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18.05.2007
Upcoming bond issue by Prompolitiks assigned uaCCC+ credit rating
Credit-Rating, a nationally-recognized credit rating agency in Ukraine has today announced the assignment of the uaCCC+ (uaCCC plus) long-term credit rating to the upcoming issue of registered housing bonds (A-C series) by Dnepropetrovsk-based Prompolitiks LLC (`Issuer` or `company`) for the amount of UAH 132.3 m due Dec. 31, 2018. The main company`s activity is investment and construction. Today the company constructs a residential and office complex in the city of Dnepropetrovsk. In the course of analysis Credit-rating used Issuer`s financial statements for 2005-2006 as well as other inside information furnished by the company.
The uaCCC issue rating reflects a default possibility, which may be faced in the Ukrainian financial market environment. The timely and full payments on debt liabilities are substantially dependant upon favourable business, financial and economic conditions. The `+` and `-` modifiers denote rating`s relative status within major categories.
Factors maintaining the credit rating
- The Issuer constructs a residential building in 11, Furmanova str. (Dnepropetrovsk) with the volume of investments having amounted to UAH5.7m (5% from the total volume) as of Dec. 31, 2006.
- The Issuer is involved in organizing and financing the construction of residential and commercial premises in the city of Dnepropetrovsk, where real estate prices and demand have been growing over the past few years.
Factors constraining the credit rating
- The Issuer does not have experience in investment and construction projects, neither in bonds` redemption.
- The project to be financed by the funds raised from the bond issue is as of Apr. 6, 2007 on the stage of arrangement.
- Issuer`s financial obligations 9% exceeded its asset balance as of Dec. 31, 2006; the equity amounted to UAH-1.02m resulted from company`s detrimental performance in 2005-2006.
- 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, BLOOMBERG and FTN MONITOR information systems.
For further information, please contact:
Information and analytic department
Sergey Rozumyak +38 044 490 25 50
SRozumyak@credit-rating.com.ua
