Moody's gives PowerChina securities Baa2

Moody's Investors Service said it gave a Baa2 rating to the planned subordinated perpetual securities to be issued by DianJian Haiyu Ltd. and guaranteed by Power Construction Corp.of China.

“The Baa2 rating on the proposed subordinated perpetual securities reflects (1) the unconditional and irrevocable guarantee from PowerChina, (2) a one-notch downward adjustment from PowerChina's baseline credit assessment (BCA) of ba1 because of the subordinated nature of the securities and (3) three notches of uplift based on the high likelihood of extraordinary support from the government of China (A1 stable) in times of need. The securities are subordinated to PowerChina's senior unsecured debt but rank above its junior subordinated debt and common stock,” Moody’s said in a press release.

PowerChina will use the proceeds to refinance its debt.

The outlook remains stable.

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