Moody’s cuts Dalian Wanda, Wanda Commercial

Moody's Investors Service said it downgraded the ratings of Dalian Wanda Commercial Properties Co., Ltd. and Wanda Commercial Properties (HK) Co. Ltd. (Wanda HK).

Specifically, the agency downgraded Dalian Wanda’s issuer rating of Baa3 to Ba1 and withdrawn, and assigned a Ba1 corporate family rating.

Moody’s also downgraded Wanda HK's corporate family rating to Ba3 from Ba1.

In addition, the senior unsecured ratings for the bonds issued by Wanda Properties Overseas Ltd. and Wanda Properties International Co. Ltd. were downgraded to Ba3 from Ba1. Both companies are wholly owned subsidiaries of Wanda HK.

The rated bonds are guaranteed by Wanda HK and supported by deeds of equity interest purchase undertaking and keepwell deeds between Dalian Wanda, Wanda HK and the bond trustee.

The issuers of the rated bonds were maintained – in interest reserve accounts – the equivalent of two periods of interest payments on the bonds.

The outlooks on all ratings are negative.

"The downgrade of DWCP's rating to Ba1 reflects our concerns over the company's weakened liquidity position – due to inadequate offshore cash to meet the potential repayment of its offshore bank loans of around $1.7 billion – arising from potential non-compliance of certain maintenance requirements related to the company's existing borrowing obligations," Moody's vice president and senior credit officer Kaven Tsang said in a news release.

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