Fitch rates Gazprom LPNs BBB-

Fitch Ratings said it assigned Gaz Capital SA's loan participation notes (LPNs) an expected senior unsecured BBB-(EXP) rating.

The planned notes are the 44nd series to be issued under Gaz Capital's $40 billion debt issuance program rated BBB- by Fitch.

The LPNs will be issued on a limited recourse basis for the sole purpose of funding a loan by Gaz Capital to PJSC Gazprom (BBB-/positive), the agency said. The terms of the loan agreement between Gaz Capital and Gazprom mirror those of the notes, so the notes repayment will be made with proceeds from respective loan repayments by Gazprom.

Proceeds are expected to be used by Gazprom for general corporate purposes. The noteholders will rely solely on Gazprom's credit and financial standing for the payment of obligations under the notes.

The LPNs are rated at the same level as Gazprom's issuer default rating on the basis that the loan will represent an unsecured and unsubordinated obligation of the company, Fitch explained.

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