Moody's Ratings has placed under review for a possible upgrade the corporate family rating (Corporate Family Rating, CFR) of Bahía de las Isletas, S.L. —the parent of Naviera Armas—, currently situated at Caa2. The measure also affects the default probability rating (Caa2-PD) and the senior secured bonds issued by ANARAFE, S.L.U., whose rating remains at Caa3. So far, the outlook for all these ratings was negative.
The review comes after the announcement made by Naviera Armas on August 25, in which it communicated the signing of binding agreements for the sale of all its operations, as part of a restructuring process affecting both its maritime routes and its land transport division.
The first of the agreements involves the transfer to Baleària Eurolíneas Marítimas S.A. of the routes, operational assets, and staff associated with the services between the Canary Islands, the Peninsula, Algeria, and the Alborán Sea, as well as the land logistics activity. The agreed amount is 215 million euros, free of debt. The second agreement implies the sale to the Danish shipping company DFDS A/S of the assets linked to routes between southern Spain and Morocco, including ships and assigned personnel, for a total of 40 million euros. In parallel, the company has signed a Memorandum of Understanding for the sale of the ship Fortuny to the Italian Liberty Lines for 25 million euros.
According to Moody's, these operations would allow Naviera Armas to generate revenues close to 280 million euros, an amount that approaches the total outstanding debt, estimated at 293 million euros by April 30, 2025. The debt structure includes a super senior secured loan, a mortgage on port assets, senior secured bonds issued by ANARAFE, S.L.U., and unsecured senior bank debt.
In the agency's view, if the operations are completed on the agreed terms, there is a possibility that the recovery rate for creditors, particularly for holders of secured bonds, may be higher than currently contemplated in the rating Caa3. However, Moody's clarifies that this hypothesis is preliminary and will depend on the effective execution of the sales and the authorization schedule by the competition authorities.
In this context, Moody's warns that the lack of visibility over regulatory timelines could delay the completion of the transactions. In any case, once the operations are concluded and most of the debt is amortized, the agency expects to proceed with the withdrawal of the shipping company's credit ratings.
Regarding the financial structure, Moody's maintains a lower rating for the senior secured bonds of ANARAFE —194 million euros maturing in December 2026— due to its subordination to the super senior loan of 47 million euros, which limits its degree of protection in case of default.
Concerning liquidity, the company presents a fragile position. As of April 2025, Naviera Armas had 31 million euros in cash, of which 17 million was classified as restricted funds. This situation, along with the heavy financial burden and uncertainty over operating cash flows, reinforces the need to execute divestitures to stabilize its credit profile.
In the area of corporate governance, Moody's highlights that historical problems associated with operations with related parties, particularly with members of the founding family, have had a negative impact on the company's credit quality. Although the agency values that the current board of directors has put an end to such practices, complex contractual relationships persist: Naviera Armas has five vessels leased to special purpose vehicle (SPV) companies that, in turn, owe it more than 60 million euros.
Based in Las Palmas de Gran Canaria, Naviera Armas is one of the main operators of maritime transport of passengers and goods in Spain. At the end of 2024, it had a fleet of 19 ships and also managed one of the largest road transport networks in the country, with more than 500 vehicles. During that fiscal year, the company recorded revenues of 519 million euros and an adjusted EBITDA by Moody's of 30 million.
The agency applied its specific methodology for the shipping sector, published in June 2021, as the basis for this rating review. The outcome of this review will depend on the effective execution of the announced sales and the final use of the funds obtained.