Axiata Group’s sukuk drawdown rated ‘BBB’ by S&P’s
SINGAPORE: Standard & Poor’s Ratings Services (S&P’s) today assigned a ‘BBB’ longterm issue rating to a proposed sukuk drawdown from the US$1.5 billion senior unsecured multicurrency sukuk programme of Axiata Group Bhd.
Axiata, a Malaysia- based telecommunications company, intends to use the proceeds from the sukuk issuance for merger and acquisition activities and general corporate purposes.
It recently acquired Ncell Pvt Ltd, which is Nepal’s largest mobile operator by revenue and subscriber market share.
In a statement here, S&P’s said Axiata’s debt-to-EBITDA (earnings before interest, taxes, depreciation and amortisation) ratio will be close to two times following the acquisition and with rising capital expenditure.
“However, we expect the company to take the necessary steps to sustain its leverage below two times.
Our view is based on the company’s record of maintaining its financial position despite acquisitions and investments over the past few years.
“We expect Axiata to maintain a stable operating performance over the next 12-24 months.
“We also anticipate that the company will maintain strong cash flows and its existing financial position over the period,” it said.
The credit-rating agency said the rating on the sukuk drawdown is subject to its review of the final issuance documentation.
The notes will be issued by Axiata SPV2 Bhd, a whollyowned unit of Axiata.
S&P’s also affirmed the ‘BBB+’ rating with a stable outlook, and the ‘axA+’ ASEAN regional scale rating on Axiata Group. — Bernama