PRESS RELEASE: Fitch Assigns Tesco Property Finance 3 Expected 'A-' Rating

29th Jun 2010 13:42

Link to Fitch Ratings' Report: Tesco Property Finance 3 plc 16-JUN-2010http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=534569Fitch Ratings-London-29 June 2010: Fitch Ratings has assigned Tesco Property Finance 3 Plc's forthcoming fixed-rate GBP950.2m* class A notes, due April 2040, an expected 'A-' rating with Stable Outlook. The expected rating addresses the timely payment of interest and timely repayment of principal. Fitch gave consideration to the integrity of the legal and financial structures in assigning the expected rating to the forthcoming issue. The final rating is contingent upon the receipt of final documents conforming to information already received. The transaction is a securitisation of rental income derived from 41 retail stores located in the UK. The properties are fully let to Tesco Stores Limited and Tesco Property Nominees No.5 and No.6 (the tenants) until October 2040. The notes are scheduled to fully amortise by the final maturity date in April 2040. The tenants are wholly-owned subsidiaries of Tesco PLC ('A-'/Stable/ 'F2'), which is the guarantor of all rental payments. Consequently, the expected rating is fully credit-linked to the rating of Tesco PLC and any change in the corporate rating is likely to result in a corresponding change in the rating of the notes. The transaction has an expected initial loan-to-value ratio of 102.8% and an expected initial loan-to-vacant possession value ratio of 133.8%, although scheduled amortisation will ensure that these ratios decline to zero by loan maturity. Applicable criteria, 'Criteria for European CMBS Asset Analysis (Europe CMBS)', dated 12 September 2007, 'Criteria for European CMBS Surveillance (Europe CMBS)', dated 12 November 2008 and 'Global Structured Finance Rating Criteria', dated 30 September, 2009, are available at www.fitchratings.com. A copy of the presale report for the transaction is available at www.fitchratings.com. * This is the expected note issuance amount. The final amount will be confirmed on the issue date. Contacts: Alessandro Pighi, London, Tel: +44 (0) 20 7417 6308/; Oliver Kimche, +44 (0) 20 7417 6331. Media Relations: Julian Dennison, London, Tel: +44 020 7682 7480, Email: [email protected]. Additional information is available on www.fitchratings.com. Related Research: Criteria for European CMBS Asset Analysis (Europe CMBS)http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=340982Criteria for European CMBS Surveillance (Europe CMBS)http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=413442Global Structured Finance Rating Criteriahttp://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=469406 ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: HTTP://FITCHRATINGS.COM/UNDERSTANDINGCREDITRATINGS. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY'S PUBLIC WEBSITE 'WWW.FITCHRATINGS.COM'. PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH'S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE 'CODE OF CONDUCT' SECTION OF THIS SITE. (END) Dow Jones Newswires June 29, 2010 08:42 ET (12:42 GMT)