ACRA assigns AA+(RU) to bonds issued by JSC “HC “METALLOINVEST”

Credit rating rationale. The issues represent senior unsecured debt of JSC “HC “METALLOINVEST” (hereinafter, the Company). Due to the absence of either structural or contractual subordination of the issues, ACRA regards them as pari passu with other existing and future unsecured and unsubordinated debt obligations of the Company. According to ACRA’s methodology, the credit rating of the issues is equivalent to that of the Company, i.e. AA+(RU).

As per the methodology, the Agency applied a simplified approach, which takes into account the Company’s credit rating (higher than ВВВ-(RU)), as well as the presence of low debt load, high debt servicing indicators or high liquidity, and pre-export financing (PXF), which share in the Company’s debt portfolio is less than 40%.

The credit rating of the Company is based on its strong market position. The rating is also based on a very strong business profile assessment determined by a high-quality resource base. As such, the Company’s production cost is one of the lowest in the mining segment not only in Russia, but also in the world. A high assessment of geographical sales diversification, strong corporate governance, and a very strong financial profile support the Company’s rating.

The Company is a leading mining and metallurgical holding company in Russia and one of the world’s largest, supplying domestic and foreign markets with iron ore concentrate, pellets, hot-briquetted iron (HBI), as well as cast iron and steel products, including high-quality steel (Special Bar Quality). The Company holds one of the world’s largest reserves of high-quality and accessible iron ore, resulting in lower production costs. The main production assets of the Company are Lebedinsky GOK, Andrey Varichev Mikhailovsky GOK, OEMK, and Ural Steel. A. B. Usmanov is one of the largest beneficiaries of the Company.

Key issue properties

Issuer

JSC “HC “METALLOINVEST”

Issuer’s credit rating

АА+(RU), outlook Stable

Type of security

Exchange-traded* interest-bearing non-convertible certified bearer bonds
subject to centralized title registration

Series/ISIN

 

02/RU000A0JTLJ3

03/RU000A0JTLL9

BО-02/RU000A0JWBF6

BО-03/RU000A100YF3

BО-04/RU000A101EF3

BО-07/RU000A0JW5H6

BО-08/RU000A0JWBE9

BО-09/RU000A100B73

BО-10/RU000A101R90

Volume of placement

 

RUB 5 bln

RUB 5 bln

RUB 10 bln

RUB 10 bln

RUB 10 bln

RUB 5 bln

RUB 5 bln

RUB 5 bln

RUB 5 bln

Series/ISIN

 

02/RU000A0JTLJ3

03/RU000A0JTLL9

BО-02/RU000A0JWBF6

BО-03/RU000A100YF3

BО-04/RU000A101EF3

BО-07/RU000A0JW5H6

BО-08/RU000A0JWBE9

BО-09/RU000A100B73

BО-10/RU000A101R90

Placement date/Maturity date

 

February 8, 2013/January 27, 2023

February 8, 2013/January 27, 2023

March 29, 2016/March 17, 2026

October 23, 2019/October 10, 2029

February 12, 2020/January 30, 2030

February 25, 2016/February 12, 2026

March 29, 2016/March 17, 2026

April 29, 2019/April 16, 2029

June 4, 2020/May 23, 2030

* Excluding series 02 and 03 bond issues.

Regulatory disclosure

The credit rating has been assigned under the national scale for the Russian Federation based on the Methodology for Assigning Credit Ratings to Individual Issues of Financial Instruments under the National Scale of the Russian Federation, and the Key concepts used by the Analytical Credit Rating Agency within the scope of its rating activities.

The credit rating has been assigned to the bond issues (series 02, 03, BО-02, BО-03, BО-04, BО-07, BО-08, BО-09, BО-10) of JSC “HC “METALLOINVEST” for the first time. The credit rating is expected to be revised within one year following the publication date of this press release.

The assigned credit rating is based on data provided by JSC “HC “METALLOINVEST,” information from publicly available sources, and ACRA’s own databases. The credit rating is solicited, and JSC “HC “METALLOINVEST” participated in its assignment.

No material discrepancies between the provided data and data officially disclosed by JSC “HC “METALLOINVEST” in its financial statements have been discovered.

ACRA provided no additional services to JSC “HC “METALLOINVEST.” No conflicts of interest were discovered in the course of credit rating assignment.

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