Moody's rates China South City B1, notes B2

Moody's Investors Service said it assigned a definitive B1 corporate family rating to China South City Holdings Ltd. and a definitive B2 senior rating to its $250 million of 13.5% five-year notes.

The outlook is stable.

The proceeds will fund the company's construction and expansion of its trade centers as well as ancillary residential units and support facilities in Shenzhen, Nanning, Nanchang, Heyuan and Xi'an.

The rating reflects the view that the $250 million proceeds raised from the bond issuance will provide a liquidity cushion for the company to develop its projects and will improve the company's debt maturity profile, Moody's said.

The ratings reflects the company's unique business model of successfully developing and operating integrated trade centers in Shenzhen as well as its ability to access large-scale suburban land plots at attractive prices, the agency said.

The ratings also consider that the expansion into large-scale developments in new locations presents an execution risk, the agency added.

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