S&P Global Ratings' European corporate default tally (including financial and nonfinancial sectors) reached a high of 42 in 2020, up from 15 in 2019 (see chart 1). This total far exceeded the prior record of 23 from 2002.

Given the severe impact of economic lockdowns and social distancing, many more sectors than usual experienced defaults. The consumer services sector led with 11 defaults, followed by the energy and natural resources sector with 10. The leisure time/media sector accounted for six defaults, and transportation produced five. The only sectors that did not have any defaults in 2020 were financial institutions, insurance, and utilities. There are several subsectors within the consumer services sector, including retail and restaurants, which accounted for four of the 11 defaults in the sector in 2020.

One-third of all European defaults in 2020 were from the U.K. and associated tax havens. This was somewhat higher than the U.K. region's share of the European speculative-grade corporate ratings total (roughly 25%).

The annual default rate reached a high of 2.3% in 2020, up from 0.94% in 2019. For the 11th year in a row, no corporate issuers that we rated investment-grade ('BBB-' or higher) at the beginning of 2020 defaulted during the year. The speculative-grade ('BB+' or lower) default rate increased to 5.3%, from 2.2% a year earlier. This marked the highest speculative-grade default rate for the region since hitting 8.6% in 2009 and is well above the 30-year median of 2.2% (see table 1).

Table 1

By the end of 2020, credit quality among European speculative-grade corporations had deteriorated further, with the proportion of issuers rated 'B-' or lower reaching 33% (from a previous high of 22% at the end of 2019) after a large wave of downgrades in the first and second quarters.

The count of active corporate ratings in Europe has increased noticeably since the financial crisis, in large part because of the increase in new issuers (see table 4). New speculative-grade issuers have made up the majority of the annual totals since 2010. For the purposes of our default studies, we consider issuers that have reemerged from prior defaults to be new issuers once they receive the post-default ratings.

Our credit ratings continue to serve as effective indicators of relative creditworthiness. The one-year Gini coefficient--a measure of the rank-ordering power of ratings--for European corporate issuers was 87% in 2020, down from 90% in 2019. From 1981 to 2020, the one-year weighted average Gini coefficient was 90.4%, the three-year average was 85.2%, and the five-year average was 82.4%.

We base this study on our public and confidential issuer credit ratings on both nonfinancial and financial companies, but we exclude credit estimates, which we typically base on private information that we receive from investors. We include European industrials, utilities, financial institutions--including banks, brokerages, asset managers, and other financial entities--and insurance companies.

We base our calculations of default and transition rates on the number of issuer credit ratings rather than the affected debt volumes. Where we refer to the weighted average values of certain statistics across different periods, we weight the statistics for each period by the number of issuer credit ratings outstanding at the beginning of each period. Further details on our calculation approaches and the terminology we use in this study, including a list of the European countries that we included, are in Appendix I. Further details on the Gini coefficient methodology are in Appendix II.

2020 Observations

Below are key observations from our review of European corporate defaults and rating transitions in 2020:

• Of the European defaulters in 2020, 50% were from two sectors: consumer services (26% of the total) and energy and natural resources (24%) (see table 2).
• Of the total 42 European defaults in 2020, 14 came from the U.K. and associated tax havens, while Luxembourg had seven corporate defaults and Spain had six corporate defaults.
• As of Jan. 1, 2020, we publicly rated 35 of the European corporate issuers that defaulted over the following year, all but three of which were rated speculative-grade.
• Two issuers defaulted twice in 2020, and one other was not rated at the start of 2020.
• Only two of the 2020 defaulters were initially rated speculative-grade: Valaris PLC was first rated 'BBB+' in January 2010, and Distribuidora Internacional de Alimentacion S.A. was first rated 'BBB-' in June 2014.
• Luxembourg-based Intelsat S.A. had the highest debt associated with default in 2020, with $18.5 billion in outstanding debt at the time of its selective default on April 15.
• We estimate the volume of outstanding debt associated with European corporate defaulters in 2020 was $110.3 billion, up from $26 billion in 2019. Globally, there were 226 defaulters that accounted for about $353.4 billion in debt in 2020.
• Expressing defaults as a proportion of total ratings, the European speculative-grade corporate default rate increased to 5.3% in 2020 from 2.2% in 2019, below 6.6% in the U.S. and 5.5% globally (see chart 2).
• For the 42 European defaults in 2020, the average time to default from the initial rating was 4.8 years, down from 5.6 years in 2019 and above the long-term average of 4.34 years.
• At year-end 2020, speculative-grade issuers accounted for 44.5% of all European corporate ratings, higher than 43.6% at the end of 2019 and up considerably from 17.9% at the end of 2009 (see chart 3).
• Of the 42 defaults in 2020, 32 were selective defaults, and of those, 20 were the result of distressed exchanges.

Table 2

• No European corporate entities that we rated higher than 'BB' at the beginning of 2020 defaulted during the year.
• Defaults from the lowest ratings ('CCC'/'C') far exceeded those from any other rating (see table 3).

Table 3

• Many new issuers, particularly at the lowest rating levels, were the result of completed distressed exchanges.
• In 2020, we saw a record-high 20 new 'CCC'/'C' issuers, but 16 of these were issuers that had previously defaulted (see table 4).

Table 4

• Energy and natural resources companies had the highest default rate, at 10.1%, a record high just beating out the 10% rate in 2016 (see table 5).

Table 5

• The aggregate 2020 default rates for nonfinancial companies exceeded the long-term averages across the one-, three-, and 10-year horizons.
• Although there were no financial services defaults in 2020, the three- and 10-year default rates for all financial companies in 2020 still exceeded their long-term averages (see table 6).

Table 6

Cumulative Default Rates

Our default studies all show a clear negative correspondence between ratings and defaults: The higher the issuer credit rating, the lower the observed default frequency, and vice versa. This relationship holds over time (see chart 4 and tables 7-8). For example, on average, from 1981 to 2020, European corporate issuers rated in the 'AA' category had a 0% default rate in the following year, a 0.02% default rate in the second year, and a 0.05% default rate in the third year. By comparison, issuers rated in the 'B' category recorded, on average, default rates of 2.2% in the first year, 5.7% in the second, and 8.9% in the third.

Europe has historically had fewer entities rated in the 'CCC'/'C' category than other regions, so the cumulative average default rate for this category might be less meaningful. The European region didn't have a significant proportion of speculative-grade ratings until 1996, so European cumulative average default rates are only now starting to fall more in line with the rates elsewhere.

Table 7

Table 8

Rating Transitions

In 2020, downgrades surpassed upgrades by a factor of 7.5x--the highest since 1992 (see table 9)--and by 8.5x including defaults. Credit quality suffered during the pandemic, pushing the upgrade rate to its lowest since 1993, while the downgrade rate hit nearly 18%, a level not seen since 2012.

Table 9

Typically, nonfinancial companies experience higher credit deterioration than financial services companies in a given year, and this was especially true in 2020 (see chart 5). Nonfinancial companies typically have more ratings at the lowest end of speculative-grade, and last year posed particular difficulties for sectors dependent on in-person interaction, such as gaming, lodging, retail, transportation, and various other media and entertainment subsectors.

