Moody's may up Excelcomindo

Moody's Investors Service said it placed the B2 foreign currency rating for PT Excelcomindo Pratama (Excelcomindo)'s guaranteed debt on review for possible upgrade.

The action follows Telekom Malaysia Berhad's (A3 on review for possible upgrade) proposed initial acquisition of a 27.3% stake in Excelcomindo as well as majority management and board control.

Moody's noted that Telekom Malaysia - through its wholly owned international investment arm, TM International (L) Ltd. - has entered into agreement with the Rajawaii Group to acquire the 27.3% stake for a total cash consideration of $314 million (approximately RM1,193.2 million) on Dec. 8. TMB will also receive the option to acquire additional shares in Excelcomindo in excess of a majority shareholding.

Moody's said Excelcomindo is likely to benefit from a larger and financially stronger shareholder which is intended to move to majority shareholder control. The review will focus on the likely operational, management and financial support forthcoming from Telekom Malaysia.

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