S&P cuts Hopson notes to BB

Standard & Poor's said it lowered its corporate credit rating on Hopson Development Holdings Ltd. to BB from BB+. The rating was removed from CreditWatch, where it had been placed with negative implications in January following Hopson's issuance of a Chinese renminbi 1.83 billion convertible bond due 2010.

The outlook is stable.

S&P also said it lowered its issue ratings on Hopson's $350 million 8.125% notes due 2012 and on the convertible bond to BB from BB+. The ratings also were removed from CreditWatch.

The rating was lowered to reflect the company's weakened financial profile and credit protection measures, the agency said.

The rating also reflects above-average risk that property developers face in China, the company's concentrated activities in Guangzhou and a lack of stable recurring income, S&P said.

These weaknesses are partly mitigated by Hopson's satisfactory business profile, underpinned by a diverse revenue stream from a large number of saleable real-estate projects, the agency added.

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