Moody's downgrades New Look

Moody's Investors Service said it downgraded the rating on the £700 million fixed-rate notes and €415 million floating-rate senior secured notes due 2022 issued by New Look Secured Issuer plc to C from Caa3.

The current Ca corporate family rating and Ca-PD probability of default rating on New Look Retail Group Ltd., along with the C rating on the £200 million backed unsecured notes due 2023 issued by New Look Senior Issuer plc, are unchanged, the agency said.

The outlook remains negative, reflecting the continued uncertainty on the final capital structure and the execution risk on the restructuring plan, Moody's said.

The downgrades reflect the refinancing's proximity to a distressed exchange, which constitutes a default under the agency's methodologies, Moody's explained.

The downgrades also consider the higher-than-expected losses for financial creditors if the company's proposed debt restructuring plan is successfully implemented, the agency added.

The company recently announced that it reached an agreement with a group of senior secured noteholders on an envisaged debt-restructuring plan, Moody's said.

The existing revolving credit and operating facilities would be reinstated at par and their priority ranking would not be affected by the transaction, the agency noted.

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