MISC Cap's US$1.55b loan facility rated 'BBB'

A US$1.55 billion syndicated loan facility by special purpose vehicle MISC Capital (L) Ltd has been given a "BBB" long-term issue rating by Standard & Poor's Ratings Services.

This loan is guaranteed irrevocably and unconditionally by MISC Bhd.

"The group expects to use the proceeds for refinancing its existing facility. We believe this would improve the company's debt maturity profile and support our liquidity assessment," the ratings agency said on Wednesday.

"The rating on MISC reflects the Malaysia-based company's stable cash flows from liquefied natural gas transport and non-shipping businesses. It also reflects strong support from the company's 62.7-per cent owner, Petroliam Nasional Bhd."

Even so, the agency noted the "volatile and capital-intensive conditions in the shipping industry", as well as "MISC's negative free operating cash flow".

"Despite the industry's volatile conditions, we expect the company to maintain a ratio of debt to Ebitda of 3.5x-4.0x over the coming one to two years," the agency said.