S&P rates Franshion Brilliant notes BBB-

S&P said it assigned a BBB- long-term issue rating to a proposed issuance of Chinese renminbi-denominated offshore senior unsecured notes by Franshion Brilliant Ltd.

The parent company, China Jinmao Holdings Group Ltd. guarantees the notes.

The offshore senior unsecured notes rating the same as the corporate credit rating on China Jinmao because, S&P said, it considers the subordination risk to be limited.

The agency said it expects priority debt to be less than 50% of the group's total consolidated debt at the end of 2017.

The priority debt comprises secured debt and subsidiary-level unsecured debt, S&P said.

The agency said it also believes the government support for China Jinmao's parent company, Sinochem Group, will flow through and largely mitigate the subordination risk.

The proceeds will be used for refinancing existing debt, given the number of maturing onshore bank loans and project loans in the first half of 2018, S&P said.

The company's debt level and leverage are expected to be largely unaffected by the new issuance, the agency said.

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