Bowsprit deal benefits buyers more than seller

THE recent lateral shift in the ownership of First Reit's manager, Bowsprit Capital, from Lippo Karawaci to OUE and OUE Lippo Healthcare (OUELH) may benefit the buyers more than the vendor.

Each side has its reasons for the transaction, of course. For Lippo, the sale is merely one small part of its larger asset sales plan.

Credit ratings agency Moody's on Sept 19 downgraded the corporate family rating of Lippo because it expects the group's operating cash flows at the holding company level to weaken further over the next 12 to 18 months, partly due to its foreign-denominated debt impacted by the depreciating rupiah against the greenback and rising rates.