Moody’s upgrades Lecta rating

Moody’s Investors Service said it upgraded Lecta Ltd.’s probability of default rating to Caa2-PD/LD from Ca-PD, affirmed its Caa2 corporate family rating and changed the outlook to positive from stable.

The agency also decided to withdraw the B3 ratings of the €115 million backed senior secured bank credit facilities borrowed by Paper Industries Holding Sarl. At the time of withdrawal, the outlook on Paper Industries was negative.

These actions follow Lecta’s scheme of arrangement which took effect Dec. 7, Moody’s said. Prospect News reported on Lecta getting needed consents on Oct. 30.

“The positive outlook reflects Moody's expectation that the provision of new money and the extension of debt maturities will enable Lecta to proceed with its transformation towards specialty paper reducing the reliance on the declining graphic paper business and that this will translate into a more robust business profile. The positive outlook also reflects the agency's expectation that destocking patterns will ease during the course of 2024, which will enable Lecta to gradually improve its credit metrics,” the agency said in a press release.

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