Fitch rates Yunnan notes BBB

Fitch Ratings said it assigned Yunnan Provincial Energy Investment Group Co., Ltd.'s (YEIG, BBB/stable) proposed dollar-denominated notes an expected rating of BBB(EXP).

The bonds will be issued by Yunnan Energy Investment Overseas Finance Co. Ltd. – an effectively wholly owned offshore subsidiary of YEIG.

YEIG is entering into a keepwell deed and a deed of equity interest purchase and investment undertaking to provide credit support to the notes.

Fitch said the BBB rating is credit linked to, but not equalized with, the agency’s internal credit assessment of Yunnan province, based on strong parent-subsidiary linkage.

“YEIG broadened its role in 2016 by taking the role of the mandated provincial state-owned enterprise (SOE) to develop the province's natural-gas market and power-distribution grid; this is in addition to its role of holding shares in major hydropower assets on behalf of the Yunnan government and developing the province's power capacity,” the agency said in a news release.

“YEIG also acquired a controlling stake in listed company, Yunnan Energy Investment Co., Ltd., which owns the provincial salt production and distribution platform.”

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.