KUALA LUMPUR, April 21 — Moody’s Investors Service has affirmed Axiata Group Bhd’s (Axiata) Baa2 issuer rating and Baa3 baseline credit assessment.
The rating agency said it has also affirmed the provisional (P)Baa2 senior unsecured ratings on the sukuk issuance programme established by Axiata SPV2 Bhd and the medium-term note programme established by Axiata SPV5 (Labuan) Ltd, as well as the Baa2 rating on all backed senior unsecured notes issued by the two entities, which are wholly owned subsidiaries of Axiata.
“The rating outlooks remain stable,” it said in a statement today.
It said the rating affirmation reflects Moody’s view that Axiata’s recently announced acquisition of 2,973 towers from PLDT Inc (Baa2 stable), for 42 billion Philippine pesos (RM3.44 billion) can be accommodated within its credit profile.
Vice-president and senior analyst Nidhi Dhruv noted that the debt-funded acquisition came close on the heels of Axiata’s acquisition of Link Net and towers from Mindscape.
“As such, the acquisition of PLDT’s towers will push the leverage higher to 2.7 times to 2.8 times over the next one to two years, giving the company limited flexibility for further large debt-funded acquisitions at the current rating level.
“Nonetheless, the tower acquisition gives Axiata’s 63 per cent-owned tower company, edotco, an early mover advantage in the nascent and growing independent tower market in the Philippines. With its total holding of over 3,000 towers, edotco will be the leading tower operator in Philippines,” she said.
The rating agency said the stable outlook reflects Moody’s expectation that Axiata will maintain its solid operating and financial profiles, given the increasing dividend contributions from its international subsidiaries.
“Moody’s expects dividends from Celcom Digi Bhd to broadly offset the loss of dividends from Celcom and that Axiata will not guarantee any debt at the merged company,” it said. — Bernama