Bangkok--Jun 14--Moody's Investors Service
Moody's Investors Service has assigned a provisional (P)Baa3 issuer rating to Thai Olefins Public Company Ltd (TOC). At the same time, Moody's has assigned a provisional (P)Baa3 foreign currency long-term rating to TOC's proposed US$ unsecured bonds, the proceeds of which are intended to primarily finance the company's expansion plans. Moody's expects to assign a definitive Baa3 rating upon
completion of the bond issuance. The ratings outlook is stable.
Despite TOC's secured debt to total debt ratio will remain above 30%
following the proposed bond issuance, the (P)Baa3 ratings have not factored into legal subordination as Moody's anticipates TOC to lower its secured debt to total debt ratio to below 20% by 2006 and 15% by 2007.
The above is expected to be achieved by either converting certain of its
secured facilities into unsecured facilities or replacing its undrawn secured bank facilities by a new unsecured committed credit facility the terms of which are not more onerous than the existing loans' covenants. If either event does not take place within 3 months such that secured debt to total debt ratio is unlikely to fall below 20% by 2006, the (P)Baa3 ratings will be downgraded. End.