Fitch rates NKNK notes B

Fitch Ratings said it assigned an expected B senior unsecured rating to NKNK Finance plc's proposed issue of $101.39 million 12% loan participation notes due in 2012. The expected rating is in line with the B long-term issuer default rating of parent company OAO Nizhnekamskneftekhim.

The ratings are on Rating Watch negative.

The new notes will form part of the exchange offer by NKNK for up to $200 million of its 8½% loan participation notes due in 2015. The agency said that on Wednesday, NKNK announced that around 84% of noteholders had agreed to take up the offer and the company has also received noteholder approval to remove the December 2010 put option attached to the existing notes.

Fitch previously said that the exchange offer, if successful, would be an important step in removing potential liquidity pressure on NKNK in the fourth quarter of 2010. However, the agency also said it will need to gain assurance that refinancing options are in place in the first quarter of 2010 to meet other potential obligations.

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