OREANDA-NEWS. On 6 February 2008  Credit-Rating, a nationally recognized credit rating agency in Ukraine assigned a long-term credit rating of uaBB to UAH200m 5-year registered coupon bonds (D-G series) to be issued by Kiev-based METALLURGICAL CENTRE LLC. The company`s primary activity is wholesale trade with raw materials for metal production, as well as office leasing and construction. In the course of analysis Credit-Rating considered Issuer`s financial statements for 2002-2006 and 9M2007 as well as other inside information furnished by the company.

An obligor or a debt liability with uaBB credit rating is characterized with the LOWER THAN SUFFICIENT creditworthiness as compared to other Ukrainian obligors or debt liabilities. This level of creditworthiness is strongly affected by adverse changes in commercial, financial and economic conditions.

Factors constraining the credit rating
The Issuer owns real estate property and sites for construction, where 6 buildings are to be built by 2012; as at 2007-end overall Issuer`s investments in construction made up UAH206m (17.5 per cent from the planned amount).
The Issuer is associated with the legally informal international MIDLAND GROUP, which, to name a few, is engaged with construction in Russia and Ukraine; in the event of need the Issuer may get necessary backing from the Group.

Factors constraining the credit rating
High Issuer`s debt burden: the consolidated commitments on financial obligations, including the bond issue will account for UAH552m, which almost 10x exceeds Issuer`s equity of UAH57m as of Sep. 30, 2007 with the debt expected to rise to UAH1.2bn, which is associated with the increased investments in the planned projects.
The Issuer is exposed to risks related to redistribution of funds within the group of companies neglecting Issuer`s interests.
The successful implementation of investment and construction projects is contingent upon environment in the real estate market.