Fitch gives BBB+ to ChemChina notes

Fitch Ratings said it assigned CNRC Capital Ltd.’s proposed euro-denominated senior notes an expected rating of BBB+(EXP) on Rating Watch Positive.

The notes will be unconditionally and irrevocably guaranteed by China National Chemical Corp. (ChemChina, BBB+/positive watch). The issuer is a fully owned subsidiary of ChemChina.

Proceeds will be used to pay down debt related to ChemChina's acquisition of Pirelli & C. SpA.

Fitch said the rating reflects ChemChina's strong linkages with the China sovereign (A+/stable) due to its key positions in the agriculture and aerospace sectors, which are strategically important to the government.

The positive reflects the Feb. 3, 2016 announcement that ChemChina offered to buy Syngenta AG for $43 billion.

The proposed notes are rated at the same level as ChemChina's senior unsecured rating as they are unconditional, unsecured and unsubordinated obligations of the company, Fitch said.

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