S&P rates EuroChem BB-

Standard & Poor's said it assigned its BB- long-term corporate credit rating and ruAA- Russia national scale rating to EuroChem Mineral and Chemical Co. OJSC, and assigned its BB- long-term rating to EuroChem Finance plc's proposed participation notes. The rating is subject to final documentation.

The outlook is stable.

The ratings reflect the group's exposure to the cyclical markets and margins of fertilizers and other base chemicals, S&P said, and an expected lack of free operating cash flow generation in the next few years because of significant capital expenditure on expansion in potash.

This is partially offset by access to cheap gas and electricity in Russia, a moderate debt burden before major investments start and efficiency efforts that should continue to support margins and sales, the agency added.

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