Fitch rates Cerved B, cuts Castor

Fitch Ratings said it assigned Cerved Group SpA a first-time long-term issuer default rating of B. The outlook is negative.

The agency said it also downgraded the senior secured instrument rating under Castor SpA to B from B+ and revised its recovery rating to RR4 from RR3 following the issue of an additional €195 million of floating-rate notes. Castor's debt instruments have been transferred to Cerved following the reverse merger of the two entities.

“The B IDR reflects the group's aggressive leverage profile, temporarily weak financial flexibility due to weak revenue growth, high-interest payments and compressed free cash flow (FCF) generation, which are balanced by a strong market position in risk intelligence and supportive long-term sector trends,” the agency said in a press release.

Cerved's high leverage and low-interest coverage, for its rating, in 2024 and 2025 drives the negative outlook, Fitch said.

Finally, “We have also revised Castor's outlook to negative from stable while affirming its long-term IDR at B, and simultaneously withdrew the rating following its merger into Cerved,” the agency said.

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