Fitch: PTT unaffected

Fitch Ratings said said that the bid by PTT Exploration and Production Public Co. Ltd., the exploration and production arm of PTT PCL, for Cove Energy plc has no immediate impact on PTT's long-term foreign- and local-currency issuer default ratings of BBB and A-, respectively.

The bid, if accepted by Cove's shareholders, would increase PTT's financial leverage, as measured by adjusted net debt to operating EBTIDAR, to close to 2.0x in 2012 from 1.4x in 2011, which is consistent with the current ratings and is expected to be maintained through to 2015, according to the agency.

PTT's ratings reflect its dominance in Thailand's gas and oil industry, as well as its strategic importance and function as a policy vehicle for the country's energy security and development, the agency said.

PTT's credit profile is tempered by its vulnerability to fluctuations in commodity prices, significant capital expenditure plans, negative free cash flow (after dividend payout) generation expected in the next two years, exposure to regulatory and political risks, as well as some foreign exchange risk, the agency noted.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.