Generally, European investment-grade companies tend to exhibit greater credit stability (as measured by the frequency of rating transitions) than their speculative-grade counterparts. For instance, about 85.7% of European corporate entities rated in the 'AA' category at the beginning of 2020 were still rated in that category at the end of the year, whereas the comparable measure for companies rated in the 'B' category was only 74.8% (see table 10).

Table 10

The 2020 pattern correlates with the long-term ratings behavior trend among all global rated issuers. This study--in line with our previous default studies--confirms that higher ratings are generally more stable than lower ratings. On average, of all of the European corporate issuers that we rated in the 'A' category, 87.8% retained ratings in the same category after one year, whereas only 72.8% of those rated in the 'B' category remained in the same rating category a year later (see table 11). Lower ratings also tend to exhibit less stability than higher ratings over multiyear time horizons (see table 12).

Table 11

Table 12

The transitions at the rating modifier level (that is, including the "plus" or "minus" identifiers) also generally exhibit the same relationship, although differences in sample sizes occasionally create slight variations between adjacent rating levels (see table 13).

Table 13

Time To Default

Higher-rated corporate entities generally exhibit a longer time to default than their lower-rated counterparts when using the original ratings as the reference points (see table 14). For example, European corporate entities that we initially rated in the 'B' category but that later defaulted took an average of 3.9 years to default--less than the average of 7.5 years for defaulting entities that we originally rated in the 'A' category. For the corporate entities that defaulted in 2020, an average of 4.8 years elapsed between the initial rating date and the default date, slightly above the long-term average of 4.3 years.

Table 14

For the entire long-term history of European corporate defaults (257 for 1981-2020), the average time to default across all rating categories was 4.3 years, compared with 5.9 years globally (see chart 6). The relationship between the initial rating and the time to default is less clear in Europe partly due to smaller sample sizes. In the 40 years ended in 2020, 1,735 companies with initial ratings in the 'B' category defaulted globally, and only 140 were from Europe.

In 2020, most defaulters in Europe were initially rated in the 'B' category. Among the 2020 defaulters, Valaris PLC and Distribuidora Internacional de Alimentacion S.A. were initially rated investment-grade.

As expected, the average time to default for post-original ratings (in other words, excluding initial ratings) also shows that higher-rated corporate issuers generally take longer to default. However, the time to default is somewhat shorter than from initial ratings (see chart 7).

Gini Coefficients And Lorenz Curves

A quantitative analysis of ratings performance shows that our European corporate ratings continue to correlate with the level of default risk across different time horizons.

To measure ratings performance, we plot the cumulative share of defaulters against the cumulative share of issuers by rating in a Lorenz curve, which visually represents the ratings' rank-ordering power and is summarized quantitatively by the Gini coefficient (see definitions and methodology in Appendix II).

Over the long term, the European corporate weighted average one-year Gini coefficient was 90.4%, the three-year average was 85.2%, and the five-year average was 82.4% (see table 15 and charts 8-10).

Table 15

The Gini coefficients decline as the time horizon lengthens because longer time horizons allow for more opportunities for credit degradation among higher-rated entities. In the one-year Lorenz curve for European corporate issuers, for example, 96.9% of defaults were in speculative-grade rating categories, while the speculative-grade segment accounted for only 26.2% of all European corporate issuers (see chart 8).

The five-year Lorenz curve shows speculative-grade issuers accounted for 90.5% of defaulters and only 21.8% of the entire sample (see chart 10). If the rank ordering of ratings had little predictive value, the cumulative share of defaulting entities and the cumulative share of all entities would be nearly the same, producing a Gini coefficient close to zero.

Appendix I: Calculation Approach And Definitions

This long-term corporate default and rating transition study uses S&P Global Market Intelligence's CreditPro® database of long-term local currency issuer credit ratings. The analysis excludes public information (pi) ratings and ratings based on the guarantee of another company or government entity. We also do not include short-term issuer credit ratings. We do not require all issuers with debt that we rate to have an issuer credit rating. Therefore, if an issuer has rated debt but not an issuer credit rating, we assign a proxy rating so the CreditPro® corporate dataset accurately represents the complete universe of ratings. The local currency senior unsecured rating is the preferred debt rating used for the proxy because this rating is usually consistent with the issuer credit rating. In a small number of cases, we use the subordinated debt rating or the senior secured rating as the proxy.

An issuer credit rating is a forward-looking opinion about an obligor's overall creditworthiness. This opinion focuses on the obligor's capacity and willingness to meet its financial commitments as they come due. It does not apply to any specific financial obligation because it does not take into account the nature and provisions of any single obligation, its standing in bankruptcy or liquidation, statutory preferences, or the legality and enforceability of the obligation. Issuer credit ratings can be either long-term or short-term.

Our ongoing enhancement of the database used to generate this study could lead to outcomes that differ to some degree from those reported in previous studies. However, each annual default and transition study reports statistics back to Dec. 31, 1980, and is therefore self-contained and effectively supersedes all previous editions.

Issuers included in this study

This study analyzes the rating histories of 3,983 European companies that we rated as of Dec. 31, 1980, or that we first rated between that date and Dec. 31, 2020. These include industrials, utilities, financial institutions, and insurance companies in the region with long-term local currency ratings. Structured finance vehicles, public-sector issuers, and sovereign issuers are the subjects of separate default and transition studies, and we exclude them from this study.

For the purposes of this study, Europe consists of Austria, Belgium, the British Virgin Islands, Bulgaria, the Channel Islands, Croatia, Cyprus, the Czech Republic, Denmark, Estonia, Finland, France, Germany, Gibraltar, Greece, Guernsey, Hungary, Iceland, Ireland, the Isle of Man, Italy, Jersey, Latvia, Liechtenstein, Lithuania, Luxembourg, Malta, Monaco, Montenegro, the Netherlands, Norway, Poland, Portugal, Republic of Moldova, Romania, Slovakia, Slovenia, Spain, Sweden, Switzerland, and the U.K.

To avoid overcounting, we exclude subsidiaries with debt that is fully guaranteed by a parent or with default risk that we consider identical to that of a parent. The latter case arises for companies with obligations that are not legally guaranteed by a parent but that have operating or financing activities that are so entwined with those of the parent that a default of one and not the other would be highly unlikely, in our view. At times, however, a parent's guarantee might not have yet covered some of these subsidiaries, or the relationship that combines the default risk of parent and subsidiary might have come to an end or might not have begun. We include such subsidiaries in the dataset for the period during which they had distinct and separate risk of default.

Issuers with withdrawn ratings

We withdraw ratings when an entity's entire debt is paid off or when the program or programs that we rate are terminated and the relevant debt extinguished. We may also withdraw ratings at the issuer's request, as a result of a merger or acquisition, or when a company no longer provides all of the information we require to continue surveillance on the ratings.

