S&P cuts China cement companies

Standard & Poor's said it downgraded various ratings on China Shanshui Cement Group Ltd. and West China Cement Ltd. (WCC).

The agency said it lowered Shanshui's corporate credit rating to BB/negative from BB/stable and lowered its Greater China regional scale rating to cnBB+ from cnBBB-.

The agency also lowered West China Cement's corporate credit rating to B+/negative form BB-/negative and lowered its Greater China regional scale rating to cnBB- from cnBB.

Additionally, S&P affirmed the BB- issue rating on Shanshui's outstanding senior unsecured notes and lowered its Greater China regional scale issue rating on the notes to cnBB from cnBB+.

The agency also lowered its issue rating on West China Cement's senior secured notes to B+ from BB- and its Greater China regional scale issue rating on the notes to cnBB- from cnBB.

"We lowered the rating on WCC to reflect our view of the company's weakened liquidity position, given its low cash balance and high short-term debt," said S&P credit analyst Lawrence Lu in a news release.

"We revised the outlook on Shanshui to reflect our view that the company's high debt burden is unlikely to ease over the next six to 12 months given challenging industry conditions," said Lu.

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