Fitch lowers MEPC rating

Fitch Ratings said it downgraded MEPC Ltd.'s senior unsecured rating to B from BB. MEPC's short-term rating is affirmed at B.

The outlook is negative.

Fitch said the rating action reflects management's stated intention to raise about £400 million of new three- or five-year term secured bank debt, which is expected to have a floating charge over the assets of MEPC. This will subordinate MEPC's existing unsecured bondholders.

Fitch said it has further concerns that the 2032 bondholders are faced with MEPC's deteriorating lease term profile and weaker documentation with no negative pledge or restriction on disposals clause.

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