Fitch puts Guangzhou R&F on watch

Fitch Ratings said it placed Guangzhou R&F Properties Co. Ltd.'s BB long-term foreign- and local-currency issuer default ratings, senior unsecured rating and ratings of all of its outstanding notes issued by subsidiaries on Rating Watch negative.

This follows the company's plan to acquire Dalian Wanda Commercial Property Co. Ltd.'s hotel assets for ¥20 billion.

Fitch said it believes the acquisition will push up Guangzhou R&F's total debt level and keep its leverage as measured by net debt-to-adjusted inventory near the agency's 60% threshold.

Guangzhou R&F's strong contracted sales in the first half of the year could have helped it de-leverage, but undertaking this acquisition will slow the de-leveraging process, Fitch explained.

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