Moody's downgrades VFS to B2

Moody's Investors Service said it downgraded Kiwi VFS SUB I Sarl's corporate family rating to B2 from B1 and the probability of default rating to B2-PD from B1-PD.

Concurrently, Moody's downgraded all the ratings to B2 from B1, including the $39 million senior secured revolving credit facility due 2023, the $51 million senior secured guarantee facility due 2023, the £341 million senior secured term loan B1 due 2024, and the €363 million senior secured term loan B2 due 2024. All the facilities are borrowed by Kiwi VFS SUB II Sarl and guaranteed by Kiwi VFS SUB I.

The agency changed the outlook to negative from stable.

“The downgrade and revision of the outlook to negative was prompted by Moody's expectation that the company will face significant pressure on all its key credit metrics – including a material cash shortfall if no action is taken – over the next 12-18 months until air travel potentially recovers substantially in H2 2021,” the agency said in a press release.

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