Moody's eyes LimakPort for downgrade

Moody's Investors Service said it placed on review for downgrade the B3 rating on the senior secured notes issued by Limak Iskenderun Uluslararasi Liman Isletmeciligi AS (LimakPort). The outlook has been changed to ratings under review from stable.

“The review for downgrade of LimakPort's rating reflects the uncertainty around damage to the port's infrastructure and the timeline to resume operations following the 7.7 and 7.6 magnitude earthquakes in Turkiye on Feb. 6,” Moody’s said in a press release.

Inside the earthquake area, tremors hammered the port of Iskenderun where LimakPort is based. After the quake, a fire broke out at the port, which was put out, and the extent of the damage is unknown. Operations at the port have not resumed.

“It is currently unknown what mitigation could be provided by any insurance claims. According to the company's Offering Memorandum, LimakPort maintains insurance including for property damage and business interruption. The company's insurance policies are fronted by Turkish insurers as per the regulation and re-insured by international insurance companies. In terms of liquidity, Moody's understands that LimakPort has cash of around $51 million,” the agency said in a statement.

The review will consider the port’s ability to restore its damaged infrastructure and restart operations, the costs of repairs, the possible loss of customers, the potential for the port to benefit from reconstruction efforts and the potential for any insurance and any other mitigating factors.

“Any rating downgrade could be more than one notch,” Moody’s said.

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