Moody's cuts Kuwait Projects

Moody's Investors Service said it downgraded Kuwait Projects Co. Holding KSC and Kuwait Projects Co., as well as the instruments rating under the $2 billion euro medium-term note program to Baa2 from Baa1. Its short-term issuer rating also was lowered to prime-3 from prime-2.

The company's four majority-owned core operating companies consist of Burgan Bank, United Gulf Bank, Gulf Insurance Co. and Orbit Showtime Network.

The outlook remains negative.

The ratings were lowered by one notch given the asset concentration of the top three holdings, which account for 79% of the company's portfolio, Moody's said. The company also has high exposure to the financial services industry, the agency said.

The agency also said it anticipates cash coverage to weaken from past levels on the back of lower dividend payouts, which is at the low end of expectations.

The ratings also take into account its solid liquidity profile, Moody's added.

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