Definition of default

For the purposes of this study, we deem 'D' (default), 'SD' (selective default), and 'R' (regulatory intervention) issuer credit ratings to be defaults. We assume the default takes place on the earliest of the date we revised the rating(s) to 'D', 'SD', or 'R'; the date the issuer missed a debt payment; the date a distressed exchange offer was announced; or the date the debtor filed for bankruptcy.

An obligor rated 'SD' or 'D' is in default on one or more of its financial obligations, including rated and unrated financial obligations but excluding hybrid instruments classified as regulatory capital or in nonpayment according to terms. We consider an obligor to be in default unless we believe that such payments will be made within five business days of the due date in the absence of a stated grace period, or within the earlier of the stated grace period or 30 calendar days.

We assign a 'D' rating when we believe that the default will be a general default and that the obligor will fail to pay all or almost all of its obligations as they come due. We assign an 'SD' rating when we believe the obligor has selectively defaulted on a specific issue or class of obligations but will continue to meet its payment obligations on other issues or classes of obligations in a timely manner. We also lower our rating on an obligor to 'D' or 'SD' if it is conducting a distressed exchange offer, whereby one or more financial obligations are either repurchased for an amount of cash or replaced by other instruments with a total value that is less than par.

An obligor rated 'R' is under regulatory supervision owing to its financial condition. During the pendency of the regulatory supervision, the regulators may have the power to favor one class of obligations over others or pay some obligations and not others. While the 'R' rating was in place during many of the years covered in this study, it was removed from all ratings scales on July 5, 2019 (see "S&P Global Ratings Definitions," Jan. 5, 2021).

When an issuer defaults, we commonly subsequently withdraw the 'D' or 'SD' rating. For the purposes of this study, if an issuer defaults, we end its rating history at 'D'. If any defaulting entity reemerges from bankruptcy--or otherwise restructures its defaulted debt instruments, thereby reestablishing regular, timely payment on all its debts--we reenter this issuer into the database as a new entity. Its rating history after the default event is included in all calculations as entirely separate from its rating history prior to the earlier default.

Many practitioners use statistics from this default study to estimate "probability of default" and "probability of rating transition," based on observed historical default and transition frequencies. It is important to note that we do not ascribe a specific default probability to each rating category.

Calculations

Static pool methodology.  S&P Global Ratings Research conducts its default studies on the basis of groups of ratings called static pools. For the purposes of this study, we form static pools by grouping issuers by rating category at the beginning of each year, quarter, or month that the database covers. Each static pool is followed from that point forward. We assign all companies included in the study to one or more static pools. When an issuer defaults, we assign that default to all of the static pools to which the issuer belonged.

We use the static pool methodology to avoid certain pitfalls in estimating default rates, such as by ensuring that default rates account for rating migration and can be calculated across multiperiod time horizons. Some methods for calculating default and rating transition rates might charge defaults against only the initial rating on the issuer, ignoring more recent rating changes that supply more current information. Other methods may calculate default rates using only the most recent year's default and rating data, which may yield comparatively low default rates during periods of high rating activity because they ignore prior years' default activity.

The pools are static in the sense that their membership remains constant over time. Each static pool can be viewed as a buy-and-hold portfolio. Because errors, if any, are corrected in each update and because the criteria for inclusion or exclusion of companies in the default study are subject to minor revisions as time goes by, it is not possible to compare static pools across different studies. Therefore, every update revises results to the same starting date of Dec. 31, 1980, to avoid continuity problems.

Entities with ratings we have withdrawn or discontinued--that is, revised to not rated (NR)--are surveilled with the aim of capturing a potential default. Because static pools only include entities with active ratings as of the beginning date of a given pool, we exclude companies with withdrawn ratings, as well as those that have defaulted, from subsequent static pools. If the rating on an entity is withdrawn after the start date of a particular static pool and the entity subsequently defaults, we will include it in that static pool as a default and categorize it in the rating category of which it was a member at that time.

For instance, the 2001 static pool consists of all companies rated as of 12:01 a.m. on Jan. 1, 2001. Adding those companies first rated in 2001 to the surviving members of the 2001 static pool forms the 2002 static pool. All rating changes that took place are reflected in the newly formed 2002 static pool through the ratings on these entities as of 12:01 a.m. on Jan. 1, 2002.

Consider the following example: An issuer is originally rated 'BB' in mid-2000, and we downgrade the company to 'B' in 2002. This is followed by a rating withdrawal in 2003 and a default in 2004. We would include this hypothetical company in the 2001 and 2002 static pools with the 'BB' rating, which it held at the beginning of those years. Likewise, we would include it in the 2003 static pool with the 'B' rating. It would not be part of the 2004 static pool because it was not rated as of the first day of that year, and we would not include it in any pool after the last day of 2004 because we had withdrawn our rating on the company by then. Yet each of the three static pools in which we include this company (2001-2003) would record its 2004 default at the appropriate time horizon.

Default rate calculation.   We calculate annual default rates for each static pool, first in units and later as percentages of the issuers in each rating category. We combined these percentages to obtain cumulative default rates for the 40 years the study covers.

Issuer-weighted default rates.   We base all default rates that appear in this study on the number of issuers rather than the currency amounts affected by defaults or rating changes. Although currency amounts provide information about the portion of the market that is affected by defaults or rating changes, issuer-weighted averages are more useful measures of the performance of ratings.

Average cumulative default rate calculation.   In this study, we also calculate and present average cumulative default rates for different time horizons. For example, table 7 shows that the one-year average cumulative default rate for 'A' rated European corporate issuers is 0.03% and the three-year average is 0.10%.

We first consider the static pool of ratings at the beginning of each calendar year. For each static pool, we calculate the marginal default rates for each calendar year after the static pool's formation. These one-year marginal default rates are "conditional on survival." For example, the marginal default rate for the third year is equal to the number of defaults during the third year divided by the number of ratings from the static pool that had "survived" (in other words, not moved to 'D') by the beginning of the third year.

We then average the marginal default rates for each time horizon across static pools, weighting by the number of surviving ratings at the beginning of each time horizon, to give an average marginal default rate per time horizon, as well as average marginal survival rates (equal to one minus the average marginal default rate). Finally, the average cumulative default rate for each time horizon is calculated as one minus the product of marginal survival rates up to that time horizon.

Transition analysis

Transition rates compare the issuer credit ratings at the beginning of a period with the ratings at the end of the period. To compute one-year rating transition rates by rating category, we compare the rating on each entity at the end of a particular year with the rating at the beginning of the same year. An issuer that remained rated for more than one year was counted as many times as the number of years it was rated. For instance, an issuer rated from the middle of 1984 to the middle of 1991 would appear in the seven consecutive one-year transition matrices from 1985 to 1991. If the rating on the issuer was withdrawn in the middle of 1991, it would be included in the column representing transitions to NR in the 1991 transition matrix. Similarly, if it defaulted in the middle of 1991, it would be included in the column representing transitions to 'D' in the 1991 one-year transition matrix.

All 1981 static pool members still rated on Jan. 1, 2020, had 40 one-year transitions, while companies first rated on Jan. 1, 2020, had only one. Each one-year transition matrix displays all rating movements between rating categories from the beginning of the year through year-end. For each rating listed in the matrix's leftmost column, there are nine ratios listed in the rows, corresponding to the rating categories from 'AAA' to 'D', plus NR.

