Moody's: Kia Motors notes Baa1

Moody's Investors Service said it assigned a Baa1 rating to the proposed senior unsecured dollar-denominated notes to be issued by Kia Motors Corp.

The outlook is stable.

Proceeds will be used for working capital, repayment of existing debt and other general corporate purposes.

Moody’s said the rating reflects the company's underlying credit strength, which is equivalent to a Baa2 rating level, underpinned by the company's considerable synergies with its parent Hyundai Motor Co., solid position in the Korean automotive market, high level of geographic diversity and strong balance sheet.

The rating also recognizes the automotive industry's cyclical and highly competitive nature, Kia's weakening profitability and moderate scale and product line-up.

The ratings also consider a one-notch uplift from its underlying credit strength based on an expectation that the company will receive support from Hyundai Motor Co. in a distressed scenario, the agency said.

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