S&P cuts Casino Guichard – Perrachon

S&P said it lowered Casino Guichard – Perrachon’s issuer rating to CC from CCC-, the group’s secured debt to CCC- from CCC and its senior unsecured debt to C from CC. The agency also removed all ratings from CreditWatch negative where they were placed on May 9. The outlook is negative.

S&P also revised down the recovery rating on Casino's senior unsecured debt to 6 (0% recovery expectations) from 5 (25%).

“This is because of the additional €300 million first-rank debt originated by the government's decision to delay the payment of tax and social security liability, the disposal of Casino's last stake in Assai for liquidity needs, and that Casino's revolving credit facilities are currently fully drawn,” the agency said in a press release.

On July 28, Prospect News reported Casino agreed in principle with creditors holding more than two-thirds of the term loan B, and the consortium formed by EP Global Commerce, Fimalac, and Attestor to execute a restructuring and capital increase, which will include €1.2 billion of new cash equity. All restructuring operations are expected to be effective during 2024’s first quarter.

“We expect Casino's default to be imminent and a virtual certainty. The default could arise from the non-payment of interest or debt, or from the execution of the announced transaction, that we would view as a distressed debt exchange and tantamount to default, as the obligations will not be fulfilled as originally promised,” S&P said.

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