P R E S S A N N O U N C E M E N T
FOR
IMMEDIATE RELEASE
NO IMMEDIATE IMPACT ON
MALAKOFF POWER BERHAD’S DEBT RATINGS FROM DEFERMENT OF MALAKOFF CORPORATION
BERHAD’S IPO PLAN
MARC said today that the delay in the planned initial
public offering (IPO) by Malakoff Corporation Berhad (Malakoff), the parent
company of Malakoff Power Berhad (MPower), will have no immediate impact on the
AA-IS/Stable and MARC-1IS/Stable
ratings on MPower’s RM5.4 billion Sukuk Murabahah and RM300
million Islamic commercial papers (ICP) programme.
The ratings, which were assigned on December 4, 2013,
had anticipated Malakoff’s planned IPO on Bursa Malaysia by 1H2014 with
proceeds raised from the exercise to mainly fund the early redemption of
Malakoff’s RM1.8 billion unrated Junior Sukuk due in 2042. Accordingly, the
deferment of the planned IPO would result in a delay in the Junior Sukuk’s
early redemption date. While the additional financing costs are expected to be
met with available cash allocated for dividend payments from Malakoff to its
wider base of shareholders post IPO, MARC is mindful of the potential impact
from any prolonged delay of the IPO plan on Malakoff’s ability to refinance its
RM1.3 billion equity bridging loan (EBL) provided to wholly-owned subsidiary
Tanjung Bin Energy Issuer Sdn Bhd which matures in 2017. The rating agency
wishes to reiterate its earlier view that the completion of the IPO is key to
improving the group’s capital structure which in turn would support its
proposed refinancing exercise of the EBL.
As Tanjung Bin Power Sdn Bhd (TBP), the concessionaire
for the 3 x 700-megawatt coal-fired power plant in Tanjung Bin, Johor, is the
main cash flow contributor to Malakoff Group and the main catalyst for
Malakoff’s IPO plan, the success of its major maintenance plan commenced in
July 2013 is critical towards maintaining the current ratings. Based on the
latest update, the power plant has returned to normal operations; the third and
final generating unit to undergo major maintenance works completed its capacity
testing on March 7, 2014.
MARC views the IPO deferment would not have an
immediate impact on the group’s financial metrics so long as the new listing
date provides sufficient buffer for timely implementation of Malakoff’s
proposed refinancing exercise. The rating agency will continue to monitor the
developments with regard to Malakoff’s IPO progress and will take appropriate
rating action if further elements of uncertainty are introduced into the
group’s risk profile.
Contacts:
Koh Shu Yunn, +603-2082 2243 / shuyunn@marc.com.my; David Lee, +603-2082 2255 / david@marc.com.my.
March 11, 2014
[This announcement is available in the MARC corporate
homepage at http://www.marc.com.my]
---- DISCLAIMER ----
This communication is provided by
Malaysian Rating Corporation Berhad (MARC) on the basis of information believed
by MARC to be accurate and reliable as derived from publicly available sources
or provided by the rated entity or its agents. MARC, however, has not
independently verified such information and makes no representation as to the
accuracy or completeness of such information. Any assignment of a credit rating
by MARC is solely to be construed as a statement of its opinion and not a
statement of fact. A credit rating is not a recommendation to buy, sell, or
hold any security.
© 2014 Malaysian Rating Corporation Berhad
No comments:
Post a Comment
Note: Only a member of this blog may post a comment.