S&P rates LenSpecSMU notes B

Standard & Poor's said it assigned a B global scale issue rating and ruA Russia national scale rating to the proposed RUB 2 billion senior unsecured notes to be issued CJSC SSMO LenSpecSMU. A recovery rating of 4 was assigned, indicating an expectation of 30% to 50% recovery in the event of a default. The corporate credit ratings are unchanged. The issue rating on the $100 million credit-linked notes issued by Golden Ring Finance SA and guaranteed by LenSpecSMU, is unchanged at B with a recovery rating of 4. The issue rating on its existing RUB 2 billion unsecured notes due 2012 is unchanged at B with a recovery rating of 4.

Downward pressure on the unsecured debt ratings is possible should the share of secured debt in the capital structure increase, S&P said.

Material depreciation of the ruble versus the dollar could depress estimated recoveries to less than 30% to 50%, the agency said.

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