Moody’s Investors Service has assigned a B3 rating to Mongolian Mortgage Corporation HFC LLC’s (MIK) proposed USD-denominated senior unsecured debt. The final amounts and terms of the debt will depend on market conditions and on the result of a cash tender offer.

The proposed senior unsecured debt is guaranteed by MIK’s parent company, MIK Holding JSC.

The proceeds will be used to finance MIK’s cash tender offer to repurchase its outstanding senior unsecured debt maturing in January 2022, to repay any remaining outstanding debt and for general corporate purposes.

The rating on the securities is subject to the receipt of final documentation, the terms and conditions of which are not expected to change in any material way from the draft documents that Moody’s has reviewed. Should issuance conditions and/or final documentation deviate from the original ones submitted and reviewed by the rating agency, Moody’s will assess the impact that these differences may have on the ratings and act accordingly.

The entity-level outlook on MIK remains negative. The B3 rating is in line with MIK’s long-term foreign currency issuer rating, as the senior unsecured bonds will constitute a direct, general, unsubordinated, unconditional and unsecured obligation of the issuer. The bonds will be redeemable at principal on maturity.

On 14 January, in addition to issuance of the new senior unsecured debt, MIK also announced a tender offer on its USD 300 million 9.75% senior unsecured notesmaturing in January 2022 at 102% of the debt’s principal, in addition to accrued interest.