(Bloomberg) -- Swedish debt collector Intrum AB saw its credit rating cut one step to CCC by Fitch Ratings given there is a “materially increased” possibility that the company’s looming refinancing could be viewed as a distressed debt exchange.

The firm’s “high leverage, its currently restricted access to debt-capital markets and near-term pressure to conclude its discussions with creditors” underscore the risks for bondholders, Fitch said in a report on Tuesday.

The shares dropped as much as 5.8% in early trading in Stockholm. 

On March 14, Intrum announced it had appointed financial advisers to address its debt structure, sending the shares down as much as 18% in Stockholm trading. The company has sufficient liquidity to fully repay its nearest material debt maturity, a €469 million ($503 million) bond due on July 15, Fitch also noted.

Intrum’s bonds maturing in August 2025 are currently quoted at distressed levels of 76.75 euro cents, according to data compiled by Bloomberg. Its shares have slumped 61% this year, giving the firm a market value of $313 million.

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