Business
UPDATED: 09:46, April 15, 2006
Moody's acquires 49 pct stake in Chinese rating agency http://english.peopledaily.com.cn/200604/15/eng20060415_258515.html
Leading international credit rating agency Moody's Corporation has entered agreement to buy a 49 percent stake in China Cheng Xin International Credit Rating Co. Ltd., (CCXI).
CCXI said on its website Friday that it will be turned into a joint venture between Moody's and its parent company, the China Cheng Xin Credit Management Co. Ltd. (CCXCM). The latter will hold a 51 percent stake in CCXI.
Terms and conditions of the transaction were not disclosed, but CCXI said Moody's has an option to increase its ownership over time as permitted by Chinese authorities.
Established in 1992, CCXI is one of the first domestic credit rating agencies in China. It is headquartered in Beijing and specializes in providing rating opinions on corporate bonds, convertible bonds, financial institutions, structured finance and short term financing paper. Moody's will provide management expertise, technical support on rating methodologies and training of analysts.
CCXI will continue to provide domestic ratings reflecting relative credit risk within China, while Moody's will continue to provide globally ratings. Moody's and CCXI also plan to market joint ratings to global issuers in the local Chinese markets.
"Moody's partnership with CCXI establishes an important platform for Moody's to provide credit ratings, research and analysis in China. Moody's will benefit from CCXI's local market knowledge and CCXI will benefit from Moody's technical know-how in credit ratings and analysis," said Raymond W. McDaniel, Jr., President and Chief Executive Officer of Moody's Corporation. "CCXI has a leading position in the Chinese market, and we believe that Moody's affiliation will help us to better serve domestic capital market participants in China,"said Mao Zhenhua, chairman of CCXCM. The transaction will be subject to regulatory approvals by the Chinese government.
Source: Xinhua
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