The only ratings considered in these calculations are those on entities at the beginning of each static pool and those at the end. All rating changes that occur in between are ignored. For example, if an entity was rated 'A' on Jan. 1, 2014, downgraded to 'BBB' in the middle of the year, and then upgraded to 'A' later in the year (with no other subsequent rating changes), this entity would be included only in the percentage of issuers that began the year as 'A' and ended the year as 'A'. This approach also applies to transition matrices that span longer time horizons. If an issuer defaults or the rating is withdrawn in the middle of the year, then we would consider it either rated 'D' or not rated as of Dec. 31 of that particular year.

Multiyear transitions

We also calculate multiyear transitions for periods of two to 10 years. In this case, we compare the rating at the beginning of the multiyear period with the rating at the end. For example, three-year transition matrices are the result of comparing ratings at the beginning of the years 1981-2018 with the ratings at the end of the years 1983-2020. Otherwise, the methodology is identical to the one we use for single-year transitions.

We calculate average transition matrices on the basis of the multiyear matrices just described. These average matrices are a true summary, the ratios of which represent the historical incidence of the ratings listed in the first column changing to the ones listed in the top row over the course of the multiyear period. Transition matrices that present averages over multiple time horizons are also calculated as issuer-weighted averages.

Rating modifiers

We use rating modifiers (plus and minus signs) to calculate the upgrade and downgrade rates, as well as the magnitude of rating changes, throughout this study. However, some transition tables may show only full rating categories for practical reasons. In other words, the use of a rating category suggests that transitions to, for example, 'AA-' from 'AA' or to 'BBB-' from 'BBB+' are not considered rating transitions because the rating remained within the rating category.

Standard deviations

Many of the tables and charts in this study display averages of default rates, transition rates, and Gini coefficients. Often these are issuer-weighted averages. Default and transition rates can fluctuate depending on many circumstances specific to particular time frames, industries, and geographic regions. As a supplement to many of the averages and time series we present in this study, we also show standard deviations to provide a gauge of the dispersion of data behind the averages.

For the transition matrices, the standard deviation for each cell in a given matrix is a weighted standard deviation, calculated using the data from each of the underlying static pool years that contribute to the averages, weighted by that static pool year's issuer base for each rating level. For example, in the average one-year transition matrix, each cell's weighted standard deviation is calculated from the series of that particular cell in each of the 40 static pools beginning with the 1981 static pool and ending with the 2020 static pool. The squared difference between each static pool's transition rate and the weighted average--which is the data point in each cell--is multiplied by each static pool's weight. These weights are based on each static pool rating level's contribution to the 40-year total issuer base for each rating level. We then divide this by the ratio of the total number of nonzero weights minus one and the total number of nonzero weights.

We derive Gini coefficients' standard deviations from the time series for all of their constituent annual static pools. As an example, we calculate the standard deviation for the seven-year weighted average global Gini coefficient from the time series of all available seven-year Gini coefficients by static pool. In this case, these are the seven-year Gini coefficients beginning with the 1981 static pool through the 2014 static pool. We calculated standard deviations for Gini coefficients in this study as the standard deviations of a sample, rather than as the standard deviations of a population.

Appendix II: Gini Coefficient Methodology

We calculate Gini coefficients as one way to quantify our ratings' rank-ordering power of creditworthiness, based on observed default rates.

To measure relative ratings performance, we use the Lorenz curve as a graphical representation of the proportionality of a distribution, and we summarize this via the Gini coefficient. For this study, the Lorenz curve is plotted with the x-axis showing the cumulative share of issuers, arranged by rating level, while the y-axis represents the cumulative share of defaulters, also arranged by rating level. For both axes of the Lorenz curve, the observations are ordered from the low end of the ratings scale ('CCC'/'C') to the high end ('AAA'). As an example, if 'CCC'/'C' rated entities made up 10% of the total population of issuers at the start of the time frame examined (x-axis) and 50% of the defaulters (y-axis), then the coordinate (10, 50) would be the first point on the curve.

We illustrate the procedure for calculating the Gini coefficient in chart 11. Area B is bounded by the random curve and the Lorenz curve, while area A is bounded by the Lorenz curve and the ideal curve. The Gini coefficient is defined as area B divided by the sum of area A and area B. The Gini coefficient can therefore range from 0% (if the Lorenz curve follows the random curve) to 100% (if the Lorenz curve follows the ideal curve). In general, therefore, the higher the Gini coefficient, the greater the link between our ratings and observed default propensity.

If our ratings only randomly approximated default propensity, the Lorenz curve would fall along the diagonal shown as the random curve in chart 11, and the Gini coefficient would be 0%. On the other hand, if all defaults occurred only among the lowest-rated issuers, with no defaults among the higher-rated issuers, the Lorenz curve would lie along the line shown as the ideal curve in chart 11, and the Gini coefficient would be 100%. Typically, the observed Lorenz curve falls between the ideal and random curves, and we use the Gini coefficient as a summary statistic to quantify its proximity to the ideal curve.

Appendix III: Detailed Cumulative Default And Transition Data

Table 16

Table 17

Table 18

Table 19

Table 20

Table 21

Table 22

Table 23

Table 24

Appendix IV: Profiles Of European Corporate Defaults In 2020

In 2020, there were 42 European corporate defaults affecting $110.3 billion of debt, and seven were from issuers that were confidentially rated. Two issuers, Noble Corp. PLC and Transocean Ltd., defaulted twice. This appendix summarizes the events leading up to and, in some cases, following each corporate default for the 35 publicly rated defaulters. We also list the debt instruments outstanding at the time of default.

Lecta S.A.

• €225 million floating-rate notes due Aug. 1, 2022
• €375 million 6.50% notes due Aug. 1, 2023
• €65 million floating-rate first-lien guaranteed bank loan due July 27, 2022

On Jan. 13, 2020, S&P Global Ratings lowered its long-term issuer credit rating on paper manufacturer Lecta S.A. to 'SD' from 'CC' after the company failed to pay the interest of €3.8 million due November 2019 on its €225 million senior secured floating notes due 2020.

On Feb. 4, 2020, S&P Global Ratings lowered its ratings on Lecta to 'D' from 'SD' upon the company's completion of a restructuring of its debt obligations. We subsequently withdrew the ratings.

Table 25

Deoleo S.A.

• €85 million variable-rate revolving credit facility bank loan due June 13, 2020
• €55 million variable-rate second-lien bank loan due June 13, 2022
• €460 million variable-rate bank loan due July 13, 2021

On Jan. 22, 2020, S&P Global Ratings lowered its long-term issuer credit rating on Spanish olive oil bottler Deoleo S.A. to 'SD' from 'CC' after a majority of shareholders agreed to a restructuring of its syndicated debt. The syndicated creditors would now acquire 49% of the capital of the operating business.

