S&P downgrades West China Cement

S&P said it lowered the long-term corporate credit rating on West China Cement Ltd. to B from B+.

The agency also said it lowered the rating on the company’s outstanding senior unsecured notes to B from B+.

S&P also said it lowered the long-term Greater China regional scale rating on West China Cement and the notes to cnB+ from cnBB.

The agency also said it removed all of the ratings from CreditWatch, where they were placed with positive implications in November 2015.

The outlook is negative.

The downgrades are due to a belief that the company’s liquidity risks have risen following the termination of a potential takeover by Anhui Conch Cement Co. Ltd., S&P said.

West China Cement may encounter a less favorable market for its short-term maturities, which include commercial paper with less than one year, given that lenders and investors have become cautious about borrowers operating in sectors with surplus capacity, the agency explained.

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