Fitch puts Yingde Gases on negative watch

Fitch Ratings said it placed Yingde Gases Group Co. Ltd.'s long-term issuer default rating and senior unsecured rating of B+ on Rating Watch negative.

The negative watch follows a delay to the company’s proposed equity placement that it announced in November and this raises uncertainties about its ability to repay offshore bank loans due Jan. 3 2017, Fitch explained.

The agency also said it removed the Rating Watch positive placed on Yingde's ratings due to the delay in the proposed equity placement, which was expected to raise net proceeds of HK$1.2 billion.

An open letter to shareholders Dec. 12 by Yingde's former chairman made public a dispute between shareholders and the company, Fitch said.

The agency said it believes the dispute is likely to complicate the process of completing the share placement.

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