Fitch assigns Tourism Development and Investment Company's GMTN programme final 'AA' rating

Fitch has also assigned yesterday's issue, under the GMTN programme, of $1.0bn 6.50% notes due 2 July 2014, a 'AA' rating.

The programme's final rating follows a review of its final terms and conditions which conform to information already received by Fitch. TDIC Finance has been established as a special purpose vehicle for the sole purpose of issuing notes under the GMTN programme and is 100% owned by Tourism Development and Investment Company PJSC (TDIC).

The rating of the GMTN programme is in line with that of TDIC, which has a, Long-term Issuer Default Rating (IDR) and senior unsecured rating of 'AA', respectively. The Outlook on the IDR is Stable.

The notes will be unconditionally and irrevocably guaranteed by TDIC. The obligations under the guarantee will be direct, unconditional, unsubordinated and unsecured obligations of TDIC and will rank equally with all other unsecured obligations of TDIC.

Notes issued under the GMTN programme will also constitute direct, unconditional, unsubordinated and unsecured obligations of TDIC Finance and will rank equally among themselves and with all other unsecured obligations of TDIC Finance.

The terms and conditions of the GMTN programme include a negative pledge including carve-outs for project finance, security interest pursuant to Sharia financing and also securitisations. There is a cap on the negative pledge carve-outs limiting secured debt to 15% of the book value of the consolidated total assets of TDIC and its subsidiaries. The programme also incorporates a note holder put option in case government ownership of TDIC falls below 100%. An event of default will be triggered if TDIC's ownership of TDIC Finance falls below 100%, and as is typical for such programmes, there are no financial covenants and no restrictions on asset disposals or additional indebtedness.

TDIC's objective, as set forth by the government of Abu Dhabi, is the high profile implementation of the government's initiative to develop a diversified economy through tourism and land development. Fitch has applied its parent and subsidiary rating linkage methodology to conclude that a strong relationship exists between TDIC and the Emirate of Abu Dhabi ('AA'/Stable). As such, TDIC's IDR has been and remains aligned with Fitch's sovereign rating of Abu Dhabi.