AK&M Agency affirms the credit rating of SOCAR Polymer

Baku. 27 July. REPORT.AZ/ AK & M rating agency has affirmed the credit rating of SOCAR Polymer (a subsidiary of the State Oil Company of Azerbaijan Republic -SOCAR) on a national scale rating at A+ with stable outlook.

Report informs referring to the agency, the rating A+ means that SOCAR Polymer belongs to a class of borrowers with a very high degree of creditworthiness. The risk of delays in the implementation of commitments is not significant.

SOCAR Polymer is a typical project finance company (SPV), created by the implementation of technically specific project. SOCAR Polymer tasked with creating the production capacities at the industrial zone of Sumgayit city for production of high-pressure polyethylene and polypropylene, as well as the subsequent operation of these facilities. Capital costs of the project set at $770 million. Amount of credit resources for realization of the project is $489 million. The main raw material for the production will serve an ethylene, propylene and hydrogen supplied by SOCAR.

Currently, implementation of SOCAR Polymer project is on the stage of investments development – as construction of production capacities is underway. The project envisages that the construction will be completed in 2018, the first production of SOCAR Polymer will be gained in the first half of 2018.

The factors maintaining the credit rating of SOCAR Polymer are high profitability of the project; balance of the basic financial flows SOCAR Polymer and high financial sustainability of the project; temporarily preferential tax treatment provided for SOCAR Polymer, as well as participation of SOCAR in the project, also in the authorized capital of SOCAR Polymer.