Moody's Investors Service has placed Ba3 corporate family ratings and Aa3.ru national scale corporate family rating of SUAL International Ltd under review for possible upgrade following the group's joint announcement with Russian aluminium producer Rusal (not rated) and Glencore International AG (Baa3/stable) of a three-way merger of the respective aluminium assets.
The merger is expected to be concluded by 1 April 2007 and the newly formed United Company RUSAL (not rated) is expected to become the world-leader in aluminium production (by tonnage) with estimated 12.5% of global aluminium market share and 16% of global alumina production.
Moody's views the announced transaction as a transformational event for SUAL International Ltd and will focus its review on the i) final capital structure of the combined group and the place of the rated entity in the new structure; 2) fundamental credit characteristics of the combined business, including the level of upstream integration, diversity of operations, cost efficiency and profitability and its intrinsic financial strength; 3) shareholders' plans and business strategy of the
combined group; 4) financial profile of the combined company and SUAL after the
merger, as well as 5) medium operating and financial outlook.