S&P rates VF Ukraine, notes B

S&P said it assigned B ratings to VF Ukraine PJSC and its proposed loan participation notes to be sold by its subsidiary VFU Funding plc.

The company plans to sell up to $500 million in LPNs to refinance its bridge loan facility. “We anticipate that the issuance will mean adjusted debt to EBITDA of 2x-2.5x and FOCF to debt of about 10% in 2020. On Dec. 3, 2019, MTS concluded the sale of VF Ukraine to Azerbaijan-based Neqsol Holding for a total consideration of $678 million. Neqsol financed the acquisition using equity combined with a bridge loan facility of $464 million. VF Ukraine now plans to refinance this facility. An issuance of up to $500 million will cause adjusted debt to EBITDA to spike at about 2.5x in 2020, before coming down to 2x-2.5x in 2021. The company is committed to reducing leverage,” S&P said in a press release.

The outlook is stable.

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