Moody's rates Sabic bonds A1

Moody's Investors Service said it assigned a provisional A1 senior unsecured rating to the proposed issue of senior unsecured bonds by Sabic Capital I BV, an indirect wholly owned subsidiary of Saudi Basic Industries Corp. The bonds will be unconditionally and irrevocably guaranteed by Sabic.

The outlook is stable.

The proceeds will be used for the refinancing of existing group debt in line with its corporate strategy to gradually centralize the funding of the group at the parent level and further reduce the complexity of the group's debt structure, Moody's said.

The rating reflects the group's strong global positions in the petrochemicals and fertilizer markets, as well as its highly competitive cost position underpinned by substantial scale benefits and access to significantly cost-advantaged feedstock, the agency said.

The rating also takes into account the weakening in Sabic's financial profile and credit metrics relative to historical levels, Moody's said.

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