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| ICRA lowers rating for loans to DP World's two India units |
| BS Reporter / Mumbai Nov 30, 2009, 14:40 IST |
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Heat of troubles for Dubai World has begun to make impact in India. ICRA today downgraded rating to loans extended DP World’s (a transport and logistics arm of Dubai World) two containers terminals – Chennai and Nhava Sheva.
It has placed rating under watch with negative implications on loans to DP World owned three container terminals – Chennai, Nhava Sheva, and one at Mundra in Gujarat.
These loans are backed by an unconditional and irrevocable guarantee from DP World, ICRA has revised the long term rating assigned to the term loans (of Rs 350 crore) of Chennai Container Terminal from LAA (SO) to L A (SO). ICRA has also revised the short term ratings from A1+ to A2+ for CCTL’s Rs 52.6 crore short term non-fund based limits.
The rating action follows downgrading of the long term debt and issuer rating of DP World from A3 to Baa2 by Moody's. Global rating agency has placed the ratings under review for a possible downgrade.
The government of Dubai said it would restructure Dubai World, together with a requested “standstill” on financing to Dubai World and its subsidiary Nakheel Properties apart from extending the maturities until end of May 2010.
Rating also takes into account fact that the restructuring process announced for Dubai World does not include the debt obligations of DP World. The revision in the standalone rating is due to weakened credit quality of its ultimate parent DP World.
Similarly, rating to Nhava Sheva International Container Terminal’s term loans (Rs 200 crore) has been downgraded to from LAA to LA. Also rating to Rs 150 crore short term non-fund based limits has been down-graded from A1+ to A1.
ICRA has assigned LA (So) rating to Mundra International Container Terminal (MICTPL) Rs 800 crore long term borrowings plan and A2 to Rs 60 crore non-fund limits.
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