PRAGUE, Aug 1 (Reuters) - Standard & Poor’s rating agency cut its rating on Czech hard coal miner New World Resources to selective default, or ‘SD’, from ‘CC’ on Friday after the firm missed a coupon payment on its unsecured notes last month.
NWR said last month it did not make the payment amid ongoing restructuring its capital and debt, a plan including a haircut for bondholders and major dilution for shareholders that must still be approved by the involved parties. NWR has a 30-day grace period to make the payment.
S&P said it cut issue rating on the 275 million euro senior unsecured notes due in 2018 to ‘D’ (default) from ‘CC’ and the issue rating on the firm’s 500 million euro senior secured notes to ‘SD’ from ‘CC’.
NWR said it would hold bondholder meetings to vote on the restructuring plan on Aug 29. A shareholders meeting on new equity issue has been called for Aug. 20.
The firm has reached agreements on the debt restructuring with part of the bondholders and believes the plan will be approved.
“The date of the meetings, combined with the lock-up agreements (with noteholders) in place, indicates to us that the likelihood of NWR paying the overdue interest payments has reduced significantly. According to our criteria, we view this as a default,” S&P said. (Reporting by Jan Lopatka)