Fitch affirms Ranhill

Fitch Ratings said it affirmed Ranhill Bhd's long-term foreign-currency issuer default rating at B, along with the B- senior unsecured rating on the $220 million notes due 2011 issued by Ranhill Ltd. and guaranteed by Ranhill and its subsidiary, Ranhill Engineers & Constructors Sdn Bhd.

The outlook is stable.

The ratings reflect the risks and characteristics of the engineering and construction industry, the agency said, because of Fitch's focus on that side of the business. Ranhill's subsidiary has a limited ability to upstream cash generated from its power and water assets due to restrictive covenants attached to project loans, Fitch said.

The ratings also factor in the company's weak financial profile once the results of its power and water divisions are removed, the agency said.

However, the ratings do reflect the operating track record of Ranhill and the experienced senior management team of the company, Fitch said.

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