OREANDA-NEWS. Fitch Ratings has assigned Hanrui Overseas Investment Co., Ltd's USD300m 4.90% senior unsecured notes due 2019 a final rating of 'BB+'.

The assignment of the final ratings follows the receipt of documents conforming to information already received. The final ratings are in line with the expected ratings assigned on 21 June 2016.

The offshore notes are unconditionally and irrevocably guaranteed by Hanrui International Investment Company Limited (HII), which is a direct, wholly owned subsidiary of Jiangsu HanRui Investment Holding Co., Ltd (Hanrui; BB+/Stable). The notes are senior unsecured obligations of HII and rank pari passu with its other senior unsecured obligations. Net proceeds will be used for general corporate purposes.

KEY RATING DRIVERS

Hanrui has granted a keepwell and liquidity support deed and a deed of equity interest purchase in place of a guarantee, undertaking to ensure HII has sufficient assets and liquidity to meet its obligations under HII's guarantee for the US dollar notes.

The notes are rated at the same level as Hanrui's Issuer Default Ratings due to the strong linkage between HII and Hanrui and because the keepwell and liquidity support deed and deed of equity interest purchase transfers the ultimate responsibility of payment to Hanrui. Fitch believes this signals a strong intention from Hanrui to ensure HII has sufficient funds to honour its debt obligations.

Hanrui's ratings are credit-linked with, but are not equalised to, Fitch's assessment of Zhenjiang Municipality's credit profile. The link reflects strong oversight and supervision of Hanrui by the Zhenjiang municipal government, integration of multi-year funding for the company with the municipal budget and the strategic importance of Hanrui's public-sector construction projects and social housing construction to the municipality. Hanrui is classified as a credit-linked public-sector entity under Fitch's criteria.

RATING SENSITIVITIES

Any rating action on Hanrui will result in a similar rating action on the rated bond issued by Hanrui Overseas Investment Co., Ltd.

Stronger or more explicit support from Zhenjiang Municipality may trigger positive rating action on Hanrui. Significant changes to Hanrui's strategic importance to the municipality, dilution of the municipality's shareholding or lower explicit and implicit municipality support could lead to a wider rating gap between Hanrui and Zhenjiang.

An upgrade of Fitch's internal credit view on Zhenjiang Municipality may trigger positive rating action on Hanrui. Weaker fiscal performance or higher municipality debt could lead to a lowering of Fitch's internal assessment of Zhenjiang Municipality's creditworthiness and may trigger negative rating action on Hanrui.