RPT-Fitch Rates ADIF AV's EUR3bn EMTN Programme 'BBB (EXP)'

Mon Apr 14, 2014 7:52am EDT

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April 14 (Reuters) - (The following statement was released by the rating agency)

Fitch Ratings has assigned ADIF Alta Velocidad's (ADIF AV; BBB/F2/Stable), Spanish high speed rail infrastructure administrator, proposed EUR3bn EMTN programme expected ratings of 'BBB(EXP)'. The EMTN programme will be used for general corporate purposes and issues under the programme will constitute direct, unconditional, unsubordinated and unsecured obligations of the ADIF AV.

The assignment of the final ratings on the programme is contingent upon the receipt of final documents conforming to information already received. ADIF AV was created at end-December 2013 through Royal Decree 15/2013, after it was segregated from ADIF (BBB/F2/Stable) (see 'Fitch:ADIF Split Neutral on Credit Profile' dated 19 December 2013). The existing ADIF is responsible for the conventional rail network in Spain and receives state subsidies, while ADIF AV is responsible for the maintenance and expansion of the high speed rail network.

KEY RATING DRIVERS

ADIF AV's ratings are equalised with those of Spain's Issuer Default Rating (BBB/Stable/F2). This reflects the entity's public sector legal status and strong operational and strategic ties with the government, resulting in a high likelihood of extraordinary government support if needed. ADIF AV is therefore classified as a dependent public sector entity under Fitch's criteria.

RATING SENSITIVITIES

The ratings of the programme are credit linked to ADIF AV's ratings. Therefore any rating action on the issuer would be mirrored on the ratings of the programme or issues under the programme.

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