Finance

Finance

Fitch assigns final rating of SOCAR’s notes

09 February 2012 15:27 (UTC +04:00)

Baku â€“ APA-Economics. Fitch Ratings has assigned State Oil Company of the Azerbaijan Republic’s (SOCAR) proposed notes an expected foreign currency senior unsecured rating of ’BBB-(exp)’, in line with SOCAR’s Long-term Issuer Default Rating (IDR) of (’BBB-’/Stable), Reuters reported.

SOCAR’s ratings incorporate state support as SOCAR is wholly state-owned, represents the state’s interests in the strategically important oil and gas industry, and continues to receive equity injections from the state (AZN190m in 2011), in accordance with Fitch’s parent and subsidiary rating linkage methodology.

In Fitch’s view, although SOCAR continues to benefit from relatively strong links with the Azerbaijan state (’BBB-’/Positive), full and timely financial support, which would allow full rating alignment with the sovereign, is not certain without robust legal ties (e.g. explicit guarantees). Government guaranteed debt accounted for only 4% of the group’s total debt at end-H111. Therefore, the Outlook on SOCAR’s Long-term IDR remained Stable after the Outlooks on Azerbaijan’s Long-term IDRs were revised to Positive on 17 May 2011.