Moody’s continues Citic review

Moody's Investors Service said it will continue its review for upgrade on the following:

• Citic Group Corp.’s Baa2 senior unsecured bond rating;

• Citic Pacific Ltd.’s Ba2 corporate family rating and senior unsecured bond rating and the provisional Ba2 rating on its medium-term note program; and

• Citic Resources Holdings Ltd.’s Ba3 corporate family rating

The review was initiated on March 27 after Citic Pacific announced that it was in discussions with its ultimate parents, Citic Group and Beijing Citic Enterprise Management Co., Ltd, (unrated), to fully acquire Citic Ltd. (unrated).

"Our review for upgrade on Citic Pacific's ratings reflects our expectation that the acquisition of Citic Ltd. will greatly increase Citic Pacific's scale and enhance its credit profile. Citic Pacific will hold around 97%, 88% and 98% of the group's assets, revenue, and profits, respectively, after the acquisition. As a result, Citic Pacific's rating will likely be upgraded to the same level of Citic Group, given the close linkage and similar credit profiles of the two entities," Moody's vice president and senior analyst Joe Morrison said in a news release.

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