Fitch places Banijay on rating watch

Fitch Ratings said it placed Banijay Group SAS’ B+ rating on rating watch negative following the announcement the company entered a pact to buy Endemol Shine Group. Fitch also put the company’s instrument ratings have also been placed on RWN.

“Considering Banijay’s intention to fully refinance Endemol’s debt, we believe the combined group’s funds from operations (FFO) lease-adjusted net leverage is likely to increase, possibly leading to a one-notch downgrade. As a transformative acquisition (Endemol is twice as big as Banijay), the transaction should entail some significant execution risk to integrate Endemol and deliver synergies. However, Banijay has a good track record of integrating smaller acquisitions and Banijay’s chairman, CEO and other senior managers previously worked at Endemol,” Fitch said in a press release.

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