Noranda,Battle Mtn Gold Rtgs Afmd
Norcen S&PWatch Dev
NEW YORK--(BUSINESS WIRE)--Standard & Poor's CreditWire 11/18/97-- Standard & Poor's today affirmed its credit ratings (see list below) on Noranda Inc., 40% controlling shareholder EdperBrascan Corp., and affiliates Noranda Forest Inc. (66% owned by Noranda) and Falconbridge Ltd. (49%). The ratings outlook is stable.
Standard & Poor's also affirmed its credit ratings on Battle Mountain Gold Co. (NYSE:BMG - news; 28% owned by Noranda). The outlook remains negative.
In addition, Standard & Poor's placed its credit ratings on Norcen Energy Resources Ltd. (49% owned by Noranda) on CreditWatch with ''developing'' implications. Developing implications means that ratings could be either raised or lowered.
The ratings actions follow the announcement that over the next 12 months, Noranda will sell its interest in Norcen and distribute its investments in Noranda Forest and Canadian Hunter Exploration Ltd. (unrated) as a dividend to shareholders. Noranda will retain its interests in Falconbridge and Battle Mountain. Proceeds from the divestitures, estimated at around C$1.6 billion, will be reinvested in core mining and metals opportunities.
While this could result in a strengthening of Noranda's business profile, the distribution of the company's investments in Noranda Forest and Canadian Hunter through dividends may erode its equity base. Also, ratings on Noranda remain linked to those of EdperBrascan. EdperBrascan has a 40% interest in Noranda and plays an influential role in the management strategies and dividend policies of the company.
Following the sale of Norcen, ratings on the company could be either raised or lowered depending on the credit profile of the buyer. The announced restructuring is not expected to have any material impact on the credit profile of Falconbridge, Battle Mountain, or Noranda Forest. Standard & Poor's did not impute any support from Noranda in Noranda Forest's credit ratings. The restructuring will lead EdperBrascan to own a direct 26% interest in Noranda Forest.
Standard & Poor's will closely monitor the announced restructuring. -- CreditWire
RATINGS AFFIRMED
Noranda Inc.
Corporate credit rating BBB
Senior unsecured debt BBB
Senior unsecured debt shelf (preliminary) BBB
Rated debt: US$1 billion
EdperBrascan Corp.
Corporate credit rating BBB
Commercial paper A-2
Senior unsecured debt BBB
Senior unsecured debt shelf (preliminary) BBB
Rated debt: US$200 million
Noranda Forest Inc.
Corporate credit rating BBB
Senior unsecured debt BBB
Rated debt: US$450 million
Falconbridge Ltd.
Corporate credit rating: BBB+
Senior unsecured debt BBB+
Senior unsecured debt shelf (preliminary) BBB+
Rated debt: US$450 million
Battle Mountain Gold Co.
Corporate credit rating BB
Preferred Stock rating B+
Bank loan rating BB
Shelf debt (preliminary) BB/B+
Rated debt: US$250 million
RATINGS PLACED ON CREDITWATCH WITH DEVELOPING IMPLICATIONS
Norcen Energy Resources Ltd.
Corporate credit rating BBB
Senior unsecured rating BBB
Senior unsecured debt shelf (preliminary) BBB
Rated debt: US$650 million |
