Moody’s applies Ba1 to NLMK LPNs

Moody's Investors Service said it assigned a Ba1 rating (LGD 3) to the senior unsecured loan participation notes to be issued by Steel Funding Ltd. for the sole purpose of financing a loan to NLMK (Ba1 negative).

NLMK intends to use the proceeds primarily to finance the repurchase of part of Steel Funding's existing $800 million notes due 2018 and $500 million notes due 2019, under the tender offer announced on May 31.

Moody’s said the Ba1 rating reflects its assumption that: (a) The notes will rank pari passu with other senior unsecured debt of NLMK group, including the existing Steel Funding's $800 million and $500 million notes, both rated Ba1; and (b) the new notes' placement will not result in any material change in NLMK group's total debt, as the proceeds will be primarily used for refinancing existing debt.

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