Moody's rates Evergrande notes B2

Moody's Investors Service said it assigned a B2 rating to the dollar-denominated senior notes proposed by Evergrande Real Estate Group Ltd. The outlook is negative.

The proceeds will be used to refinance existing debt.

The proposed issue will help improve Evergrande's weak liquidity profile, but it will not have a material impact on Evergrande's debt leverage, which is already at a high level for its rating, Moody’s said.

The negative outlook reflects the agency’s concerns about Evergrande's weak credit metrics – which could pressure its current rating – and its higher level of investment in non-property businesses.

At the same time, Evergrande's operating performance remains strong, as evidenced by its robust contracted sales growth, the agency said.

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