Fitch: Zhanglong bonds BB+

Fitch Ratings said it assigned an expected BB+ rating to Fujian Zhanglong Group Co., Ltd.'s proposed tap of its dollar-denominated senior unsecured bonds.

The tap issuance will carry the same terms and conditions as the earlier issuance of $300 million of 4½% notes due 2019.

The offshore notes will be issued directly by Zhanglong with the proceeds used for working capital and general corporate purposes, the agency said.

The notes are rated at the same level as Zhanglong's issuer default rating and constitute its direct, unconditional, unsubordinated and unsecured obligations and rank at least pari passu with all its other present and future unsecured obligations, Fitch said.

Zhanglong is wholly owned by the Zhangzhou State-Owned Assets Supervision and Administration Commission (Sasac) and is supervised by Zhangzhou municipality, the agency said.

Zhanglong's ratings are credit-linked with, but not equalized to, Fitch's internal credit assessment of Zhanglong municipality, Fitch said.

This link reflects strong municipal control and oversight, its strategic importance to the municipality and integration with the government budget and legal status, the agency said.

This means there is a high likelihood of extraordinary support for the company, if needed, from the municipality, Fitch said.

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