OREANDA-NEWS. Fitch Ratings has downgraded French apparel and footwear retail group Novartex SAS's (Vivarte) Long-term Issuer Default Rating (IDR) to 'CC' from 'CCC'. At the same time, the agency has downgraded Vivarte SAS's super senior debt to 'CCC-'/RR3 (55% recovery) from 'B-'/RR2 (75%) and Novarte SAS's EUR780m reinstated debt to 'C'/RR6 (0%) from 'CC'/RR6 (0%).

The downgrades follow management's public comments that it is discussing a new debt restructuring, reflecting the limited options available outside of the potential conversion of part of the group's debt into equity to address an over-leveraged balance sheet. During these restructuring talks, Vivarte remains within the terms of its liquidity covenant and will continue to service its debt.