Moody’s assigns Evraz notes Ba3

Moody's Investors Service said it assigned at Ba3 corporate family rating and Ba3-PD probability of default rating to Evraz North America Ltd. (ENA).

At the same time, the agency assigned a Ba3 rating to Evraz Inc. NA Canada's (Evraz Canada) proposed $500 million senior secured notes. The notes will be guaranteed by Evraz Canada’s parent – ENA – and by Evraz Inc. NA (EINA) and other subsidiaries of the parent.

The outlook is stable.

The notes will be secured by a first lien on Evraz Canada and the guarantors' fixed and intangible assets and a second lien on the assets securing the asset-based credit facility (ABL - principally accounts receivable and inventory).

Proceeds will be used to repay about $495 million in intercompany loans to Evraz plc, the ultimate parent of ENA. The remaining roughly $280 million in parent intercompany loans will be subordinated to the notes and the ABL. Moody's previous rating on the entities that comprise EINA and Evraz Canada was withdrawn in October 2010.

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