Fitch assigns Kunming Rail notes BBB+

Fitch Ratings said it assigned a BBB+ rating to Kunming Rail Transit Group Co., Ltd.’s proposed dollar-denominated dollar senior unsecured bonds. The agency also BBB+ to the company’s long-term foreign- and local-currency issuer default ratings.

The bonds are rated at the same level as the company’s long-term foreign-currency IDR because they will be sold directly by KRTG and they will constitute the company’s direct, unconditional, unsubordinated and unsecured obligations and will rank equally with all its unsecured and unsubordinated obligations.

Proceeds will be used for repaying onshore debt and supplementing operating capital.

The company is wholly owned by the Kunming municipality via its State-owned Assets Supervision and Administration Commission, which has direct control and oversight of the company’s major corporate events, Fitch said.

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