Fitch rates Zhejiang Provincial Energy notes A

Fitch Ratings said it assigned a final rating of A to Zhejiang Provincial Energy Group Co. Ltd.’s $300 million 2.3% senior unsecured notes due 2017.

The notes are issued by Zhejiang Energy Group (Hong Kong) Co. Ltd., which is effectively 92% owned by Zhejiang Provincial Energy, Fitch said.

The Hong Kong subsidiary is Zhejiang Provincial Energy’s primary and most important overseas coal procurement platform, Fitch said.

Zhejiang Provincial Energy appoints all of Zhejiang Hong Kong’s senior management and closely manages and monitors Zhejiang Hong Kong’s business, the agency said.

Zhejiang Provincial Energy benefits from favorable allocation of quality energy resources, accounting for at least half of the newly developed power generation projects and owning equity interest in all nuclear power projects in Zhejiang province, Fitch said.

The provincial government authorities support Zhejiang Provincial Energy’s investments in coal resources outside the province by facilitating its negotiations with other provincial governments, the agency said.

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