S&P lowers Yida China

S&P said it downgraded Yida China Holdings Ltd. to CC from CCC and its senior unsecured notes to C from CC. The outlook is negative.

The company plans to issue new notes in exchange for its notes due in April 2020. Under the terms of the offer, Yida will issue new senior notes of up to $276 million due 2022 for most of its $300 million of 6.95%senior notes due in April. The new notes will carry an interest rate of 10% per annum for the initial six months, rising to 14% per annum for the remaining 18 months.

“We lowered the rating on Yida because we view the proposed transaction as a distressed exchange rather than an opportunistic one. We believe the company is highly likely to default on its notes in the absence of a successful exchange offer. Yida has a low cash balance and few viable near-term refinancing options,” said S&P in a press release.

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