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05.03.2007
Upcoming bond issue by «K & FD» LLC assigned uaB credit rating
"Credit-Rating", a nationally-recognized credit rating agency in Ukraine has today announced the assignment of the uaB long-term credit rating to the upcoming issue of registered discount bonds (A series) by Dnepropetrovsk-based "K & FD" LLC ("the Issuer" or "the company") for the amount of UAH 25m with the 9-year original maturity. The main company`s activity is construction. Today the company constructs 4 residential and commercial buildings in Dnepropetrovsk. In the course of analysis "Credit-Rating" used Issuer`s financial statements for 2005 and 9M2006 as well as other inside information furnished by the company.
The uaB issue rating reflects higher default possibility than of the uaBB rating, though in this case the obligor`s capacity is adequate to pay its obligations in the Ukrainian financial market environment. This debt liability is more affected by the adverse changes in business, financial and economic conditions than debt liabilities with higher ratings. That may negatively affect the obligor`s capacity and willingness to fully and timely pay interest and principal on obligations.
Factors maintaining the credit rating
- The Issuer implements 4 investment and construction projects in the city of Dnepropetrovsk with the current construction readiness being 90%, 98%, 25%, 10% as of 15 Jan. 2007.
- The Issuer is involved in residential construction in Dnepropetrovsk, where real estate prices and demand have been growing over the past few years.
Factors constraining the credit rating
- The planned issue size is UAH 25m, with the Issuer`s equity being UAH 35.5K
- The Issuer does not have experience in bond issuances, neither in their redemption.
- Volatility in legislation and taxation on operations connected with construction and with attraction of funding.
Information on all the credit ratings assigned in accordance with the Ukrainian national scale may be found in the REUTERS and BLOOMBERG information systems.
For further information, please contact:
Information and analytic department
Sergey Rozumyak +38 044 490 25 50
SRozumyak@credit-rating.com.ua
