Bulletin: Hema's Rating Headroom Has Tightened Despite Debt Reduction After Shareholder Change

FRANKFURT (S&P Global Ratings) Dec. 5, 2018--S&P Global Ratings said today that the sale of Netherlands-based retail chain Hema B.V. (B-/Stable/--) has no imminent impact on our ratings or outlook on Hema. That said, following the company's weaker-than-expected second-quarter reporting and given prolonged adverse weather during summer, we have revised our base case for Hema and note that headroom under the current rating has decreased, leaving less leeway for further underperformance. The sale of Hema to Marcel Boekhoorn's Ramphastos Investments from previous owner Lion Capital has been completed as planned. We understand that Hema's two rated bonds remain outstanding, given management's confirmation upon closing that the portability clause included in bond indentures is active. While we see the intended debt

...FRANKFURT (S&P Global Ratings) Dec. 5, 2018--S&P Global Ratings said today that the sale of Netherlands-based retail chain Hema B.V. (B-/Stable/--) has no imminent impact on our ratings or outlook on Hema. That said, following the company's weaker-than-expected second-quarter reporting and given prolonged adverse weather during summer, we have revised our base case for Hema and note that headroom under the current rating has decreased, leaving less leeway for further underperformance. The sale of Hema to Marcel Boekhoorn's Ramphastos Investments from previous owner Lion Capital has been completed as planned. We understand that Hema's two rated bonds remain outstanding, given management's confirmation upon closing that the portability clause included in bond indentures is active. While we see the intended debt reduction, including the announced partial termination of shareholder-held payment-in-kind notes as positive, we will further assess the new shareholder's strategy and financial policy...

Bulletin