S&P cuts Awaze loans

S&P said it lowered the ratings on Awaze Ltd.’s €105 million revolver due in 2024 and €444 million first-lien debt due in 2025 to B- from B and trimmed the recovery ratings to 3 from 2. The 3 recovery rating reflects a meaningful (50%-70%) recovery in default from a substantial recovery (70%-90%). S&P also affirmed Awaze’s B- issuer rating.

The agency concurrently placed the ratings on CreditWatch with negative implications and withdrew the rating on the second-lien debt since it was repaid in 2023.

“Following Awaze's sale of Landal in April 2023, we now assess its business risk profile as weak. Landal, a holiday park operator in the Netherlands, generated about 50% of Awaze's revenue and almost 60% of its management-adjusted EBITDA in 2022. Following the sale of this business, Awaze has significantly reduced its size and business diversification. In addition, its focus has shifted to providing a technology platform to holiday property owners both in the U.K., through Awaze U.K., and Europe, through Novasol,” S&P said in a press release.

S&P said it forecasts Awaze’s 2023 revenues to be under €400 million in 2023 with S&P Global Ratings-adjusted EBITDA of €65 million-€70 million, compared to €811 million with S&P Global Ratings-adjusted EBITDA of €185 million including Landal in 2022.

The agency warned the negative watch reflects the elevated potential for a downgrade unless Awaze refinances its upcoming debt maturities, addresses its weak liquidity position, and demonstrates a path to deleveraging.

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