Moody’s applies Ba3 to Gemdale bonds

Moody's Investors Service said it assigned a Ba3 senior unsecured rating to the proposed bonds to be issued by Gemdale Ever Prosperity Investment Ltd., a wholly owned subsidiary of Famous Commercial Ltd. (Ba3 stable).

The outlook is stable.

The proposed bonds will be guaranteed by Famous. They are also supported by a deed of equity interest purchase undertaking and a keepwell deed between Famous, Gemdale Corp. (Ba2 stable) and the bond trustee.

Proceeds will be used to refinance Gemdale group's existing debt and for general corporate purposes.

"The proposed bond issuance will not have a material impact on either Gemdale Corp.’s or Famous' credit metrics, because the proceeds will largely be used to repay Gemdale group's existing debt," Moody's vice president and senior credit officer Kaven Tsang said in a news release.

In addition, the proposed issuance will moderately lengthen the companies' debt maturity profile, the agency noted.

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