Fitch Ratings has revised China Fishery Group Limited's (China Fishery) Outlook to Negative from Stable. Its Long-Term Issuer Default Rating (IDR), its senior unsecured rating, and its USD 300 million (EUR 234 million) senior unsecured notes are affirmed at ‘BB-’. The Outlook has been revised to Negative following China Fishery’s higher-than-expected offer of USD 778 million (EUR 606 million for the entire equity interest in Copeinca from the previously stated valuation of USD 600 million (EUR 467 million).
Fitch expects this higher acquisition price and a weaker-than-expected performance in the Peruvian fishmeal industry this year to increase China Fishery’s 2013 leverage, as measured by adjusted net debt/EBITDAR, to above 3.0x, before falling marginally below this level in 2014. Nevertheless, the risk remains for China Fishery's leverage to be above 3.0x, in the event of operational or capital budgeting surprises.
