S&P rates CQNA notes BBB

S&P said it assigned a BBB long-term rating to a proposed issue of dollar-denominated senior unsecured notes by Chongqing Nan'an Urban Construction & Development (Group) Co. Ltd. (CQNA).

The proceeds will be used for repayment of its existing offshore and onshore debt, S&P said.

The agency said it equalizes the rating with the issuer credit rating on CQNA because there is no material subordination risk in the capital structure.

This also reflects the fact that the proposed debt is not contractually subordinated, S&P noted.

CQNA will construct and finance more than half of the infrastructure projects in Nan'an district in the coming one to two years, the agency explained.

The company also owns more than half of the state-owned assets under the Nan'an district government, S&P said.

There is an almost certain likelihood that the company will continue to receive extraordinary support from the government over the next 24 months, the agency said.

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