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View all search resultsFitch downgrades Bakrie Telecom to RD
Fitch Ratings hasdowngraded Indonesia-based PT Bakrie Telecom Tbkâs (BTEL) long term foreign-and local-currency issuer default rating to Restricted Default (RD) from C(highly vulnerable), the rating agency said Friday
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F
itch Ratings hasdowngraded Indonesia-based PT Bakrie Telecom Tbk's (BTEL) long term foreign-and local-currency issuer default rating to Restricted Default (RD) from C(highly vulnerable), the rating agency said Friday.
The US$380 million May 2015 bond fully guaranteed by BTEL has also been affirmed at C while the recovery rating on the bond has been downgraded to RR5 from RR4, the rating agency said.
The downgrade to RD follows the uncured default on a coupon payment in November 2013 and no subsequent coupon payment or public announcement about the progress of debt restructuring discussions with its creditors, Fitch said in a statement.
Fitch believes that a distressed debt exchange (DDE) is inevitable, which is likely to lead to a significant loss for holders of the $380 million bond. This bond is currently trading at 11 cents to the dollar, indicating high probability of a material reduction in economic value.
The rating agency said that a lower recovery rating of RR5 on the bond reflected a decline in the enterprise value of the business as 2014 EBITDA would probably fall to around Rp 600 billion ($51.6 million)-Rp 700 billion from Rp 911 billion in 2013.
