S&P: Hutchison Port notes BBB+

Standard & Poor’s said it assigned a BBB+ rating to a proposed issue of dollar-denominated senior unsecured notes by HPHT Finance (15) Ltd.

The agency also said it assigned a cnA+ long-term Greater China regional scale rating to the proposed notes.

HPHT Finance (15) Ltd. is wholly owned subsidiary of Hutchison Port Holdings Trust. Hutchison Port and another subsidiary, HPHT Ltd., will unconditionally and irrevocably guarantee the notes on an unsubordinated and unsecured basis.

The trust is expected to use a substantial portion of the net proceeds to refinance some of the debt at its subsidiaries, meet its short-term debt obligations and make an early repayment of debt that would provide the company with an economic benefit, S&P said.

The rest of the proceeds will be used for general corporate purposes.

The rating is the same as the corporate credit rating on Hutchison Port because the company is expected to maintain its ratio of priority liabilities-to-total assets at less than 20% over the next 12 months, the agency said.

The ratings reflect the company’s solid market position in the Pearl River Delta region and stable cash flows from its natural deep-water port operations, S&P said.

The trust’s geographic concentration, competition from other ports in China and declining profit margin temper these strengths, the agency said.

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