Moody's: Raspadskaya view to stable

Moody's Investors Service said it affirmed Raspadskaya OAO's corporate family rating and probability of default rating at B2 and B2-PD, respectively, and changed the outlook from negative to stable.

Concurrently, the agency affirmed the rating on the senior unsecured debt issued by Raspadskaya Securities Ltd., a limited liability company incorporated in Ireland, and its probability of default rating at B2 and B2-PD (with a loss-given default assessment of LGD4, 50%), respectively.

"The affirmation of the rating at B2 and stabilization of outlook follows Evraz plc (unrated) consolidation of 82% stake in the share capital of Raspadskaya OAO earlier in 2013 and a degree of potential support by Evraz evidenced by continuing integration of Raspadskaya OAO's operations (including treasury, reporting and budgeting functions) under Evraz plc and inter-group funding in the form of a $100 million loan provided to Raspadskaya OAO by Evraz plc/Evraz Group SA (Ba3 stable), with which the company refinanced bilateral bank facility," Denis Perevezentsev, a Moody's Vice President and lead analyst for Raspadskaya, said in a news release.

"Production issues at the company's Raspadskaya mine following the temporary suspension of operations in May 2013, low coking coal prices, weak credit metrics and lack of formal guarantees from Evraz plc or Evraz Group SA limit the level of alignment between CFRs of Raspadskaya OAO and Evraz Group SA."

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