Fitch lowers Interpipe to C

Fitch Ratings said it downgraded Interpipe Ltd.'s long-term issuer default rating and senior secured rating (applicable to the company's 2017 eurobonds) to C from CCC. The recovery rating is RR4.

Fitch said the downgrade reflects its view that Interpipe is unlikely to have sufficient liquidity to meet the scheduled principal debt repayment of $106 million due on the Nov. 1, 2013. Interpipe's liquidity constraints largely stem from the operational impact of the non-renewal of the previous Customs Union quota for Ukrainian pipe exports to Russia. Exports above the quota are subject to a customs duty of at least 19%, making sales into Russia only marginally profitable, the agency said.

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