S&P Lowered Gajah Tunggal and MNC Investama Rating to ‘B-’

On rating front, S&P have downgraded the rating on MNC Investama, Tbk (BHIT IJ) and Gajah Tunggal, Tbk (GJTL IJ) to “B-” due to rising financing risks. The outlook for Gajah Tunggal was placed at CreditWatch while MNC Investama maintained at negative. The downgrade on both companies were mainly because of higher risk financing as the companies have yet delivered credible refinancing strategy to deal with their lumpy debt maturity through 2018 while their capital spending remain high. MNC Investama inline with its operating have USD900Mn in bank loans and bonds maturing through 2018. While Gajah Tunggal has a whooping USD 500 million notes due through 2018 amidst high capital spending and lack of cash build up.

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