[ET Net News Agency, 9 October 2013] Standard & Poor's Ratings Services said today that
it had lowered its long-term corporate credit rating on Winsway Coking Coal Holdings Ltd.
(01733) to 'SD' (selective default) from 'CC'.
At the same time, the credit rating agency lowered the issue rating on the company's
US$500 million 8.5% senior unsecured notes due 2016 to 'D' from 'CC'.
S&P also lowered its long-term Greater China regional scale rating on Winsway to 'SD'
and on the notes to 'D' from 'cnCC'.
"We downgraded Winsway after the company's announcement that it will complete the
buyback offer of US$153.6 million of its US$500 million 8.5% senior unsecured notes due
2016," said S&P's credit analyst Huma Shi.
The company has received consent from noteholders representing about 68.60% of the total
outstanding notes. S&P views such a buyback offer as a continuation of Winsway's tender
offer, and therefore a "distressed exchange," tantamount to an immediate default.
Winsway will buy back 31.27% of outstanding notes from noteholders, paying US$475 for
every note of US$1,000 par value. For 2.08% of the outstanding notes, Winsway will pay
noteholders US$375 for every US$1,000.
"After completion of the buyback, we will reassess Winsway's credit profile,
particularly the company's liquidity position," said Shi. "We believe that under Winsway's
distressed financial situation, the company's access to bank credit may be uncertain."
(KL)