Aluminum Corp of China's 'BBB+' long-term corporate rating affirmed - S&P

MUMBAI (Thomson Financial) - Standard and Poor's Ratings Services said it has affirmed the 'BBB+' long-term corporate credit rating of Aluminum Corp. of China Ltd. (Chalco) with a stable outlook and removed the rating from negative watch where it was placed on Feb 5.

The rating on Chalco was put on negative watch after Aluminum Corp. of China (Chinalco), Chalco's largest and controlling shareholder with approximately 40 percent stake, said Chinalco has cquired 12 percent of Rio Tinto Plc.

S&P said the credit watch removal reflects its expectation that debt raised at Chinalco's level to fund the Rio Tinto acquisition is unlikely to have an immediate financial impact on Chalco. The terms of the financing are from five to 12 years, thus incremental annual debt servicing obligations for the next four years will be only interest payments, the ratings agency said.

S&P noted that Chinalco's prominent position in China's strategically important sector, along with its good credit standing is likely to allow the company continued access to bank funding when needed, even under the current credit tightening environment.

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