Moody's rates Sitronics, notes B3

Moody's Investors Service said it assigned a provisional B3 corporate family rating to the JSC Concern Sitronics.

Concurrently, Moody's said it assigned a provisional B3 rating to the proposed notes of up to $200 million to be issued by Sitronics Finance SA.

The outlook is stable.

Moody's added the B3 corporate family rating reflects the following credit weaknesses: significant event risk due to the company's intentions to continue to grow through acquisitions, high business risk associated with the company's operating activities in the technology sector and the competitive nature of the markets in which the company operates.

More positively, the rating reflects the credit strengths that include the company's 94.5% ownership by JSFC Sistema (B1/stable) and the latter's recent equity contribution to Sitronics' share capital, Sitronics' strong track record of revenue and EBITDA growth and cross-selling opportunities to other Sistema subsidiaries such as Mobile TeleSystems OJSC (Ba3/stable) and Moscow City Telephone Network PJSC (Ba3/stable).

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