Excelcomindo's credit rating raised to BB

as published in Bisnis Indonesia website

Monday, 21/12/2009 12:13 WIB

Excelcomindo's credit rating raised to BB

Irvin Avriano

JAKARTA (bisnis.com): Fitch Ratings increased the long-term local and foreign currency credit ratings PT Excelcomindo Pratama Tbk from level from BB- to BB levels after completion of the rights issue process (PUT/limited public bidding). Ranking outlook is determined on a stable level.

Rights issue managed to raise funds for Rp2,8 trillion in the ratio 1:5 times. Increased ratings reflect the strong relationship between the company and its majority shareholder, Indocel Holdings Sdn Bhd.

Indocel Holdings is a subsidiary Axiata Group Bhd, which 100% shares of the company's stock owned by the Malaysian listed company. The increase of the ratings was also in accordance with Fitch's methodology related to ranking parent relations and subsidiary businesses.

"Parent participation in a rights offering business Excelcomindo by Indocel which owned 100% by Axiata, and commitment Axiata as the standby purchaser in the corporation's action, indicate increased support for the consistent factor in the ranking," said Fitch Senior Director in Telecommunications, Media, and Technology Team for Asia Pacific Vicky Melbourne in a press release that published today.

Excelcomindo is the largest subsidiary nondomestic and the main contributor in Axiata's business income. Contributions are reflected from the support of 31% EBITDA during semester I/2009 which also showed an important and strategic position of Excelcomindo in Axiata.

Considerable support was also planning to be realized through changes in the issuer's name into PT XL Axiata Tbk in the next 2 months that are still waiting for approval from the Ministry of Justice and Human Rights.

Stable ranking outlook indicates a lower stable level of net debt to funds from the results indicate 'rights issue' will be used to pay off some companies' debt. (tw)