Global rating agency Moody’s downgraded Fosun International by one notch on Tuesday and revised its outlook to ‘negative’ from ‘ratings under review’, after the firm divested more assets to ease liquidity and debt burdens, reports Reuters.
The downgrade to B2 from B1 followed Fosun’s announcement last week that its units would sell a combined 60% stake in Nanjing Nangang Iron & Steel United for up to RMB 16 billion ($2.19 billion). The Chinese conglomerate and its units had earlier cut stakes in firms such as New China Life Insurance and Shanghai Yuyuan Tourist Mart Group.
The “significant” decline in the market value of Fosun’s listed assets has eroded its funding headroom, Moody’s said in a statement, adding it estimated a roughly 30% drop in the market value of Fosun’s key holdings between the end of June and October 20, due to shareholding dilution and share price falls.
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