S&P lowers HMS Hydraulic

Standard & Poor’s said it lowered the long-term corporate credit rating on HMS Hydraulic Machines and Systems Group plc to B- from B and placed it on CreditWatch with negative implications.

The agency also said it lowered the rating on the RUB 5.1 billion currently outstanding notes issued by subsidiary CJSC Hydromashservice to CCC+ from B- and placed it on CreditWatch negative.

The recovery rating on the notes is unchanged at 5, indicating 10% to 30% expected default recovery.

The downgrades reflect a view that there are increasing risks regarding the refinancing of RUB 2.1 billion of senior unsecured bonds due in February 2015, S&P said.

HMS currently faces tough operating conditions, weak economic prospects in Russia and geopolitical tensions, which may lead to more restricted access to bank- and debt-capital markets, the agency said.

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