Nov 25, 2010

Energi Mega delays US$275 mio bonds

Standard & Poor's Ratings Services said today that it had placed its B- corporate credit rating on oil and gas producer PT Energi Mega Persada Tbk. (EMP) on credit watch with negative implications. 
"We also placed our B- issue rating on the proposed senior secured notes issued by EMP International Holdings Pte. Ltd. on credit watch with negative implications. EMP and some of its operating subsidiaries guarantee the notes."
"We placed the rating on EMP on credit watch because the company's proposed issuance of US$275 million senior secured notes is taking longer than we had expected to close," said S&P credit analyst Andrew Wong in a press statement today.
EMP aims to refinance existing bank loans and resolve outstanding covenant compliance issues with the proposed issuance.
"Without the refinancing, covenant breaches are likely to persist, in our view, indicating that the company's credit profile would not be consistent with the existing rating on EMP," said Wong.
We aim to resolve the credit watch when more information regarding issuance of the proposed notes and resolution of existing covenant breaches is available

Disclosure: No position at the stock mentioned above.

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