On July 20, 2020, S&P Global Ratings raised the issuer credit ratings to 'B-' from 'SD' after the issuer completed its debt restructuring, resulting in its syndicated debt falling to €242 million from €575 million and the extension of debt maturities on its €160 million senior term loan and €82 million junior term loan by five and six years, respectively.

Table 26

Doncasters Group Ltd.

• €160 million variable-rate bank loan due April 9, 2020
• US$750 million variable-rate bank loan due April 9, 2020
• US$290 million variable-rate (outstanding amount US$160 million) bank loan due Oct. 9, 2020

On Jan. 29, 2020, S&P Global Ratings lowered its long-term issuer credit rating on U.K.-based engineered components manufacturer and marketer Doncasters Group Ltd. after the issuer received lender support for financial restructuring. The new approval included transfer of ownership to Alloy Topco Ltd.

On Oct. 26, 2020, S&P Global Ratings withdrew its ratings on the issuer.

Table 27

Moby SpA

• €300 million 7.75% notes due Feb. 15, 2023
• €200 million floating-rate bank loan due Feb. 11, 2021
• €60 million floating-rate bank loan due Feb. 11, 2021

On Feb. 14, 2020, S&P Global Ratings lowered its long-term issuer credit rating on Italy-based maritime transportation services Moby SpA to 'SD' from 'CCC-' after the company entered into a standstill agreement to not pay scheduled payments in mid-February.

On Jan. 18, 2021, S&P Global Ratings withdrew its ratings at the issuer's request.

Table 28

KCA Deutag Alpha Ltd.

• US$375 million floating-rate term loan B bank loan due Feb. 28, 2023
• US$215 million first-lien guaranteed senior secured revolver bank loan due March 31, 2022
• US$375 million 7.25% notes due May 15, 2021
• US$535 million 9.875% notes due April 1, 2022
• US$400 million 9.625% notes due April 1, 2023

On April 2, 2020, S&P Global Ratings lowered its long-term issuer credit rating on U.K.-based oilfield services company KCA Deutag Alpha Ltd. to 'SD' from 'CCC+' after the issuer announced it would use the grace period for interest payments. The issuer was going through debt restructuring for a wider capital improvement but was adversely affected by falling oil prices and the coronavirus pandemic. Later, on May 2, 2020, the issuer entered into a standstill agreement with the lenders of the notes due 2021 and the term loan due 2023, until July 31, 2020.

Table 29

Intelsat S.A.

• US$2 billion 7.75% senior unsecured notes due June 1, 2021
• US$1 billion 8.125% senior notes due June 1, 2023
• US$750 million 12.50% senior notes due April 1, 2022
• US$1 billion senior notes due Feb. 28, 2023
• US$2.2 billion 7.25% guaranteed notes due Oct. 15, 2020
• US$1.15 billion 7.50% guaranteed senior notes due April 1, 2021
• US$2 billion 5.50% senior guaranteed notes due Aug. 1, 2023
• US$1.25 billion senior notes due 2024
• US$490 million 9.50% senior notes due 2022
• US$1.8 billion 9.75% senior notes due July 15, 2025
• US$2 billion floating-rate term B-3 bank loan due Nov. 27, 2023
• US$395 million floating-rate B-4 bank loan due Jan. 2, 2024
• US$700 million 6.625% B-5 bank loan due Jan. 2, 2024
• US$2.95 billion notes due Oct. 15, 2024
• US$403 million 12.5% senior unsecured notes due Nov. 15, 2024

On April 15, 2020, S&P Global Ratings lowered its long-term issuer credit rating on Luxembourg-based telecom service provider Intelsat S.A. to 'SD' from 'CCC+' after the issuer failed to pay semiannual interest payments on unsecured debt.

On May 14, we lowered the ratings on the issuer to 'D' after it filed a voluntary petition under Chapter 11 of the U.S. Bankruptcy Code. The issuer had also obtained a commitment for $1 billion in debtor-in-possession financing.

On June 29, 2020, S&P Global Ratings withdrew its ratings on Intelsat.

Table 30

O1 Properties Ltd.

• RUB15 billion 13.00% notes due Oct. 2, 2020
• US$350 million 8.25% notes due Sept. 27, 2021
• US$355 million 7.00% notes due Jan. 29, 2021
• US$150 million 6.00% notes due May 18, 2021

On April 16, 2020, S&P Global Ratings lowered the issuer credit ratings on Cyprus-based real estate market investor O1 Properties Ltd. to 'D' from 'CC' after the issuer missed a coupon payment on US$350 million Eurobonds. This nonpayment was considered a general default, and the company was not expected to be able to pay most of its obligations.

Earlier, on April 10, 2020, we lowered the rating on the issuer to 'CC' from 'CCC-' after it was unable to obtain mezzanine debt lenders' consent to extend the loan and had insufficient liquidity.

On Sept. 25, 2020, we withdrew our 'D' long-term issuer and issue credit ratings at the issuer's request. At the time of the withdrawal, our 'D' rating reflected the nonpayment of the coupon on the $350 million Eurobond in April 2020, followed by a nonpayment of its mezzanine loan. Furthermore, weak liquidity supported our view of O1 Properties' general default. We expected the company would not be able to pay most of its obligations as they came due, unless a major debt restructuring underway allowed it to extend major debt maturities, including the $350 million Eurobond repayment due in September 2021.

Table 31

Evergreen Skills Lux S.a.r.l.

• US$1.365 billion floating-rate first-lien term bank loan due April 28, 2021
• US$80 million floating-rate revolving bank loan due Oct. 28, 2020
• US$670 million floating-rate second-lien term bank loan due April 28, 2022

On May 5, 2020, S&P Global Ratings lowered its long-term issuer credit rating on Luxembourg-based e-learning and -training content software provider Evergreen Skills Lux S.a.r.l. to 'D' from 'CCC-'. The company entered into a forbearance agreement with its senior debt lenders and was expected to pursue a debt restructuring.

On June 5, 2020, we withdrew our ratings on the issuer.

Table 32

Takko Fashion S.a.r.l.

• €225 million floating-rate notes due Nov. 15, 2023
• €285 million 5.375% notes due Nov. 15, 2023

On May 19, 2020, S&P Global Ratings lowered its issuer credit rating on German value retailer Takko Fashion S.a.r.l. to 'SD' from 'CCC+' after the company missed an interest payment on its €510 million senior secured notes due November 2023.

Earlier, on April 22, 2020, we lowered our issuer credit rating on Takko to 'CCC+' from 'B-', reflecting our view that the group's ability to service its financial commitments could be further strained.

On Aug. 19, 2020, we raised the issuer credit rating to 'CCC-' from 'SD' after the issuer resumed interest payments on senior secured notes issued by its subsidiary.

Table 33

Travelex Holdings Ltd.

• £90 million floating-rate bank loan
• €360 million 8.00% callable notes due May 15, 2022

On May 25, 2020, S&P Global Ratings lowered the issuer credit rating on U.K.-based foreign exchange service provider Travelex Holdings Ltd. to 'D' from 'CCC' after the issuer failed to make interest payments on its senior secured notes. We viewed the nonpayment of interest as akin to default on the senior secured notes. This was due to the company's interest in preserving the liquidity and financial flexibility to continue operations.

