Fitch revises Eurotorg’s Outlook to Negative, Affirms at 'B'
<p> MINSK, Nov 19 - PrimePress. Fitch Ratings says it has revised the Outlook on LLC Eurotorg’s Long-Term Foreign-Currency (FC) Issuer Default Rating (IDR) to Negative from Stable and affirmed the IDR at 'B'. </p> <p> </p> <p> The revision of the Outlook to Negative follows the revision of the Outlook on Belarus's sovereign rating and reflects the risk of a downgrade of Belarus's Country Ceiling below 'B', which would constrain Eurotorg's rating. </p> <p> </p> <p> The Negative Outlook on Eurotorg's FC IDR is aligned with the Outlook on Belarus's sovereign rating and reflects risks of a downgrade of Belarus's Country Ceiling below 'B'. This would constrain Eurotorg's rating as the group does not have export earnings and foreign assets and financial support from foreign parent or strategic partners, which may allow the rating to pierce the applicable Country Ceiling. </p> <p> </p> <p> Eurotorg's 'B' IDR continues to reflect the group's small scale, limited diversification outside its domestic market and high FX risks, which weigh on its financial flexibility relative to international rated peers. These weaknesses are balanced by its conservative capital structure and a strong position in Belarus's food retail market. </p> <p> </p> <p> “We assume that political protests in Belarus, which started in August 2020, will not cause any material disruption to Eurotorg's operations, although increasing risks for macroeconomic stability may weaken consumer sentiment in the country.” </p> <p> </p> <p> Eurotorg’s ratings also take into consideration higher-than-average systemic risks associated with the Belarusian business and jurisdictional environment. </p> <p> </p> <p> As previously reported in October 2020, Fitch Ratings assigned LLC Eurotorg’s loan participation notes (LPNs) worth $300 million a final rating of 'B'/'RR4' following their placement and completion of tender offer for the existing LPNs. </p> <p> </p> <p> The LPNs are issued by Bonitron Designated Activity Company, an SPV domiciled in Ireland. The SPV is limited to issuing the notes and providing a loan to Eurotorg. The notes are secured by a loan to Eurotorg, which ranks equally with its other senior unsecured obligations. </p> <p> </p> <p> Eurotorg has been operating since 1993, the first shop under the brand name Euroopt was opened in 1997. Eurotorg’s self-estimated share in the retail market of Belarus stands at 19%. End </p>
2020-11-20
Primepress
Fitch revises Eurotorg’s Outlook to Negative, Affirms at 'B'
MINSK, Nov 19 - PrimePress. Fitch Ratings says it has revised the Outlook on LLC Eurotorg’s Long-Term Foreign-Currency (FC) Issuer Default Rating (IDR) to Negative from Stable and affirmed the IDR at 'B'.
The revision of the Outlook to Negative follows the revision of the Outlook on Belarus's sovereign rating and reflects the risk of a downgrade of Belarus's Country Ceiling below 'B', which would constrain Eurotorg's rating.
The Negative Outlook on Eurotorg's FC IDR is aligned with the Outlook on Belarus's sovereign rating and reflects risks of a downgrade of Belarus's Country Ceiling below 'B'. This would constrain Eurotorg's rating as the group does not have export earnings and foreign assets and financial support from foreign parent or strategic partners, which may allow the rating to pierce the applicable Country Ceiling.
Eurotorg's 'B' IDR continues to reflect the group's small scale, limited diversification outside its domestic market and high FX risks, which weigh on its financial flexibility relative to international rated peers. These weaknesses are balanced by its conservative capital structure and a strong position in Belarus's food retail market.
“We assume that political protests in Belarus, which started in August 2020, will not cause any material disruption to Eurotorg's operations, although increasing risks for macroeconomic stability may weaken consumer sentiment in the country.”
Eurotorg’s ratings also take into consideration higher-than-average systemic risks associated with the Belarusian business and jurisdictional environment.
As previously reported in October 2020, Fitch Ratings assigned LLC Eurotorg’s loan participation notes (LPNs) worth $300 million a final rating of 'B'/'RR4' following their placement and completion of tender offer for the existing LPNs.
The LPNs are issued by Bonitron Designated Activity Company, an SPV domiciled in Ireland. The SPV is limited to issuing the notes and providing a loan to Eurotorg. The notes are secured by a loan to Eurotorg, which ranks equally with its other senior unsecured obligations.
Eurotorg has been operating since 1993, the first shop under the brand name Euroopt was opened in 1997. Eurotorg’s self-estimated share in the retail market of Belarus stands at 19%. End