BAKU, Azerbaijan, September 15. The Fitch Ratings international rating agency assigned the final long-term rating 'BB-' to the senior unsecured bonds of the Georgian Silk Road Group Holding LLC investment company for the sum of $400 million with repayment in 2030.
The data obtained by Trend from Fitch Ratings shows that the bond rating is set at the level of 'BB-' with a positive forecast, which corresponds to the default rating of the issuer, and the recovery rating of the instrument is set at the level of 'RR4'.
"Bonds are issued in the form of senior unsecured obligations, and the proceeds will be directed to the refinancing of existing debt, including the debts of subsidiary companies, as well as to strengthening the company's liquidity. Fitch notes that the main factors influencing the rating of Silk Road have remained unchanged," the agency said.
According to the data, the ratings reflect the ownership of the Silknet, the second largest telecommunications operator in Georgia, with stable market positions, by the Silk Road company, as well as profitable business in the segment of luxury hotels and casinos.
These directions generate a stable internal cash flow, which, according to the agency's forecasts, will be sufficient to finance new construction on the company's land plots.
The data from calculations indicates that Fitch also takes into account that the net debt burden on EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) will remain at a level below 2.5x.
However, the agency warns of possible risks associated with the implementation of new projects, currency volatility, and the economic environment of Georgia, which may affect the future level of the debt burden.
