Fitch downgrades China Fishery

Fitch Ratings said it downgraded China Fishery Group Ltd.’s issuer default rating to RD (restricted default) from C.

The agency said it did not assign an outlook.

The company has not paid the scheduled coupon due Jan. 30 on its $300 million senior notes even after the end of the 30-day grace period Feb. 29, Fitch said.

The non-payment is consistent with an RD rating, which signifies the uncured expiry of any applicable grace period, cure period or default forbearance period following a payment default on a material financial obligation, the agency said.

China Fishery’s senior unsecured rating and the rating on the $300 million senior unsecured notes issued by financing vehicle CFG Investment SAC were affirmed at C with a recovery rating of RR4.

The company’s access to financing was hampered in November 2015 after HSBC filed a winding-up petition against China Fishery, which was subsequently dismissed by the courts, the agency explained.

But the petition severely curtailed the company’s access to funding and thus the company is facing a cash crunch, Fitch said.

China Fishery is now in discussions with banks and other creditors to obtain financing, which would allow the company to resume normal operations, the agency said.

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