Published on 03 November 2014
RAM Ratings has lifted the Negative Rating
Watch on the rating of New Pantai Expressway Sdn Bhd’s (NPESB or the
Company) RM250 million Junior Notes and downgraded the rating of the
facility to BBB2/Stable (from AA3(s)). As expected, the unconditional
and irrevocable corporate guarantee on the Junior Notes from IJM
Corporation Berhad (IJM) expired along with the Senior Notes on 31
October 2014. Following the expiry of the corporate guarantee, the
Junior Notes no longer carries an enhanced rating and thus, reflects its
standalone issue rating.
The BBB2/Stable rating of the Junior Notes reflects
its current moderate debt-coverage indicators; NPESB is expected to
register a minimum finance service coverage ratio (FSCR) (with cash,
post-distribution) of 1.62 times over the remaining tenure of the Junior
Notes. That said, the Company’s projected average annual pre-financing
cashflow generation of about RM120 million over the next 3 years,
coupled with its cash balance of RM207.5 million as at end-September
2014, is expected to sufficiently support lumpy principal repayments of
the Junior Notes.
Meanwhile, we have received confirmation from the
Facility Agent that NPESB fully redeemed its RM490 million Senior Notes
on 31 October 2014. Accordingly, we have withdrawn the AA3/Stable rating
of the said facility and no longer have any rating obligation in
respect of it.
This rating announcement follows our last rating action on 23 October 2014.
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