S&P affirms Sisal Group

S&P said it affirmed its B+ long-term issuer credit rating on Sisal Group SpA and withdrew the B+ rating on the parent company Schumann SpA, following its merger into the Sisal group. The outlook is negative.

At the same time, the agency affirmed the B+ issue rating on the €725 million senior secured notes. The recovery rating is unchanged at 3, indicating an expectation of meaningful recovery (50%-70%; rounded estimate: 65%) in the event of a payment default.

In addition, S&P affirmed the BB- issue rating on the €125 million super senior revolving credit facility. The recovery rating is unchanged at 2, indicating substantial recovery (70%-90%; rounded estimate: 85%).

Sisal Group's concession for the operation and development of national tote number games, including SuperEnalotto, expires in June.

“Should the license not be renewed, we understand the company would use the capital required for the license for other purposes, such as mergers or acquisitions,” S&P said in a news release.

“However, in the absence of a specific alternative, we consider that Sisal's profitability and credit metrics could materially deteriorate, resulting in a leverage ratio above 5x.”

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