Moody’s rates Bluestar Finance debt Baa2

Moody's Investors Service said it assigned a provisional Baa2 rating to the senior perpetual securities to be issued by Bluestar Finance Holdings Ltd., a wholly owned subsidiary of China National Bluestar (Group) Co., Ltd. (Bluestar, Baa2 stable).

The perpetual securities will be unconditionally and irrevocably guaranteed by Bluestar.

The outlook is stable.

Proceeds will be used for debt refinance, capital expenditure, working capital and general corporate purposes.

"The perpetual securities will improve Bluestar's liquidity and debt maturity profile, without any significant impact on its credit metrics," Moody's vice president and senior analyst Gerwin Ho said in a news release.

The amount of the proposed perpetual securities – if successfully issued -– will be small relative to Bluestar's existing debt of about RMB 50 billion as of June 2015. As such, the perpetual securities do not affect Moody's earlier expectation that the company will improve its debt/EBITDA to around 6 times over the next two to three years.

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