Fitch rates Oceanwide bonds B

Fitch Ratings said it assigned a final rating of B to Oceanwide Holdings Co., Ltd.’s $320 million 11¾% guaranteed senior unsecured bonds due 2019 with a recovery rating of RR4.

The issuer of the proposed bonds is Oceanwide Real Estate International Holding Co. Ltd., an offshore entity.

The bonds are guaranteed by Oceanwide and its offshore 100%-owned subsidiary, Oceanwide Holdings (Hong Kong) Co., Ltd.

Oceanwide’s onshore parent company, China Oceanwide Holdings Group Co., Ltd., which owns 73.67% of Oceanwide, will provide a keepwell deed to ensure sufficient liquidity for timely payment of the bonds.

The notes are rated at the same level as Oceanwide’s senior unsecured rating as they represent direct, unconditional, unsecured and unsubordinated obligations of the company.

The company’s solid asset value and higher margins than peers provide it with substantial financial flexibility, Fitch said.

Oceanwide is likely to gradually diversify its business model from pure property development to financial institutions in the long term, the agency said.

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