(Finance) – Fitch Ratings assigned to Reno de Medici (RDM), leader in Italy in the production of recycled cardboard, a Long-Term Issuer Default Rating of “B+” with a stable outlook. At the same time, Fitch withdrew the rating of Rimini Bidco, a company controlled by Apollo Global Management and which had been used to revoke the shares from Piazza Affari in 2021, as the reverse merger of the group with RDM was completed and the entity ceased to exist.
The rating, we read in a note, is bound by limited geographic diversification, small scale of operations and lack of vertical integration. THE strengths of the rating are instead a strong market position in the European recycled cardboard markets and a high exposure to resilient end markets such as food and beverage.
The stable outlook is driven by an improving business profile due to RDM’s acquisition of Fiskeby, resulting in increased revenue growth opportunities. This is offset by weaker free cash flow (FCF) generation and a higher leverage profile than previously expected, due to low volumes and increased acquisition debt.