Fitch: Hochschild notes BB+

Fitch Ratings said it assigned an initial long-term foreign-currency issuer default rating and an initial long-term local-currency issuer default rating of BB+ to Hochschild Mining plc.

Fitch said it assigned an expected BB+ rating to Hochschild's proposed senior unsecured notes of up to $350 million due 2020/2023.

The senior unsecured notes will be issued through the company's 100% owned subsidiary in Peru, Compania Minera Ares SAC.

The unsecured notes will be fully and unconditionally guaranteed, jointly and severally, by Hochschild and its subsidiaries Minera Suyamarca SAC, Hochschild Mining (Argentina) Corp. SA, Hochschild Mining plc and Minas Santa Maria de Moris, SA de CV.

The proceeds will be used to finance the planned $280 million acquisition of the 40% stake in Minera Suyamarca in Peru that is currently owned by International Minerals Corp. of Canada, taking Hochschild's ownership in this subsidiary to 100%, Fitch said.

Minera Suyamarca is the holding company for the Pallancata unit and the Immaculada project. The remainder of the proceeds will be used towards other general corporate purposes, including the repayment of the $115 million convertible bond due 2014 issued by the company in 2009.

The agency said the company's historically conservative leverage is expected to remain low.

The company also has a strong historical track record of very low leverage ratios, a common feature among Peruvian mining companies, Fitch said.

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