MARC places Petra Perdana on 'developing' watch

KUALA LUMPUR: PETRA PERDANA BHD [] on Wednesday, Dec 16 was placed on ratings watch "developing" by the Malaysian Rating Corp Bhd (MARC).

Local rating agency MARC said in a statement that it has placed its A+ rating on Petra Perdana Berhad's (Petra Perdana) RM800 million Dual Currency Revolving Facility on MARCWatch Developing following the company's announcement that it had divested a 25.03% stake in Petra Energy Berhad (Petra Energy).

It said the divestment will reduce Petra Perdana's shareholdings in Petra Energy to 29.59% and will result in deconsolidation of Petra Energy from Petra Perdana's accounts. It added that Petra Energy had contributed 59.3% of the group's profit before tax for the nine-month period ended Sept 30, 2009.

"Petra Perdana has indicated that the net proceeds will be used to pare down bank borrowings and other financial obligations.

"The rating will remain on MARCWatch pending an evaluation of the impact of the divestment of Petra Energy shares on Petra Perdana's credit profile which had not been taken into consideration in MARC's affirmation of Petra's rating on Nov 26, 2009," the rating house said.