Standard & Poor“s Ratings Services said 15 November 2007 that its rating and outlook for China Glass Holdings Ltd. (China Glass; B+/Positive/–) has not been affected by the company“s announcement t…
Standard & Poor“s Ratings Services said 15 November 2007 that its rating and outlook for China Glass Holdings Ltd. (China Glass; B+/Positive/–) has not been affected by the company“s announcement that its subsidiary, Weihai Blue Star Glass Co. Ltd., will have to relocate. The local authority in Weihai, eastern Shandong province, plans to exercise its land use rights for the site. The relocation is not expected to weaken China Glass“ credit metrics as the local authority has agreed to pay compensation of CNY 360 million and because the facility makes only a modest contribution to the group“s total production. In addition, Standard & Poor“s expects the company to minimize the impact that the move will have on production. The positive outlook reflects continuing improvement in the company“s credit risk profile, supported by: significantly increased production capacity following recent acquisitions; an improved operating performance through the 1H 2007; and an increase in liquidity from a bond issue in July 2007 used to refinance short-term bank funding.