S&P rates KOKS notes B-

Standard & Poor's said that it assigned a B- debt rating to the proposed $350 million of loan participation notes due 2016 to be issued by orphan Irish special-purpose vehicle KOKS Finance Ltd. The recovery rating on the notes is 5, indicating modest (10%-30%) recovery.

The notes are for the sole purpose of financing a loan to OAO Koks (B/stable), the agency said. The debt rating is one notch below the long-term corporate credit rating on Koks.

The B corporate credit rating on Koks is unaffected.

The recovery rating on the notes is supported by Koks' significant asset valuation, the agency said. The recovery rating is constrained by the unsecured nature of the notes, the existence of significant secured debt ranking ahead of the notes, the loan's relatively weak security package and Russia's relatively creditor-unfriendly insolvency regime.

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