Fitch cuts KazakhGold to CCC

Fitch Ratings said it downgraded KazakhGold Group Ltd.'s long-term issuer default rating to CCC from B and downgraded KazakhGold's senior unsecured rating to CCC with recovery rating of 4 from B with recovery rating of 4. Both ratings remain on rating watch negative.

The downgrade follows a fall in production substantially short of the company's forecasts and will be materially lower than 2007 levels, the agency said. The production slump was principally caused by inadequate access to capital during the year, Fitch said.

Further negative rating actions remain a possibility should KazakhGold not secure alternative sources of funding to improve its current financial position, Fitch said, adding that its corporate transparency remains an issue.

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