Fitch assigns B+ to Ittahad, sukuk

Fitch Ratings said it assigned Ittihad International Investment LLC a first-time expected long-term issuer default rating of B+ and expected senior unsecured debt ratings of B+/RR4. Concurrently, Fitch assigned expected B+/RR4 ratings to Ittihad's planned sukuk trust certificates to be issued through Ittihad International Ltd.

The outlook is stable.

“The ratings reflect Ittihad's high but improving leverage, and moderately negative free cash flow (FCF) as working capital (WC) normalizes. Rating strengths are a strong regional presence in paper, cement, building materials and copper production, with a competitive position in the local market,” Fitch said in a press release.

The agency added, “The expected IDR and the senior unsecured debt rating reflect Fitch's expectation that the sukuk issues will be used to refinance debt at various groups and subsidiaries. The final ratings are reliant on the partial refinancing of its senior secured debt and partial release of encumbered assets.”

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