Fitch Ratings downgrades China Fishery's issuer default rating

Fitch Ratings has downgraded China Fishery Group's issuer default rating to "D" or "default" from "RD" or "restricted default". No outlook has been assigned.

The downgrade follows China Fishery's announcement on June 30 that the company and its subsidiaries had filed for US bankruptcy protection under Chapter 15 and Chapter 11 of the US bankruptcy code.

A "D" rating indicates an issuer that in Fitch Ratings' opinion has entered into bankruptcy filings, administration, receivership, liquidation or other formal winding-up procedure, or which has otherwise ceased business.

An "RD" rating indicates an issuer has experienced an uncured payment default on a bond, loan or other material financial obligation but has not entered into bankruptcy filings, administration, receivership, liquidation or other formal winding-up procedure, and which has not otherwise ceased operating.

In its statement on China Fishery, the ratings agency noted that the bankruptcy filing will facilitate a debt restructuring arrangement with holders of the US$300 million senior unsecured notes issued by China Fishery's financing vehicle CFG Investment SAC. China Fishery failed to pay a coupon on the notes that was due on Jan 30 this year, Fitch noted.

China Fishery's senior unsecured rating and the rating on the US$300 million notes issued by CFG Investment SAC have been affirmed at "C", which indicates exceptionally high levels of credit risk, with a Recovery Rating of "RR4", defined as average recovery prospects given the default, Fitch said in its statement.

The ratings agency added that it will re-examine China Fishery's credit profile if it successfully restructures its debt.