Moody's rates Maoye notes Ba2

Moody's Investors Service said it assigned a provisional Ba2 rating to the senior unsecured dollar-denominated notes to be issued by Maoye International Holdings Ltd.

At the same time, the agency withdrew the provisional Ba2 rating for Maoye's senior unsecured RMB notes.

The outlook is stable.

About 60% of the bond proceeds will be used to refinance RMB3.1 billion of onshore bank loans. The remaining proceeds will be used for general corporate purposes.

Moody's will remove the provisional status of the notes after Maoye completes the issuance on satisfactory terms and conditions.

"The Ba1 corporate family rating (CFR) primarily reflects Maoye's leading market position in Shenzhen, as well as its track record of successfully executing its low-cost expansion strategy in fast growing second- and third-tier cities in southwest and northern China," Moody's vice president and senior analyst Lina Choi said in a news release.

The proposed notes will improve Maoye's debt maturity profile and provide some cost savings, as the cost of the proposed offshore bonds will be lower than the company's existing onshore loans, the agency said.

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