UDC gets downgraded on sale news

S&P Global Ratings has lowered its credit rating on UDC Finance from A- to BBB, and this rating remain on CreditWatch with
negative implications, meaning it is more likely to be downgraded in the future than lifted.

The downgrade reflects S&P's opinion that the likelihood of timely support from UDC's ultimate owner, ANZ, has reduced following the announcement of its sale to the privately owned Chinese conglomerate HNA Group, which is not rated.

The sale is scheduled to be completed toward the end of the 2017 calendar year and requires various regulatory approval.

S&P continues to apply a one-notch uplift to its rating on UDC, instead of three as it has done in the past, for likely support from the ANZ group. "This is because, notwithstanding the likely sale of UDC in the short term, we believe that in periods of distress for UDC in the interim (should any arise, which we do not expect), there remains the potential for some limited support from the ANZ group."