Bangkok--10 Feb--Moody's
Approximately US$350 million of debt securities affected
Moody's Investors Service has today assigned the B2 senior secured debt rating on the US$350 million 11.5% notes due 2015 issued by Star Energy Geothermal (Wayang Windu) Limited ("Star Energy").
The provisional status of the rating has been removed following the completion of the bond issue. The outlook on the rating is stable.
The proceeds from the issue will refinance outstanding debt under an existing bank facility, fund an interest reserve account for the bond,and partially fund developmental costs related to the proposed Unit 3 expansion.
Moody's notes that the final structure of the notes has changed with the addition of a fixed principal amortization schedule of US$12.5 million payable semi-annually in the third and fourth years, should Star Energy not be able to deliver evidence showing that development of Unit 3 commenced prior to January 1, 2013.
Moody's sees no rating impact, as the amortizing feature will reduce some of the refinancing risk at maturity and spread it out across earlier years, in the event Unit 3 does not go forward. Furthermore, the tightening of the Fixed Charge Coverage Ratio and Limitation of Restricted Payment covenant and the addition of the prohibition on payments and modifications to the shareholder loan agreement or subordination deed will provide additional protection to the bondholders.
The principal methodology used in rating Star Energy was Moody's Rating Methodology for Power Generation Projects, published in December 2008, which can be found at www.moodys.com in the Rating Methodologies sub-directory under the Research & Ratings tab. Other methodologies and factors that may have been considered in the process of rating this issuer can also be found in the Rating Methodologies sub-directory on Moody's website
The last rating action on Star Energy was on 26 January 2010, when Moody's assigned the company a B2 corporate family rating and a (P)B2 senior secured bond rating.
Star Energy Geothermal (Wayang Windu) Limited (Star Energy) is one of the largest geothermal power stations in Indonesia, with 227 MW of operational capacity. It operates a geothermal energy resource area on the island of Java. Star Energy began commercial operations in June 2000 with Unit 1, a 110MW geothermal turbine-generator unit. The company increased its installed generation capacity by 117MW in March 2009 with the start of commercial operations at Unit 2, raising total installed capacity to 227MW. Star Energy has the right to develop and sell up to 400MW to PLN.
Hong Kong
Jennifer W. Wong
Asst Vice President - Analyst
Corporate Finance Group
Moody's Asia Pacific Ltd.
JOURNALISTS: (852) 2916-1150
SUBSCRIBERS: (852) 3551-3077
Hong Kong
Gary Lau
Managing Director
Corporate Finance Group
Moody's Asia Pacific Ltd.
JOURNALISTS: (852) 2916-1150
SUBSCRIBERS: (852) 3551-3077