OREANDA-NEWS  On 11 November Credit-Rating, a nationally recognized credit rating agency in Ukraine announced that it downgraded to uaB from uaBB+ the long-term credit rating assigned to registered coupon bonds issued by Lviv-based Mist Express LLC (`issuer` or `company`). The amount of the issue is UAH25m, with 3-year original maturity. The rating outlook has been changed to stable. The company`s principal activity is carriage of cargo and of small packages within Ukraine. To revise the rating Credit-Rating considered issuer`s financial statements for 1H2008 and its other inside information.

An obligor or a debt liability with uaB credit rating is characterized with the LOW creditworthiness as compared to other Ukrainian obligors or debt liabilities. This level of creditworthiness is extremely susceptible to adverse changes in commercial, financial and economic conditions.

Stable outlook indicates that there are no anticipated reasons to change the rating in the course of the year.

Factors maintaining the credit rating

The issue is guaranteed by SP Rosan LLC, which is one of the issuer`s founders and is associated with a legally informal group of companies.

Growth in auto carriage segment: the cargo turnover of the companies in Ukraine amounted to 379.7 billion of tons/km over 9M2008, which is 4.6% higher than in the similar period of 2007; the earnings from rendering postal services amounted to UAH1.5bn, which is 12.6% higher than in the similar period of 2007.

Issuer`s wide-spread branch network comprising of 34 offices, specifically the issuer has representative offices in all Ukraine`s oblast centres.

Factors constraining the credit rating

Issuer`s detrimental performance coupled with its negative equity of UAH(19m) as of June 30, 2008.

Issuer`s ambitious expansion plans; the amount of investments of about UAH80m planned for 2008-2010 will increase issuer`s debt burden.

The risks associated with redistribution of funds within the group`s companies neglecting issuer`s interests.

Hot competition in the national cargo transportation segment.