S&P cuts GLP, GLP China to junk

S&P said it lowered its ratings for GLP Pte. Ltd. (GLP) and GLP China Holdings Ltd. and their senior unsecured notes to BB from BBB-. The agency also downgraded their perpetual notes to B+ from BB. S&P subsequently withdrew its GLP and its subsidiary GLP China ratings and negative outlook at the group's request.

“GLP's credit quality has deteriorated due to the delays in executing its asset monetization strategy. In our view, GLP is unlikely to meet its target of completing the monetization of a substantial portion of logistics assets in China by end-2023. GLP undertook a strategic initiative in early 2023 to monetize these assets to a strategic investor by end-2023. It sought to reduce its proportion of lumpy non-recurring EBITDA significantly from 2024 onward,” the agency said in a statement.

The delay in asset sales has protracted the planned debt reduction. “This has increased GLP's reliance on short-term debt funding in 2023, and added pressure to its liquidity position,” S&P said.

S&P said it lowered its forecast for 2023 full-year net proceeds from asset monetization to $3.9 billion, from $5 billion-$7 billion and estimates GLP will collect about $2.8 billion in net proceeds in the second half of 2023.

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