Moody's rates Norilsk Nickel notes Baa2

Moody's Investors Service said it assigned a provisional Baa2 rating to the proposed loan participation notes to be issued by, but with limited recourse to, MMC Finance Ltd., with proceeds on-lent to OJSC MMC Norilsk Nickel.

Moody's also said it affirmed Norilsk Nickel's Baa2 issuer rating.

The outlook is stable.

Given that MMC Finance will issue the notes for the sole purpose of financing a loan to Norilsk Nickel under a loan agreement between the two entities, the noteholders are relying solely on Norilsk Nickel's credit quality to service and repay the debt, Moody's said.

It is anticipated that Norilsk Nickel will use the proceeds from the loan to refinance its existing indebtedness and for general corporate purposes, the agency said.

The rating assigned to the notes is in line with Norilsk Nickel's issuer rating, which balances the company's position as the world's largest producer of nickel and palladium, competitive low-cost profile, extensive reserves and an expectation that it will be able to maintain a dividend policy congruent with the base-metals market, Moody' s said.

The rating also considers the company's global footprint in selected metals, low-cost production profile and long-life reserve base of nickel, the agency said.

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