Fitch: Towergate view negative

Fitch Ratings said it affirmed Towergate Finance plc's long-term issuer default rating at B, its £210 million senior secured term loan B and £230 million senior secured notes due 2018 at BB/RR1 and its £290 million senior notes due 2019 at B-/RR5 and revised the outlook to negative from stable.

The outlook revision reflects Towergate's underperformance in the first nine months of 2011 against the agency's expectations in terms of income and EBITDA (7% and 11% below, respectively) and the subsequent lack of deleveraging, Fitch said. The agency attributed the underperformance to a more challenging and competitive environment than expected.

Nonetheless, the agency said the issuer default rating continues to be supported by Towergate's leading position as a non-life insurance intermediary in the United Kingdom, its wide product distribution platform and expertise in niche SME commercial and personal insurance lines.

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