Fitch rates Sherwood Parentco, notes BB-

Fitch Ratings said it assigned Sherwood Parentco Ltd. (Arrow) a long-term issuer default rating of BB- and expected BB- long-term ratings to senior secured debt to be issued by Sherwood Financing plc and guaranteed by Arrow (among other Sherwood entities).

Arrow is the parent company of Sherwood Acquisitions Ltd., to acquire Arrow Global Group plc. As the top holding company producing consolidated accounts within a restricted banking group, Fitch said it assigned the long-term IDR at the level of Arrow rather than at the level of Sherwood Acquisition Limited.

The acquisition, valuing Arrow Global Group plc's ordinary share capital at £565 million, was completed on Oct. 12. As part of the acquisition, Sherwood Acquisitions set up €975 million and £400 million one-year extendable senior secured bridge facilities which it intends to refinance through the issue of around £1.2 billion-equivalent in euro fixed- and floating-rate and sterling fixed- rate senior secured notes.

“Fitch expects Arrow's outstanding gross debt to remain broadly unchanged following the planned debt issue and cash flow leverage as of end-2021 to improve to around 5x, largely as a result of improving cash EBITDA on the back of resilient collections and improving revenue in the fund-management and servicing segments,” the agency said in a press release.

The outlook is stable.

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