Moody's: Gemdale bonds Ba3

Moody's Investors Service said it assigned a Ba3 senior unsecured rating to the proposed bonds to be issued by Gemdale (Asia) Holding Ltd.

Moody's also said it affirmed Gemdale Corp.'s Ba1 corporate family rating and Famous Commercial Ltd.'s Ba3 corporate family rating. Famous is a wholly-owned subsidiary of Gemdale.

The agency also said it affirmed the Ba3 senior unsecured ratings for the bonds issued by Gemdale International Holding Ltd. and Gemdale International Investment Ltd.

The outlook is stable.

The proposed bonds will be guaranteed by Famous and supported deeds between Famous, Gemdale and the bond trustee, Moody's said.

The proceeds will be used for debt refinancing, Moody's said.

The proposed bond issuance is in line with Famous' plan to refinance is existing bank loans with debt of longer maturity, which will improve Famous' funding stability by lengthening its debt maturity profile, said Kaven Tsang, a Moody's analyst.

On the other hand, the replacement of Famous' existing bank loans, which are ultimately guaranteed by Gemdale, will slightly increase Famous' repayment risk, Tsang said.

Nevertheless, Moody's said it expects that the amount of new bond issuance will be maintained at a manageable level.

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