On Aug. 24, 2020, S&P Global Ratings lowered the issuer credit ratings to 'D' from 'SD' after Travelex completed its restructuring plan, including the write-off of £225 million of debt. Later, on Oct. 15, 2020, we withdrew the ratings at the issuer's request.

Table 34

Noble Corp. PLC

• US$400 million 6.20% senior notes due Aug. 1, 2040
• US$500 million senior notes due Aug. 1, 2020
• US$400 million 4.625% senior hybrid due March 1, 2021
• US$400 million 6.05% senior hybrid due March 1, 2041
• US$400 million 3.95% notes due March 15, 2022
• US$500 million 5.25% notes due March 15, 2042
• US$450 million 5.95% senior notes due April 1, 2025
• US$400 million 6.95% senior notes due April 1, 2045
• US$1 billion 7.75% senior notes due Jan. 15, 2024
• US$750 million 7.875% senior notes due Feb. 1, 2026

On June 2, 2020, S&P Global Ratings lowered its issuer credit rating on U.K.-based offshore drilling contractor Noble Corp. PLC to 'SD' from 'CCC-' after the company paid off 85% of its two seller loans (unrated) in exchange for a discount to the outstanding balance, effectively repurchasing both loans at about 85% of par value. S&P Global Ratings considered the repurchase to be distressed and tantamount to default, given that the holders received less than the original promise on the securities and that the offer was made to avoid a default and cross-acceleration of Noble's unsecured debt.

On June 5, 2020, we raised our issuer credit rating on Noble to 'CCC-' from 'SD' after the company repurchased about $118 million in principal value of its two seller loans due 2022 and 2023 at 85% of par value in a transaction we viewed as a selective default.

On July 17, 2020, S&P Global Ratings lowered its long-term issuer credit rating on Noble to 'D' from 'CCC-' after the company skipped the interest payment on its 7.75% senior notes due 2024. We believed the company was unlikely to make this interest payment within the 30-day grace period, because it had pursued a comprehensive capital restructuring or bankruptcy filing.

On Sept. 14, 2020, we withdrew the issuer credit ratings on the company at its request.

Table 35

Valaris PLC

• US$150 million 7.20% debt due Nov. 15, 2027
• US$750 million 3.00% exchangeable senior notes due Jan. 31, 2024
• US$500 million 4.875% senior notes due June 1, 2022
• US$400 million 5.40% notes due Dec. 1, 2042
• US$400 million 4.75% senior notes due Jan. 15, 2024
• US$400 million 5.85% senior notes due Jan. 15, 2044
• US$1.5 billion floating-rate revolver bank loan due Jan. 23, 2021
• US$400 million 7.375% notes due 2025
• US$1.5 billion 4.70% notes due March 15, 2021
• US$625 million senior notes due Oct. 1, 2024
• US$1.025 billion 5.75% senior notes due Oct. 1, 2044
• US$700 million 5.20% senior notes due March 15, 2025
• US$500 million 8.00% senior notes due Jan. 31, 2024
• US$1 billion 7.75% senior notes due Feb. 1, 2026

On June 3, 2020, S&P Global Ratings lowered its issuer credit rating on U.K.-based offshore drilling contractor Valaris PLC to 'D' from 'CCC-' because the company did not pay the June 1 interest payments on its senior notes due 2022 and 2042, and the company continued to discuss the terms of a comprehensive debt restructuring with its debtholders. The downgrade reflected our belief that continued low crude oil prices, the weak outlook for offshore drilling services, and the distressed level at which Valaris' debt was trading made it likely the company would not make the interest payments within the grace period.

Earlier, on April 20, 2020, we lowered our issuer credit rating on Valaris to 'CCC-' from 'CCC+' following the collapse in oil prices that led to a sharp drop in demand for all oilfield services, as well as given the offshore activity that was expected to be weak over at least the next two years because of the higher cost, higher operating risk, and longer payback periods for offshore projects relative to onshore plays.

Later, on Sept. 16, 2020, we withdrew the issuer credit ratings on the company at its request.

Table 36

Missouri TopCo Ltd.

• £130 million 9.50% notes due Jan. 31, 2024
• £350 million 6.75% first-lien callable notes due Jan. 31, 2023
• £25 million 16.50% notes due July 25, 2022
• £50 million revolver due July 18, 2022

On July 30, 2020, S&P Global Ratings lowered its long-term issuer credit rating on U.K.-based retailer Missouri TopCo Ltd. to 'SD' from 'CCC-' after the issuer converted its £80 million second-lien notes into a payment-in-kind (PIK) toggle instrument. This scheme was expected to save about £7.6 million per year in cash, but the company was still facing an interest payment of about £35 million and huge rent payments.

On Aug. 6, 2020, S&P Global Ratings raised the issuer credit rating to 'CCC-' from 'SD'.

Table 37

Nostrum Oil and Gas PLC

• US$725 million 8.00% notes due July 25, 2022
• US$400 million 7.00% bonds due Feb. 16, 2025
• US$560 million 9.50% notes due June 25, 2033
• US$400 million 9.50% notes due Jan. 14, 2033

On July 30, 2020, S&P Global Ratings lowered its long-term issuer credit rating on U.K.-based oil and gas company Nostrum Oil and Gas PLC to 'SD' from 'CCC-' after the issuer announced nonpayment of interest on 2022 notes and 2025 notes and would likely use the grace period. Reduced EBITDA amid the pandemic and the oil price crisis in early 2020 stressed the operating performance of the issuer.

Table 38

PizzaExpress Financing 1 PLC

• £200 million 8.625% notes due Aug. 1, 2022
• £465 million 6.625% notes due Aug. 1, 2021

On Aug. 6, 2020, S&P Global Ratings lowered its long-term issuer credit rating on U.K.-based pizza restaurants operator PizzaExpress Financing 1 PLC to 'D' from 'CC' after the issuer opted for nonpayment of interest on its secured and unsecured notes. The issuer also conveyed that it entered into a lock-up agreement with its senior secured lenders and was in talks on a restructuring plan.

Table 39

Transocean Ltd.

• US$100 million 7.45% notes due April 15, 2027
• US$200 million 8.00% debt due April 15, 2027
• US$600 million 7.50% senior notes due April 15, 2031
• US$1 billion 6.80% senior notes due March 15, 2038
• US$900 million 6.50% senior notes due Nov. 15, 2020
• US$1.2 billion 6.375% senior notes due 2021
• US$300 million 7.35% senior notes due 2041
• US$750 million variable/fixed-rate senior unsecured notes due Oct. 15, 2022
• US$1.25 billion 9.00% senior notes due 2023
• US$750 million notes due 2026
• US$1.36 billion floating-rate revolving bank loan due June 22, 2023
• US$750 million 7.25% senior notes due Dec. 31, 2025
• US$750 million senior notes due 2027
• US$300 million 7.00% notes due June 1, 2028
• US$600 million 7.75% senior secured notes due Oct. 15, 2024
• US$625 million 6.25% senior notes due Dec. 1, 2024
• US$750 million 5.875% notes due Jan. 15, 2024
• US$600 million 6.125% notes due Aug. 1, 2025
• US$550 million 6.875% notes due Feb. 1, 2027
• US$500 million 5.375% notes due May 15, 2023
• US$863.179 million senior unsecured convertible notes due Jan. 30, 2023
• US$237.993 million senior unsecured convertible notes due Jan. 30, 2027

On Aug. 6, 2020, S&P Global Ratings lowered its long-term issuer credit rating on Switzerland-based offshore drilling contractor Transocean Ltd. to 'SD' from 'CCC' after the issuer opted for an exchange of US$356 million due in 2023 for US$213 million new debt at a higher interest rate. We believed this transaction of extending the maturity date and 40% discount at par was not a good sign for the company's operational performance.

