Fitch cuts New Look, rates notes CCC

Fitch Ratings said it assigned New Look Bonds Ltd. a long-term issuer default rating of CCC+.

Fitch also rated the financing vehicle New Look Financing plc's £250 million reinstated senior secured May 2024 notes and £150 million new money May 2024 bonds at CCC/RR5/21%.

New Look Bonds is a newly incorporated intermediate holding company, indirect subsidiary of New Look Retail Holdings Ltd., and is the successor rated entity of New Look Retail Group following the completed debt restructuring.

Fitch also downgraded New Look Retail Group Ltd.'s long-term issuer default rating to restricted default (RD) from C and withdrew the rating.

In addition, Fitch downgraded to RD and then withdrew the instrument ratings on New Look Secured Issuer plc's 2022 senior secured notes and New Look Issuer plc's senior notes.

The agency said the completion of the financial restructuring represents a restricted default under Fitch's distressed debt exchange criteria.

“The CCC+ issuer default rating reflects high execution risk in the company's back-to-basics turnaround strategy, returning to broad appeal product, in an extremely competitive mass market clothing sector characterised by the increasing presence of pure online retailers, Brexit uncertainty and rising input prices, while maintaining high leverage,” the agency said in a news release.

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