing to near GBP90 million in FY28 as conversions completed. Fitch models limited 10 sites conversion from L&T to operator-led from FY28 Broadly neutral working capital No external dividends Corporate Rating Tool Inputs and Scores Fitch scored the issuer as follows, using its Corporate Rating Tool (CRT) to produce the Standalone Credit Profile (SCP): Business and financial profile factors (assessment, relative importance): management ('b', Moderate), sector characteristics ('bb-', Moderate), market and competitive positioning ('bb+', Moderate), diversification and asset quality ('bb', Moderate), company operational characteristics ('bb', Lower), profitability ('b', Moderate), financial structure ('ccc-', Higher), and financial flexibility ('b-', Higher). The quantitative financial subfactors are based on standard CRT financial period parameters: 20% weight for the latest historical year FY25, 40% for the forecast year FY26 and 40% for the forecast year FY27. B+ to CC considerations apply in its analysis and has no impact. The governance assessment of 'some deficiencies' has no impact. The operating environment assessment of 'aa-' has no impact. The SCP is 'ccc+'. To derive the Long-Term IDR: Fitch made no adjustments to the SCP, resulting in an IDR of 'CCC+'. Recovery Analysis Fitch's recovery analysis assumes that Stonegate would be liquidated rather than restructured as a going concern in a default. Recoveries are based on the property values of the consolidated group's pub assets, although bondholders' security is a pledge over the equity shares in group entities. Its liquidation approach uses FYE25 valuations of the group's freehold and long leasehold assets, and Fitch adjusts for disposals made in 1HFY26. Fitch applies a 25% discount to these pub valuations, comparable with the 25% stress experienced by industry peers during 2007 to 2011, on an EBITDA/pub basis, replicating the 'fair maintainable trade' component of pub valuations. Fitch has excluded the Platinum pub assets as they have their own Apollo non-restricted group secured financing. Unique's securitisation is under-leveraged. Stonegate has significant incentives to retain Unique's residual value after deducting its secured debt of about GBP165 million and fully drawn debt service facility of GBP12 million. Including the discount on the real estate, the amount Fitch assumes available to Stonegate creditors is around GBP1.15 billion, plus GBP1.1 billion from the attributable residual values primarily from Unique. After deducting a standard 10% for administrative claims, Fitch has assumed that Stonegate's super-senior revolving credit facility and overdraft totaling GBP273 million would be fully drawn in a default. Fitch assumes the senior secured first-lien notes of around GBP2.1 billion rank behind the revolving credit facility but ahead of second-lien payment in kind debt of GBP185 million. Fitch's principal waterfall analysis generates a ranked recovery for senior secured first-lien notes of 'RR2', indicating a two-notch uplift for this class of instrument above the IDR. RATING SENSITIVITIES Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade - Weaker-than expected operating performance due to macro-economic environment affecting consumer behaviours, competitive pressures or execution risks leading to inability to improve earnings or consistently negative FCF (after disposals) - Deterioration in expected available liquidity, leading to heightened refinancing risks - EBITDAR fixed-charge coverage below 1.0x - Leverage not trending towards 8.5x Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade - Stronger than forecast performance with EBITDA reaching GBP350 million - EBITDAR leverage below 8.0x - EBITDAR fixed-charge coverage above 1.3x - FCF trending to neutral - Adequate liquidity that is not diminishing Liquidity and Debt Structure Stonegate reported GBP117 million cash at mid-April 2026. Of this, GBP63 million relates to the restricted group, which combined with GBP80 million available under the committed, undrawn revolving credit facility (GBP248 million limit) provides satisfactory available liquidity of GBP143 million. Fitch expects negative FCF, partly due to around an average of GBP100 million capex to be partly offset by disposals (about GBP80 million on average), and for the overall liquidity position to decline in the first two years. Stonegate does not have debt maturities before 2029. Issuer Profile Stonegate is a private equity (TDR) owned, largest UK pub group with a total of about 3,200 pubs in the restricted group spread across three different business models. MACROECONOMIC ASSUMPTIONS AND SECTOR FORECASTS Fitch's latest quarterly Global Corporates Sector Forecasts Monitor data file which aggregates key data points used in its credit analysis. Fitch's macroeconomic forecasts, commodity price assumptions, default rate forecasts, sector key performance indicators and sector-level forecasts are among the data items included. Climate Vulnerability Signals The results of its Climate.VS screener did not indicate an elevated risk for Stonegate. ESG Considerations The highest level of ESG credit relevance is a score of '3', unless otherwise disclosed in this section. A score of '3' means ESG issues are credit-neutral or have only a minimal credit impact on the entity, either due to their nature or the way in which they are being managed by the entity. Fitch's ESG Relevance Scores are not inputs in the rating process; they are an observation on the relevance and materiality of ESG factors in the rating decision. Entity/Debt Rating Recovery Prior ----------- ------ -------- ----- Stonegate Pub Company Financing 2019 Plc senior secured LT B Affirmed RR2 B Stonegate Pub Company Limited LT IDR CCC+ Affirmed CCC+ ZEAL GLOBAL: Opus Restructuring Appointed as Joint Administrators ----------------------------------------------------------------- Zeal Global Maritime Solutions Ltd was placed into administration in the High Court of Justice, Business and Property Courts in Birmingham, No 000338 of 2026, and Louise Williams and Luke Brough of Opus Restructuring LLP were appointed as Joint Administrators on July 3, 2026. The company specialized in private security activities. Its registered office is at White House, Wollaton Street, Nottingham, NG1 5GF. Its principal trading address is Hexgreave Hall, Farnsfield, Newark, NG22 8LS. The Joint Administrators can be contacted at: Louise Williams Luke Brough Opus Restructuring LLP Bridgford Business Centre 29 Bridgford Road West Bridgford Nottingham NG2 6AU Further details, contact: Cameron Nicol Tel: 0115 666 8230 Email: Nottingham@Opusllp.com ********* 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 2026. All rights reserved. ISSN 1529-2754. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. The TCR Europe subscription rate is US$775 per half-year, delivered via e-mail. Additional e-mail subscriptions for members of the same firm for the term of the initial subscription or balance thereof are US$25 each. For subscription information, contact Peter Chapman at 215-945-7000. * * * End of Transmission * * *