S&P stabilizes Jiangsu Shagang outlook

S&P said it revised its outlook for Jiangsu Shagang Group Co. Ltd. to stable from positive and affirmed its BBB- issuer rating.

“We no longer expect Shagang's credit metrics to support a higher rating over the next 12 months,” S&P said in a press release.

Specifically, the agency cited the delay in Shagang’s slower-than-expected disposal of its stake in data center provider Global Switch and weaker earnings from the steel business will delay the company's plans to lower leverage. The delay was not the company's fault, but Global Switch’s value has weakened as interest costs climbed.

Should the deal occur, S&P said it would re-evaluate the effect on Shagang’s ratings.

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