Research Update: Sweden-Based Debt Collector Intrum Outlook Revised To Negative On Deleveraging Uncertainty, 'BB+/B' Ratings Affirmed

In light of Intrum AB's ambitious earnings-per-share target, we consider that the company may take longer to reduce debt to EBITDA and adopt a more aggress financial risk profile than we previously anticipated, despite its publicly announced 2.5x-3.5x leverage target by 2020. Additionally, we believe that private equity fund Nordic Capital will retain its more than 40% stake in Intrum longer than anticipated, which could weigh on our assessment of Intrum's financial risk profile. We are therefore revising our outlook on Intrum to negative from stable, and affirming our 'BB+/B' long- and short-term issuer credit ratings. The negative outlook reflects that we could downgrade Intrum if its financial policy becomes more aggressive than we expect, its investment strategy becomes more

...- In light of Intrum AB's ambitious earnings-per-share target, we consider that the company may take longer to reduce debt to EBITDA and adopt a more aggress financial risk profile than we previously anticipated, despite its publicly announced 2.5x-3.5x leverage target by 2020. - Additionally, we believe that private equity fund Nordic Capital will retain its more than 40% stake in Intrum longer than anticipated, which could weigh on our assessment of Intrum's financial risk profile. - We are therefore revising our outlook on Intrum to negative from stable, and affirming our '##+/B' long- and short-term issuer credit ratings. - The negative outlook reflects that we could downgrade Intrum if its financial policy becomes more aggressive than we expect, its investment strategy becomes more complex, or if it materially depletes liquidity....

Research Update