Fitch cuts Ardonagh, rates notes CCC

Fitch Ratings said it downgraded Ardonagh Midco 3 plc’s long term issuer default rating to B- from B and assigned an expected rating of CCC to the proposed £400 million equivalent dollar-denominated senior payment-in-kind toggle notes due 2026.

The agency also cut the senior secured rating to B/RR3 from B+/RR3 and assigned Ardonagh Midco 2 plc a B- rating and an expected subordinated rating of CCC

“The downgrade of Ardonagh follows the total £2 billion refinancing of its debt structure enabling the company to fund the acquisitions of the Bravo Group (Bravo) and the Arachas Group (Arachas). Funds from operations (FFO) gross leverage is expected to remain above 7x for at least three years under our assumptions, above our thresholds for the previous B rating,” Fitch said in a press release.

The outlook is stable.

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