Fitch: Temir Zholy notes BBB-

Fitch Ratings said it assigned an expected senior rating of BBB-(exp) to the proposed notes to be issued by Kazakhstan Temir Zholy Finance BV and guaranteed by Kazakhstan Temir Zholy. The company has BBB- long-term issuer default and senior ratings, and the outlook on the issuer default rating is positive.

The agency said Kazakhstan Temir Zholy's ratings reflect its 100% indirect state ownership and strategic importance to Kazakhstan (BBB/positive/F3).

Although Kazakhstan Temir Zholy benefits from strong links with the state, full and timely financial support, which would allow rating alignment with the sovereign, is not certain without robust legal ties, Fitch said. The company's rating is therefore one notch down from the sovereign.

Fitch revised Kazakhstan Temir Zholy's outlook to positive from stable after the upgrade of Kazakhstan's issuer default rating to BBB/positive from BBB-/positive in November 2011.

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