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Mobico (Baa3 On review for downgrade/NR/BBB-) Fitch Downgrade

TRANSPORTATION
  • Fitch downgraded 1-notch to BBB- Stable, well priced with 31s at Z+280/B+314/5.6%.
  • A name we have been on the side lines with; long duration with no curve & event risk on potential US school-bus business sale are key risks for us. On latter Fitch adds sale is not factored into ratings given uncertainty. 31s are +25 wider over the week.
  • Fitch has noted companies IG & net leverage target of 1.5x-2 but added "this is unlikely to be achieved in the next three years, in our view."

Last note was after Moody's downgrade last month.

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