On Sept. 28, 2020, S&P Global Ratings raised the issuer credit rating to 'CCC-' from 'SD' following the debt exchange.

On Oct. 15, 2020, S&P Global Ratings lowered the issuer credit rating to 'CC' and on Nov. 16, 2020, lowered it to 'SD'.

On Nov. 25, 2020, S&P Global Ratings raised the issuer credit rating to 'CCC-' from 'SD' following the debt repurchases.

Table 40

Swissport Group S.a.r.l.

• €250 million 9.00% notes due Feb. 15, 2025
• €410 million 5.25% notes due Aug. 15, 2024
• €900 million floating-rate term bank loan due Aug. 14, 2024
• €290 million 9.75% callable notes due Dec. 15, 2022
• €400 million 6.75% callable notes due Dec. 15, 2021

On Sept. 9, 2020, S&P Global Ratings lowered its long-term issuer credit rating on Luxembourg-based global airport ground handler Swissport Group S.a.r.l. to 'SD' from 'CCC' after the issuer completed issuing €230 million supersenior secured debt for liquidity purposes and was planning to issue another €70 million. The issuer was also planning for a comprehensive debt restructuring involving debt-for-equity swaps.

On Dec. 22, 2020, S&P Global Ratings lowered the rating to 'D' following the debt restructuring. S&P Global Ratings subsequently withdrew the ratings at the issuer's request.

Table 41

Distribuidora Internacional de Alimentacion S.A.

• €300 million 1.00% medium-term notes due April 28, 2021
• €300 million 0.875% medium-term notes serial 3 due April 6, 2023
• €200 million first-lien supersenior secured term bank loan due June 25, 2022

On Sept. 15, 2020, S&P Global Ratings lowered its long-term issuer credit rating on Spain-based food products retailer Distribuidora Internacional de Alimentacion S.A. to 'SD' from 'CC' after the issuer completed a distressed exchange. The leading shareholder, LetterOne, purchased 97.5% of its €300 million 1% notes due 2021 and 76% of its €300 million 0.875% notes due 2023. The shareholder made an offer to purchase the remaining 2023 notes.

On Oct. 9, 2020, S&P Global Ratings raised the issuer credit rating to 'CCC-' from 'SD'. At that point, LetterOne owned 89.7% of 2023 notes.

Table 42

PGS ASA

On Sept. 21, 2020, S&P Global Ratings lowered the long-term issuer credit rating on Norway-based oilfield services provider PGS ASA to 'SD' from 'CCC' after the company missed a principal repayment. The company extended the maturity on its revolving credit facility of US$135 million by one week. The pandemic, low demand, and plunging oil prices pushed the company into a weaker liquidity position, making it difficult to repay the amount. PGS was also in talks with lenders to secure a new capital structure.

Table 43

Technicolor S.A.

• €450 million bank loan due Dec. 6, 2023
• €275 million bank loan due Dec. 6, 2023
• US$300 million bank loan due Dec. 6, 2023
• US$119.779 million term loan bank loan due June 30, 2024
• €191.35 million notes due June 30, 2024
• €158.31 million notes due June 30, 2024

On Sept. 23, 2020, S&P Global Ratings lowered its long-term issuer credit rating on France-based media and entertainment company Technicolor S.A. to 'SD' from 'CC' after the group completed its financial restructuring plan. This included two main components: first, the conversion of about €1.2 billion of debt into a new €574 million facility and €660 million of equity on Sept. 22, 2020, and second, the issuance of €457 million of new debt to repay the US$110 million JP Morgan bridge facility and to support Technicolor's liquidity needs, undertaken in July and September 2020. S&P Global Ratings viewed Technicolor's completed debt-to-equity swap as equivalent to a default.

On Sept. 25, 2020, S&P Global Ratings raised the issuer credit rating to 'CCC+' from 'SD' after liquidity metrics significantly improved and debt fell, with sources of cash exceeding uses by significantly more than 1.5x in the following 12 months.

Table 44

Cassini SAS

• €90 million floating-rate revolving credit facility bank loan due March 8, 2025
• €568 million facility B bank loan due March 28, 2026

On Sept. 28, 2020, S&P Global Ratings lowered its long-term issuer credit rating on French trade show organizer Cassini SAS to 'D' from 'CCC' after the issuer entered into safeguard procedures because of losses caused by COVID-19-related show cancelations and postponements. The safeguard procedure, which we considered tantamount to default, implied the debt of the protected companies was frozen, allowing for a reorganization of liabilities and a grace period.

Table 45

Toro Private Holdings I Ltd.

• US$500 million floating-rate second-lien term bank loan due May 28, 2027
• US$2.8 billion floating-rate first-lien term bank loan due May 29, 2026
• US$150 million floating-rate revolver bank loan due May 30, 2024
• US$1.63 billion bank loan due Feb. 28, 2025

On Oct. 1, 2020, S&P Global Ratings lowered its long-term issuer credit rating on U.K.-based transportation company Toro Private Holdings I Ltd. to 'SD' from 'CC' after the company completed the announced debt exchange and restructuring, which we viewed as distressed and tantamount to default because lenders received less than the original promise of the debt instruments.

On Oct. 2, 2020, S&P Global Ratings raised its issuer credit rating to 'CCC+' from 'SD'.

Table 46

Mallinckrodt PLC

• US$900 million floating-rate revolving facility bank loan due March 19, 2022
• US$900 million 5.75% unsecured notes due Aug. 1, 2022
• US$700 million 5.50% senior notes due April 15, 2025
• US$750 million 5.625% notes due 2023
• US$1.862 billion floating-rate term B bank loan due Sept. 24, 2024
• US$600 million floating-rate term bank loan due Feb. 24, 2025
• US$600 million 4.75% senior unsecured notes due April 15, 2023

On Oct. 13, 2020, S&P Global Ratings lowered its long-term issuer credit rating on Ireland-based manufacturer and distributer of specialty pharmaceutical products Mallinckrodt PLC to 'D' from 'CCC' after the issuer announced that it voluntarily initiated Chapter 11 proceedings in the U.S. Bankruptcy Court for the District of Delaware to modify its capital structure, including to restructure portions of its debt and resolve several billion dollars of potential legal liabilities.

Table 47

Codere S.A.

