S&P upgrades Intime Retail

S&P said it raised the long-term corporate credit rating on Intime Retail (Group) Co. Ltd. to BBB- from BB-.

The outlook is stable.

The agency also said it raised the long-term Greater China regional scale rating on Intime to cnA- from cnBB+.

S&P also said it removed the ratings from CreditWatch, where they were placed with positive implications in January.

The agency also said it upgraded the rating because it expects Intime to benefit from extraordinary group support from its new controlling shareholder, Alibaba Group Holding Ltd.

Following the approval of the privatization by Alibaba Investment, a wholly-owned subsidiary of Alibaba Group, its founder Shen Guojun and other joint offerors, Alibaba will hold a majority 73.9% stake in the company and expects to carry out its strategic integration plans with Intime, S&P explained.

Intime is considered strategically important to Alibaba Group, and therefore incorporate three notches of uplift in the rating on the department store operator.

One notch is because Intime is important to the group's long-term strategy despite its limited financial contribution to the overall group.

One notch is because Intime will reinforce Alibaba's strategy of integrating online and offline platforms, given Intime's store network of department stores and shopping malls in the Zhejiang province.

And the third notch is due to its importance to the group's strategy and that it is unlikely to be sold given Alibaba's HK$12.5 billion investment for the privatization.

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