Fitch snips Moto Ventures

Fitch Ratings said it downgraded Moto Ventures Ltd.'s long-term issuer default rating to B- from B. The outlook is stable. Fitch also downgraded Moto's £150 million second-lien debt rating to CCC+/RR5/23%, from B+/RR3/51%.

“The downgrade is driven by slower deleveraging to a level consistent with a B rating than Fitch had anticipated, amid the severe impact from the coronavirus pandemic, a period of expansionary capex and a historically generous shareholder remuneration policy, which resulted in tight rating headroom. The rating remains supported by a stable business model with steady earnings and operating cash flow,” the agency said in a press release.

The second-lien rating downgrade is driven by Fitch’s expectation of an added £83 million in senior debt and a new senior debt facility to boost liquidity, leading to lower recoveries for second-lien creditors in the event of default, Fitch said.

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