Fitch rates Qingdao City Construction bonds BBB

Fitch Ratings said it assigned Qingdao City Construction Investment (Group) Ltd.'s proposed dollar-denominated senior unsecured bonds a rating of BBB.

The bonds will be sold by Hong Kong International (Qingdao) Co. Ltd. and will benefit from a keepwell deed, a deed of equity interest purchase undertaking and an irrevocable cross-border, U.S.-dollar standby facility agreement issued by QCCI.

The proceeds will be used for refinancing.

“The proposed bonds are rated at the same level as QCCI's long-term foreign-currency issuer default rating (IDR). In Fitch's opinion, the keepwell deed, the deed of equity interest purchase undertaking and the cross-border, U.S.-dollar standby facility signal QCCI's strong intention to ensure that HKIQD has sufficient funds to honor its debt obligations. The agency also believes that QCCI intends to maintain its reputation and credit profile in the international offshore market, and is unlikely to default on offshore obligations. In addition, a default by HKIQD could significantly limit QCCI's offshore funding,” said Fitch in a press release.

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