Fitch assigns Steel Funding notes BBB

Fitch Ratings said it assigned Steel Funding DAC's planned €500 million of loan participation notes a BBB senior unsecured rating.

The notes will be issued on a limited recourse basis for the sole purpose of funding a loan to Novolipetsk Steel, rated BBB.

“The noteholders will rely solely on NLMK's credit and financial standing for the payment of obligations under the notes. The proposed LPNs are rated at the same level as NLMK's issuer default rating (IDR) on the basis that the loan will represent an unsecured and unsubordinated obligation of the company and rank pari passu with all other unsubordinated and unsecured indebtedness of NLMK,” Fitch said in a press release.

The proceeds are expected to be used by NLMK to fund a cash tender offer for notes and for general corporate purposes.

The outlook is stable.

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