Fitch rates Lippo Karawaci

Fitch Ratings said it assigned an expected rating of BB- to PT Lippo Karawaci Tbk.'s proposed dollar-denominated senior unsecured notes.

The notes will be issued by Lippo's wholly owned subsidiary, Theta Capital Pte Ltd. and guaranteed by Lippo and its subsidiaries.

The proposed notes are rated at the same level as Lippo's senior unsecured rating as they represent the company's unconditional, unsecured and unsubordinated obligations, Fitch said.

Lippo said it expects to utilize the proceeds from a successful issuance to buy back its existing $403.3 million senior unsecured 6 1/8% coupon notes due in 2020, which will push back a bulk of its debt maturities, the agency said.

The company's earliest significant debt maturity will then be in 2022, when its $410 million senior unsecured 7% coupon notes fall due, Fitch said.

The ratings reflect a view that the slowdown in contracted sales in 2015 and the first six months of 2016 is mostly cyclical and the company's credit profile remains intact, the agency said.

This is supported by its strong recurring cash flows from its leading domestic hospital network, retail malls, asset management fees and two Singapore-listed REITs, Fitch said.

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