Fitch gives BB- to Sunac notes

Fitch Ratings said it assigned Sunac China Holdings Ltd.’s (BB-/positive) proposed dollar-denominated senior unsecured notes an expected rating of BB-(EXP).

Proceeds will be used for refinancing existing debt.

Fitch estimates Sunac to have achieved around RMB 16 billion of contracted sales on an attributable basis in the first half of 2014. While the year-on-year growth is limited, it reflects the sustainability of the company's business scale in the difficult conditions in China's homebuilding sector.

Sunac's operating scale also demonstrates superior management, a more stable operating cash flow and more cost benefits compared with peers rated at BB-.

The agency uses attributable sales, the share of sales contributions from a company's ownership in joint ventures, as one of the criteria to assess the business scale of companies with substantial joint ventures.

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