Moody’s revises Guangzhou view to negative

Moody's Investors Service said it changed the outlook of Guangzhou R&F Properties Co., Ltd.'s (Guangzhou R&F) Ba2 corporate family rating and R&F Properties (HK) Co. Ltd.'s (R&F HK) Ba3 corporate family rating to negative from stable.

The agency also changed the outlook of the Ba3 senior unsecured ratings assigned to the notes issued by Caifu Holdings Ltd. and Trillion Chance Ltd. to negative from stable. The bonds are unconditionally and irrevocably guaranteed by R&F Properties, and supported by Guangzhou R&F through Keepwell Deed and Deed of Equity Interest Purchase Undertaking.

R&F Properties is a wholly owned subsidiary of Guangzhou R&F, and both Caifu and Trillian Chance are wholly owned by R&F Properties.

At the same time, Moody's affirmed Guangzhou R&F's Ba2 corporate family rating, R&F Properties’ Ba3 corporate family rating and the Ba3 ratings for the senior unsecured notes issued by Caifu and Trillion Chance.

"The change in outlook to negative from stable has been prompted by Guangzhou R&F's weaker-than-expected financial results for 1H2014, as evidenced by the substantial increase in debt leverage and the weakening in interest coverage," Moody's vice president and senior analyst Kaven Tsang said in a news release.

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