• €500 million 6.75% notes due Nov. 1, 2021
• US$300 million 7.625% notes due Nov. 1, 2021
• €85 million 12.75% notes due Sept. 30, 2023
• €165 million 10.75% notes due Sept. 30, 2023

On Oct. 15, 2020, S&P Global Ratings lowered its long-term issuer credit rating on Spain-based private gaming service provider Codere S.A. to 'SD' from 'CCC' after a scheme of arrangement was approved by the courts, with 99.6% of creditors participating in the scheme voting in favor.

On Nov. 6, 2020, S&P Global Ratings raised the issuer credit rating to 'CCC' from 'SD' on completion of the restructuring.

Table 48

SAS AB

On Oct. 28, 2020, S&P Global Ratings lowered its long-term issuer credit rating on Sweden-based passenger flight transportation services company SAS AB to 'SD' from 'CC' after the issuer completed a distressed debt restructuring of its Swedish krona (SEK) 2.3 billion senior unsecured bond due 2022 into about 547 million common shares, at SEK1.16 per share. The remaining SEK1.6 billion was converted into new hybrid notes. In addition, at the same share price, SAS offset SEK1.5 billion of subordinated perpetual capital securities with about SEK1.2 billion of common shares.

On Dec. 7, 2020, S&P Global Ratings raised the issuer credit rating to 'B-' from 'SD' on improved liquidity with constraints from high leverage.

Table 49

Selecta Group B.V.

• €150 million floating-rate supersenior revolving credit facility bank loan due Aug. 2, 2023
• €765 million 5.875% notes due Feb. 1, 2024
• €325 million callable notes due Feb. 1, 2024
• CHF250 million 5.875% callable notes due Feb. 1, 2024

On Oct. 28, 2020, S&P Global Ratings lowered its long-term issuer credit rating on the Netherlands-based self-service retail and coffee services company Selecta Group B.V. to 'SD' from 'CC' after the England and Wales High Court sanctioned the scheme of arrangement proposed by pan-European vending machine operator Selecta Group B.V. and backed by the group's creditors.

On Oct. 30, 2020, S&P Global Ratings raised the issuer credit rating to 'CCC+' from 'SD' following the completion of the distressed exchange.

Table 50

Hema B.V.

• €100 million floating-rate supersenior revolving credit facility bank loan due Jan. 10, 2022
• €600 million floating-rate notes due July 15, 2022
• €150 million 8.50% notes due Jan. 15, 2023

On Oct. 30, 2020, S&P Global Ratings lowered its long-term issuer credit rating on Netherlands-based general merchandise retailer Hema B.V. to 'SD' from 'CC' after the issuer completed a distressed debt restructuring transaction on Oct. 19, 2020. The amount of the senior secured notes was half of the original €600 million, and the senior unsecured noteholders had not received any of the €150 million they invested.

On Nov. 3, 2020, S&P Global Ratings raised the issuer credit rating to 'CCC+' from 'SD' after the company completed the distressed exchange.

Table 51

Pacific Drilling S.A.

On Oct. 30, 2020, Luxembourg-based offshore drilling contractor Pacific Drilling S.A. filed for bankruptcy under Chapter 11 of the U.S. Bankruptcy Code, which S&P Global Ratings considers a default.

Earlier, on June 9, 2020, we withdrew the issuer credit ratings at the issuer's request.

Table 52

Bahia de las Isletas S.L.

On Nov. 11, 2020, S&P Global Ratings lowered its long-term issuer credit rating on Spain-based transportation company Bahia de las Isletas S.L. to 'SD' from 'B-' after the issuer missed the Oct. 31 coupon payment on its senior secured notes due 2023.

Table 53

Haya Real Estate S.A.U.

• €250 million 5.25% notes due Nov. 15, 2022
• €225 million floating-rate notes due Nov. 15, 2022

On Nov. 26, 2020, S&P Global Ratings lowered the long-term issuer credit rating on Spain-based real estate debt and property management company Haya Real Estate S.A.U. to 'SD' from 'CC' following a distressed exchange. The issuer used €43 million of cash proceeds to repurchase €51 million of notes. A fixed-rate loan and floating-rate loans were repurchased at 85% and 84.875% of the original price, respectively. As a result, the noteholders received less than the original promise.

On Dec. 10, 2020, S&P Global Ratings raised the issuer credit rating to 'CCC+' from 'SD' following the company's debt repurchase.

Table 54

Cineworld Group PLC

• US$450 million bank loan due May 23, 2024
• US$110.8 million bank loan due May 23, 2024
• US$3.325 billion floating-rate dollar term bank loan due Feb. 28, 2025
• US$462.5 million floating-rate revolving credit facility bank loan due Feb. 28, 2023
• €607.643 million floating-rate euro term bank loan due Feb. 28, 2025
• US$650 million floating-rate term bank loan due Sept. 30, 2026
• US$250 million term loan B due June 22, 2023

On Nov. 26, 2020, S&P Global Ratings lowered its long-term issuer credit rating on U.K.-based cinema operator Cineworld Group PLC to 'SD' from 'CCC-' following a distressed debt issuance transaction. The group issued a US$450 million senior secured term loan and US$111 million senior secured term loan due May 2024 and refinanced the US$111 million additional revolving credit facility that was maturing in December 2020.

On Nov. 27, 2020, S&P Global Ratings raised the issuer credit rating to 'CCC' from 'SD' following the company's debt issuance.

Table 55

Europcar Mobility Group S.A.

• €500 million floating-rate multicurrency revolving credit facility bank loan due June 9, 2022
• €600 million 4.125% notes due Nov. 15, 2024
• €450 million 4.00% notes due April 30, 2026
• €500 million 2.375% callable notes due Nov. 15, 2022
• €220 million guaranteed unsecured term loan due May 3, 2021

On Dec. 2, 2020, S&P Global Ratings lowered its long-term issuer credit rating on France-based car rental service provider company Europcar Mobility Group S.A. to 'SD' from 'CC' after the issuer elected not to pay the interest due on its 2024 and 2026 corporate senior notes prior to the end of the 30-day grace period. The group entered into a forbearance agreement with its bondholders, such that they will not take any enforcement action with respect to the nonpayment of interest payments on the 2026 notes that were due Oct. 30, 2020, or on the 2024 notes that were due Nov. 16, 2020.

Table 56

Zellis Holdings Ltd.

• £260 million facility B bank loan due Dec. 5, 2024
• £40 million revolver bank loan due Dec. 5, 2023

On Dec. 2, 2020, S&P Global Ratings lowered its long-term issuer credit rating on U.K.-based payroll software provider Zellis Holdings Ltd. to 'SD' from 'CCC+'. The company effectively converted its existing £270 million first-lien term loans from paying cash interest to paying interest as part cash, part PIK over the next three years and its £20 million second-lien term loans from paying cash interest to all PIK until maturity, with unanimous lender approval. As part of the exchange, current owner Bain Capital made a £40 million equity contribution.

On Dec. 9, 2020, we raised the issuer credit rating to 'CCC+' from 'SD' following the distressed conversion of term loans to PIK toggle.

Table 57