Fitch rates PIK Securities notes BB-

Fitch Ratings said it assigned PIK-Corp. a senior unsecured rating of BB- and its bond financing vehicle PIK Securities DAC's planned notes an expected senior unsecured rating of BB-. The notes are guaranteed on a senior unsecured debt-ranking basis by LLC PIK-Corp.

“Fitch expects FFO leverage to increase to 2.3x at end-2021, temporarily exceeding our negative rating sensitivity of 2.0x, due to large working capital outflows driven by the ongoing transition to the new escrow scheme. The new issuance will only increase total debt by up to 10%, so will not materially change our projections. Management expects that by 2023 most projects will be executed under the escrow scheme, which should normalize working capital volatility and improve leverage metrics. Our rating case indicates FFO leverage below 2x by 2023,” the agency said in a press release.

The notes, which will be used to finance the group's international expansion, will rank pari passu with all other senior unsecured debt of LLC PIK-Corp., the agency said.

The outlook is stable.

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