Fitch moves Winterfell view to positive

Fitch Ratings said it revised the outlook for Winterfell Financing Sarl (Stark Group) to positive from stable and affirmed the long-term issuer default rating at B. The agency also affirmed the B+/RR3 ratings on the group's €1.345 billion senior secured term loan B.

“The revision of the outlook reflects Fitch's view that the Sgbduk acquisition contributes to the improving business profile and has a broadly neutral impact for Stark's gross leverage. Overall, the transaction is EBITDA-accretive, although some margin dilution is expected in the next two years. Fitch believes Stark will maintain EBITDA leverage below 5.5x throughout and a low-single-digit free cash flow (FCF) margin over the rating horizon, (except the year ending July 2023, where we expect some impact to FCF from non-recurring cash items from the transaction and first-time integration),” the agency said in a press release.

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