Moody's rates China Three Gorges notes A1

Moody's Investors Service said it assigned an A1 senior unsecured rating to the proposed senior unsecured notes to be issued by Three Gorges Finance II (Cayman Islands) Ltd., a wholly owned subsidiary of China Three Gorges Corp.

The senior unsecured notes will be unconditionally and irrevocably guaranteed by China Three Gorges, Moody's said.

The outlook is stable.

The proceeds will be used to fund certain eligible green projects, the agency said.

The ratings are underpinned by the company's sound standalone credit profile as the world's leading hydropower company and an expectation of a very high level of support from the Chinese government if needed, Moody's explained.

The ratings also consider the company's baseline credit assessment of Baa2 and a four-notch uplift to reflect the very high level of expected support from the Chinese government, the agency explained.

Moody's said there is an expectation of a very high level of government support if needed based on the full government ownership of the company and due to its highly strategic importance to China's clean energy development, water conservation and urbanization.

The ratings are also are underpinned by its leading position in China's and global hydropower industry, the agency said.

The ratings are constrained by the social and environment risks associated with its large-scale hydro projects, Moody's added.

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