Rekeep - comment

S&P reaffirmed Rekeep’s rating at B, but kept its outlook on Negative.  The reasons quoted by the S&P analyst echos comments we have made in the past; a slightly improving EBITDA, but FCF to be weak, albeit positive, due to higher CAPEX and higher interest costs.  With upcoming maturities, the Company have appointed advisers and are looking at all possibilities to aid a refinancing, including a potential asset sale.  We have previously highlighted the evolution of its capital structure since bond issuance, with the upcoming refinancing rates 300-400bps wider than previously.  S&P have a recovery rating of “3”, indicating a meaningful recovery, 50-70; rounded estimate 55%) which we still view is a cautious figure.