Credit rating rationale. The issues represent senior unsecured debt of JSC "MCC "EuroChem" (hereinafter, the Company). Due to the absence of either structural or contractual subordination of the issues, ACRA regards them as pari passu with other existing and future unsecured and unsubordinated debt obligations of the Company. According to ACRA’s methodology, the credit rating of the issues is equivalent to that of the Company, i.e. AA-(RU).
The credit rating of JSC "MCC "EuroChem" is based on the Company’s strong business profile, very strong geographic diversification, very high corporate governance, very large size, high profitability and coverage indicators, as well as strong liquidity. The rating is constrained by the average assessments of the market position, leverage and cash flow.
JSC "MCC "EuroChem" is the main production unit of EuroChem Group (hereinafter, the Group, EuroChem Group, or EuroChem). Given the fact that the Company accounts for around 70% of the assets and cash flow (and around 40% of the leverage) of EuroChem Group, ACRA used the Group’s consolidated indicators to assess the Company’s creditworthiness. EuroChem Group is one of the four largest global fertilizer producers (in terms of 2019 revenues). The Group produces nitrogen, phosphate, potash and complex fertilizers, and operates in the iron ore concentrate and organic synthesis product supply segment. The Company’s ultimate beneficiary is Andrey Melnichenko, who owns a 100% stake in the Cypriot company AIM Capital SE, which controls 90% of the stocks of EuroChem Group AG.
Key issue properties
| Borrower | JSC "MCC "EuroChem" |
| Offeror | EuroChem Group |
| Issuer’s credit rating | АА-(RU), outlook Stable |
| Actual issuer | JSC "MCC "EuroChem" |
| Type of security | Exchange-traded interest-bearing non-convertible certified bearer bonds |
| Issue volume | RUB 19 bln |
| ISIN / Reg. No. | RU000A1008Z0 / 4B02-03-31153-H-001P |
| Offer date | April 09, 2019 |
| Maturity date | April 09, 2022 |
| Borrower | JSC "MCC "EuroChem" |
| Offeror | EuroChem Group |
| Issuer’s credit rating | АА-(RU), outlook Stable |
| Actual issuer | JSC "MCC "EuroChem" |
| Type of security | Exchange-traded interest-bearing non-convertible certified bearer bonds |
| Issue volume | RUB 10 bln |
| ISIN / Reg. No. | RU000A100LS3 / 4B02-04-31153-H-001P |
| Offer date | July 18, 2019 |
| Maturity date | January 18, 2023 |
| Borrower | JSC "MCC "EuroChem" |
| Offeror | EuroChem Group |
| Issuer’s credit rating | АА-(RU), outlook Stable |
| Actual issuer | JSC "MCC "EuroChem" |
| Type of security | Exchange-traded interest-bearing non-convertible certified bearer bonds |
| Issue volume | RUB 10 bln |
| ISIN / Reg. No. | RU000A100LV7 / 4B02-05-31153-H-001P |
| Offer date | July 19, 2019 |
| Maturity date | July 19, 2023 |
| Borrower | JSC "MCC "EuroChem" |
| Offeror | EuroChem Group |
| Issuer’s credit rating | АА-(RU), outlook Stable |
| Actual issuer | JSC "MCC "EuroChem" |
| Type of security | Exchange-traded interest-bearing non-convertible certified bearer bonds |
| Issue volume | RUB 13 bln |
| ISIN / Reg. No. | RU000A100RG5 / 4B02-06-31153-H-001P |
| Offer date | August 23, 2019 |
| Maturity date | August 18, 2023 |
| Borrower | JSC "MCC "EuroChem" |
| Offeror | EuroChem Group |
| Issuer’s credit rating | АА-(RU), outlook Stable |
| Actual issuer | JSC "MCC "EuroChem" |
| Type of security | Exchange-traded interest-bearing non-convertible uncertified bonds |
| Issue volume | RUB 10 bln |
| ISIN / Reg. No. | RU000A101L96 / 4B02-07-31153-H-001P |
| Offer date | April 16, 2020 |
| Maturity date | April 10, 2025 |
| Borrower | JSC "MCC "EuroChem" |
| Offeror | EuroChem Group |
| Issuer’s credit rating | АА-(RU), outlook Stable |
| Actual issuer | JSC "MCC "EuroChem" |
| Type of security | Exchange-traded interest-bearing non-convertible uncertified bonds |
| Issue volume | RUB 25 bln |
| ISIN / Reg. No. | RU000A101LJ0 / 4B02-08-31153-H-001P |
| Offer date | April 21, 2020 |
| Maturity date | April 15, 2025 |
Regulatory disclosure
The credit rating has been assigned under the national scale for the Russian Federation based on the Methodology for Assigning Credit Ratings to Individual Issues of Financial Instruments under the National Scale of the Russian Federation, and the Key concepts used by the Analytical Credit Rating Agency within the scope of its rating activities.
The credit rating has been assigned to the bond issues (series BO-001P-03 (RU000A1008Z0), BO-001P-04 (RU000A100LS3), BO-001P-05 (RU000A100LV7), BO-001P-06 (RU000A100RG5), BO-001P-07 (RU000A101L96), BO-001P-08 (RU000A101LJ0)) of JSC "MCC "EuroChem" for the first time. The credit rating is expected to be revised within one year following the publication date of this press release.
The assigned credit rating is based on data provided by EuroChem Group and JSC "MCC "EuroChem," information from publicly available sources, and ACRA’s own databases. The credit rating is solicited, and EuroChem Group and JSC "MCC "EuroChem" participated in its assignment.
No material discrepancies between the provided data and data officially disclosed by JSC "MCC "EuroChem" and EuroChem Group in their financial statements have been discovered.
ACRA provided no additional services to JSC "MCC "EuroChem." No conflicts of interest were discovered in the course of credit rating assignment.
