S&P: Indosat on positive watch

Standard & Poor's said it placed its BB long-term corporate credit rating on PT Indosat Tbk. and the BB rating on the company's guaranteed senior unsecured notes on CreditWatch with positive implications.

At the same time, the agency said it placed the axBBB- ASEAN scale long-term rating on Indosat on CreditWatch with positive implications.

The agency said the CreditWatch action reflects its view that Indosat's liquidity position could benefit from the company's sale of 2,500 towers to PT Tower Bersama Infrastructure Tbk.

"In addition to the proposed sale, Indosat has tied up credit facilities over the past six months. These factors should improve the company's liquidity," said S&P credit analyst Mehul Sukkawala in a news release. "The company also expects to cut costs and lower its capital expenditure with the tower sale. However, we do not expect Indosat's leverage to improve significantly due to the tower sale because we will factor in the present value of lease obligations as debt while assessing the company's financial performance."

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