S&P downgrades Sime Darby

Standard & Poor’s said it lowered the long-term corporate credit rating on Sime Darby Bhd. to BBB+ from A-.

The outlook is negative.

The agency also said it lowered the long-term issue ratings on the senior unsecured notes under the company’s guaranteed medium-term notes program to BBB+ from A-.

S&P also said it lowered the long-term Asean regional scale ratings on Sime Darby and the senior unsecured notes the company issued to axA+ from axAA-.

The downgrades reflect uncertainties in the implementation of Sime Darby’s de-leveraging measures, the agency said.

These measures are important to offset the impact of higher debt from the company’s acquisition of New Britain Palm Oil Ltd. in 2015, S&P added.

The company’s capability to generate cash also could remain modest over the next 12- to 18-months, making debt-reduction demanding, the agency said.

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