Moody’s drops Western Liberty Group

Moody's Investors Service said it downgraded the senior secured rating of Western Liberty Group Finance Pty Ltd. (WLGF) to Ba2 from Ba1.

The outlook remains negative.

WLGF is the financing vehicle for Western Liberty Group Pty Ltd., which is a special purpose entity set up to design, construct, operate, and provide long term maintenance for Perth Courts in Western Australia under a public private partnership.

"The rating downgrade reflects continued refinancing challenges facing WLGF due to prevailing credit margins remaining materially above the levels incorporated in the original rating," Moody's analyst Mary Anne Low said in a news release.

WLGF has outstanding bonds of A$77 million, which were issued in 2006 at a credit margin that remains below those prevailing in the current market. The bond has a scheduled maturity in 2018 and a legal maturity in 2020.

"These refinancing challenges, plus WLGF's extremely high financial leverage, position the company's credit profile at a level that is no longer consistent with its previous rating," Low added in the release.

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