Moody’s slices Farfetch

Moody's Investors Service said it downgraded Farfetch Ltd.’s to C from Caa2 the long-term corporate family rating, the probability of default rating to C-PD from Caa2-PD and to Caa2 from B3 the rating of the $600 million senior secured first-lien term loan borrowed by the company's former indirect subsidiary, Farfetch US Holdings, Inc. (Farfetch US).

The outlook is now negative for both issuers; previously, all ratings were on review for downgrade. The downgrade and the revised outlook conclude the review for downgrade started on Dec. 12, Moody’s said.

The negative outlook reflects the elevated risk of default, the agency noted.

“The rating action follows the widely reported liquidity issues of the business in the final weeks of 2023, which has ultimately resulted in a change of ownership of Farfetch's subsidiaries and the expectation that the company will default on its payment obligations in respect of its convertible notes. Governance considerations were a key driver of the rating action,” the agency said in a press release.

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