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S&P revises HMS Group credit rating

Moscow, Russia, HMS Group (LSE: HMSG), the leading pump and compressor manufacturer, supplier of turnkey process engineering packages  and provider of flow control solutions and related services in Russia and the CIS, announces that Standard & Poor’s Rating Services downgraded the long-term corporate rating  of the company from “B-“ to “CCC” and kept it on CreditWatch with negative implications.

According to S&P, this action reflects near-term refinancing risks arising from the Rub 2.1bn unsecured bond maturity in February 2015.  The agency believes that there is a risk of a default due to challenging financial market conditions in Russia unless HMS is able to attract financing or source additional liquidity.  Also, in S&P’s opinion refinancing risks are coupled with the company’s weak operating environment.

Currently HMS Group is at negotiation stages with a number of banks, has some liquidity cushion and continues to collect funds for bond repayment as well.
HMS Group
is the leading pump and compressor manufacturer, as well as provider of flow control solutions and related services to the oil and gas, nuclear and thermal power generation and water utilities sectors in Russia and the CIS. HMS Group’s products are mission-critical elements of projects across a diverse range of industries. It has participated in a number of large-scale infrastructure projects in Russia, including providing pumps and modular equipment to the Vankor oil field and pumping stations on recent trunk pipelines projects linking Russia’s core oil producing areas to export ports on the Pacific Ocean and Baltic Sea. HMS Group’s global depositary receipts (“GDRs”) are listed under the symbol “HMSG” on the London Stock Exchange.

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