Tata Power's ratings to remain under review for possible downgrade, says Moody's |
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Mon, 02 Apr 2007 11:49
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LONDON (AFX) - Moody's Investors Service said it continues to review for possible downgrade Tata Power Co Ltd's (TPC) 'Ba1' corporate family rating, and 'Ba2' senior unsecured debt rating.The rating action follows the company's announcement that it plans to buy 30 pct stakes in two major Indonesian thermal coal producers and a related trading company.The company expects to acquire the Indonesian companies through an offshore special purpose vehicle, while funding will be through a mix of debt in the SPV, internal accruals and borrowings from TPC itself.'To the extent that the acquisition is majority debt-funded, TPC's consolidated debt level could double from 1 bln usd as at March 31, thereby further weakening its credit metrics,' Jennifer Wong, Moody's Analyst said.Wong added the negative financial impact of this transaction has to be considered in conjunction with the company's overall expansion plan and changing risk profile.Moody's had originally placed Tata Power on review for possible downgrade on January 30.newsdesk@afxnews.comami/akuCOPYRIGHTCopyright AFX News Limited 2007. All rights reserved.The copying, republication or redistribution of AFX News Content, including by framing or similar means, is expressly prohibited without the prior written consent of AFX News.AFX News and AFX Financial News Logo are registered trademarks of AFX News Limited
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