Financial News, January 20, Standard & Poor's to FORTUNE STAR (BVI) LIMITED intends to issue a dollar-denominated advanced unsecured note "BB" long-term issue rating, the note is headquartered in China Fosun Limited (Fosun International Limited, referred to as "Fosun", 00656.HK) to provide unconditional and irrevocable guarantee. Bill issuer FORTUNE STAR (BVI) LIMITED is a special purpose entity. Ratings depend on S & P's review of the final release document.

Due to the credit substitution under the guarantee, the rating of the note is the same as the issuer's credit rating (BB/ negative / -) on Fosun. As an investment holding company, Fosun's mortgage debt accounts for less than 50 per cent of total debt at the parent level. As a result, it did not meet the S & P 50% structural dependency risk reduction threshold.

Fosun plans to use the proceeds from the proposed notes for refinancing, working capital and other general corporate purposes.

The "negative" outlook reflects S & P's expectation that Fosun will maintain a shorter debt maturity over the next 12 months as the company seeks to extend its maturity by acquiring longer-term debt capital. S & P could downgrade if Fosun fails to extend its weighted average maturity from the current 1.5 years, or if the company's cash source falls below 1.2 times its cash use. S & P may also downgrade Fosun's loan-to-value ratio of more than 45 per cent as a result of an increase in the company's risk appetite (as can be seen from the speed at which acquisitions outpace disposal) or a sharp decline in the value of listed assets.