S&P gives BB+ to PTTEP securities

S&P said it assigned a BB+ long-term issue rating to two proposed subordinated perpetual capital securities to be issued by PTTEP Treasury Center Co. Ltd. (PTTEPTC).

PTTEPTC is a financing subsidiary set up by PTT Exploration & Production PCL (PTTEP: BBB+/stable/--; axA+/--).

PTTEPTC is offering two hybrid securities in conjunction with a tender offer for the outstanding $1 billion hybrids PTTEP issued in 2014. Participating holders will have an option to receive either of two proposed hybrids: (a) Hybrids with the same terms and substance as the outstanding 2014 hybrids but with PTTEPTC as the issuer instead of PTTEP, and offered in a like-kind exchange exercise (like-kind hybrids); or (b) new hybrids with a first call date in 2022 (new hybrid securities).

The terms and conditions on subordination, optional deferral of distributions, capital replacement of the proposed hybrid securities, and management's intent to keep hybrid capital as a permanent element of the capital structure are similar to those of the outstanding $1 billion hybrids PTTEP issued in 2014, S&P said.

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