S&P downgrades China Shanshui Cement

Standard & Poor’s said it lowered the long-term corporate credit rating on China Shanshui Cement Group Ltd. to CC from CCC.

The outlook is negative.

The agency also said it lowered the rating on the company’s outstanding senior unsecured notes to CC from CCC-, along with its long-term Greater China regional scale ratings to cnCC from cnCCC and the rating on its notes to cnCC from cnCCC-.

The downgrades reflect the high likelihood that the company will not repay its RMB 2 billion onshore super short-term commercial-paper due Nov. 12, S&P said.

A failure to repay this debt would trigger a cross-default of the company’s other financial obligations, including that of its outstanding U.S. dollar notes, the agency said.

S&P said it believes a shareholders’ dispute over the company’s board members has damaged the company’s funding ability and operations.

The company’s largest shareholder, Tianrui (International) Holding Co. Ltd., continues to push for the replacement of the existing board at extraordinary general meetings, the agency said.

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