Nagacorp’s Us-dollar debt notes rated B+ by S&P
PETALING JAYA: Malaysian tycoon Tan Sri Chen Lip Keong’s Cambodia-based Nagacorp Ltd’s proposed US dollar senior notes have been rated ‘B+’ by S&P Global Ratings.
The rating agency said the proposed notes by Nagacorp (B+/stable) were subject to its review of the final issuance documentation.
“We expect Nagacorp to use the net proceeds to fully repay its existing Us$300mil senior unsecured notes due May 2021 and for general corporate purposes.
“This will extend the company’s debt maturity profile and improve its liquidity, which we assess as adequate. Nagacorp’s casinos have remained closed since April 1, 2020.
“However, we believe Nagacorp’s strong cash balance of Us$473mil as of March 31,2020 can support its business for more than two years, even assuming zero revenue and minimum capital expenditure for 2020,” it said in a statement yesterday.
S&P Global Ratings said the rating on the notes was the same as the issuer credit rating on Nagacorp because it saw no elements of subordination risk in the company’s capital structure.
As of March 31, 2020, Nagacorp’s capital structure consisted only of the existing Us$300mil senior unsecured notes at the holding company level.
“We expect Nagacorp to sustain its dominant market position in the Cambodian gaming industry and continue to ramp up its Naga2 operations.
“We also expect Nagacorp to appropriately manage the refinancing or redemption of its unsecured notes over the next 12 months,” S&P Global Ratings said.
According to Nagacorp’s website, it is the largest hotel, gaming and leisure operator in Cambodia, and the company has been listed on the Stock Exchange of Hong Kong since 2006.
The casino group became the first company with operations in Cambodia to become a public-listed entity, as well as the first gaming-related company traded on the stock exchange.
It said its flagship, Nagaworld, is Phnom Penh’s only integrated hotel-casino entertainment complex.
It added that it had a 70-year casino licence that will run till 2065, as well as exclusivity on gaming operations within a 200-km radius of Phnom Penh which extends to 2045.