Moody’s gives Hibiscus, bonds B1

Moody’s Investors Service said it gave provisional B1 ratings to Hibiscus Petroleum Bhd. and its planned dollar-denominated senior secured bonds to be issued by Hibiscus Capital Ltd., a wholly-owned subsidiary of Hibiscus. Hibiscus Petroleum and some of its subsidiaries will guarantee the bonds.

The ratings are provisional and depend on Hibiscus acquiring a portfolio of oil and gas assets in Malaysia and Vietnam from Repsol SA and its planned bond offering, Moody’s said.

"The (P)B1 CFR reflects Hibiscus' credit profile incorporating the proposed acquisition and the funding plan. The provisional rating benefits from the company's strong credit metrics post-acquisition, but is constrained by Hibiscus' small, albeit improving, scale of production and reserves with significant geographic concentration, modest reserve life and exposure to volatile oil prices," said Hui Ting Sim, a Moody's analyst, in a press release.

The proceeds will be initially kept in an escrow account and will ultimately be used to fund the planned acquisition and other general working capital purposes.

The outlook is stable.

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