Printer Friendly

Fitch Ratings assigns OCI N.V. IDR of 'BB'(EXP).

London: Fitch Ratings, a nationally recognized statistical rating organization (NRSRO) designated by the U.S. Securities and Exchange Commission, assigned OCI N.V. an expected Long-Term Issuer Default Rating (IDR) of 'BB'(EXP) with a Stable Outlook.

It assigned the Dutch chemicals group's proposed USD1 billion bond an expected senior secured rating of 'BB-(EXP)' with a Recovery Rating 'RR5'. OCI's 'BB(EXP)' rating incorporates an overall business profile commensurate with a 'BBB' category rating and our expectation that the currently weak 'B' category financial profile will improve in 2018.

Its lease-adjusted funds from operations (FFO) net leverage was 9.1x at end-2017, reflecting a large debt-funded expansion programme and production issues in North Africa. Our rating case forecasts a reduction in net leverage to around 5x at end-2018 on the back of new capacity ramp-ups and a return to historical utilisation rates in North Africa where production issues would have been sustainably resolved.

The Stable Outlook reflects Fitch's view that the execution risk on the capacity ramp-up is low and that volume growth, neutral-to slightly positive pricing trends and normalised capex levels will aid OCI's ability to de-leverage to FFO adjusted net leverage of 4.5x by 2020 and maintain an overall credit profile commensurate with a 'BB' rated entity. The senior secured bond expected rating of 'BB-(EXP)' reflects Fitch's assessment of the structure and security of the bond in relation to existing debt within the OCI consolidated group. The notes are structurally subordinated to around USD2.7 billion of secured debt owed by operating subsidiaries of OCI.

COPYRIGHT 2018 Plus Media Solutions
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 2018 Gale, Cengage Learning. All rights reserved.

Article Details
Printer friendly Cite/link Email Feedback
Publication:Daily the Pak Banker (Lahore, Pakistan)
Date:Jun 29, 2018
Words:260
Previous Article:Fitch assigns Ronesans Gayrimenkul Yatirim A.S. IDR of 'BB+(EXP)'.
Next Article:Fitch Ratings assigns Turkiye Finans Katilim Bankasi A.S.'s certificates 'BBB-(EXP)'.

Terms of use | Privacy policy | Copyright © 2021 Farlex, Inc. | Feedback | For webmasters |