Fitch gives A to Tianjin Rail bond

Fitch Ratings said it affirmed Tianjin Rail Transit Group Co., Ltd.'s long-term foreign- and local-currency issuer default ratings at A.

The outlook is stable.

The agency also assigned Rail Transit International Development Co. Ltd.’s proposed senior unsecured bullet note denominated in euros an A(EXP) rating.

The bond will be unconditionally and irrevocably guaranteed by Tianjin Rail Transit Group (Hong Kong) Co., Ltd. (TRTHK), a wholly owned subsidiary of Tianjin Rail.

Proceeds will be used for general corporate purposes.

In place of a guarantee, Tianjin Rail granted a keepwell and liquidity support deed and a deed of equity interest purchase undertaking to ensure that Tianjin Rail HK has sufficient assets and liquidity to meet its obligations under the guarantee for the proposed euro-denominated bond, which will be Tianjin Rail’s second issuance of offshore debt.

Fitch said the bond is rated at the same level as Tianjin Rail’s issuer default rating due to the strong linkage between Tianjin Rail HK and Tianjin Rail, and because the keepwell and liquidity support deed and deed of equity interest purchase undertaking transfer the ultimate responsibility of payment to Tianjin Rail.

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