Fitch: Abans issue BBB+(lka)

Fitch Ratings said it assigned a national long-term rating of BBB+(lka) to Abans plc’s proposed senior unsecured debenture issue of up to 1.5 billion in Sri Lankan rupee.

The debentures will have tenors of three, four and five years and carry fixed and floating coupons, Fitch said.

The debentures are to be listed on the Colombo Stock Exchange with the proceeds to be used to refinance existing debt, the agency said.

The senior unsecured debt is rated at the same level as the company’s national long-term rating as the debentures rank equally with other senior unsecured obligations, Fitch said.

The agency said it expects demand for consumer durables to be sluggish in the next six to 12 months due to rising interest rates, increase in taxes on consumer durables and a depreciating Sri Lankan rupee, which raises the prices of imported goods that account for the majority of products sold by Abans.

However, Fitch said it believes the long-term fundamentals driving demand for the consumer-durables sector is still strong.

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