Moody's withdraws Sistema-Hals' ratings

London, 09 July 2009 -- Moody's Investors Service has today withdrawn the B3 corporate family and probability of default ratings and Baa3.ru NSR of Sistema-Hals. The company does not have any outstanding debt rated by Moody's. Moody's has withdrawn Sistema-Hals' ratings for business reasons. Please refer to Moody's Withdrawal Policy, "Moody's Guidelines for the Withdrawal of Ratings", available on www.moodys.com. The last rating action on Sistema-Hals was on 22 December 2008, when Moody's downgraded the corporate family rating and NSR of Sistema-Hals to B3 from B1 and to Baa3.ru from A1.ru. This action was prompted by continuing concerns arising from the substantial weakening of the company's operating performance and liquidity profile developing on the background of the rapidly deteriorating conditions in the Russian real estate sector. The ratings remained on review for possible downgrade subject to a resolution of the review for downgrade of Sistema-Hals' parent Sistema Joint Stock Financial Corporation ("Sistema", B1, negative). The review on Sistema was concluded on 21 April 2009, resulting in the Ba3 corporate family and probability of default ratings of Sistema JSFC ("Sistema" or the "Company") being downgraded to B1, and the senior unsecured rating to B2. The outlook on Sistema's ratings is negative. The principal methodologies used in rating Sistema-Hals are the methodologies for homebuilders and global construction which can be found at www.moodys.com in the Credit Policy & Methodologies directory, in the Rating Methodology subdirectory. Other methodologies and factors that may have been considered in the process can also be found in the Credit Policy & Methodologies directory. Sistema-Hals, headquartered in Moscow, Russia, is a property developer with operations primarily in Moscow and the Moscow region, and presence in six regions in Russia as well as Yalta and Kiev in Ukraine. In the beginning of 2009 Sistema, a 71.1% owner of the company at that time, reached an agreement with Vneshtorgbank (VTB, Baa1, stable) on the sale of a controlling stake in the entity; which is in process subject to regulatory approval. During fiscal year 2008, Sistema-Hals reported revenue of US$362 million and EBITDAR of US$38.4 million.

• Full name
  PJSC Hals-Development
• Registration country
  Russia
• Industry
  Construction and development