Moody's rates Eldorado Gold notes Caa1

Moody's Investors Service said it assigned a Caa1 (LGD 5) rating to Eldorado Gold Corp.'s proposed senior secured second-lien notes due 2024.

There is no change to Eldorado's existing ratings, including its B3 corporate family rating, B3-PD probability of default rating, B3 senior unsecured rating and SGL-3 speculative grade liquidity rating.

The outlook remains stable.

The proceeds from the proposed $300 million of senior secured second-lien notes will be used in combination with proceeds from the proposed $200 million first-lien secured term loan due in 2023 to repay Eldorado's $600 million senior unsecured notes due December 2020.

The ratings are constrained by the company's high costs in 2018, resulting in weak profitability and high leverage, Moody's said.

The ratings also reflect the relatively high geopolitical risks related to the company's assets in Greece and its small scale, the agency said.

The stable outlook reflects an expectation that Eldorado has sufficient liquidity to continue executing on its new heap leach strategy at Kisladag and potentially improve both leverage and lower operating costs, Moody's said.

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