S&P Global Ratings lowered the long-term corporate credit rating of Indonesia-based PT MNC Investama Tbk to CCC- from CCC and placed all the company's ratings on CreditWatch with negative implications.
The rating agency said Feb. 2 that the ratings downgrade reflects its view of a growing likelihood that the company could take a corporate action that S&P interprets as a distressed exchange over the next few months, primarily due to the lack of progress on refinancing the company's US$365 million notes maturing in May.
S&P notes that the company has not executed the refinancing plan outlined in December 2017.
The CreditWatch placement reflects the likelihood that S&P will lower the company's corporate credit rating to CC, indicating an imminent default, in the next few weeks, unless the company refinances its maturing notes.
The ratings may be downgraded to CC if the default is expected to be virtually certain. S&P believes that this would most likely be driven by MNC Investama taking an action that is construed as a distressed exchange and tantamount to default.
Conversely, the ratings could be upgraded if the Indonesian company fully refinances its notes over the next few weeks and extends its debt maturity profile.
S&P Global Ratings and S&P Global Market Intelligence are owned by S&P Global Inc.
