Moody's assigns Kunpeng bond Baa3

Moody's Investors Service said it assigned a Baa3 senior unsecured rating to the bond to be issued by Zhejiang Kunpeng (BVI) Co. Ltd. (Kunpeng), a wholly-owned subsidiary of Hangzhou Shangcheng State-owned Capital Operation Group Co., Ltd.

A keepwell and liquidity support deed between Kunpeng, Shangcheng Capital and the bond trustee, as well as a deed of equity interest purchase undertaking between Shangcheng Capital and the bond trustee will support the bond. The bond will also be supported by a cross-border standby facility agreement between Shangcheng Capital and the issuer.

"The Baa3 senior unsecured rating on the bond reflects Shangcheng Capital's credit quality, the features of the bond, as well as its ability and willingness to support the bond issuer," said Stephen Tang, a Moody's assistant vice president and analyst, in a press release.

The proceeds will be used for refinancing offshore debt and replenishing working capital.

The outlook is stable.

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