Moody’s lowers Mapletree view to negative

Moody's Investors Service said it changed Mapletree Logistics Trust's outlook to negative from stable.

The agency also said it affirmed the trust's Baa1 issuer rating and the Baa3 rating on its subordinated perpetual securities.

Moody's also said it affirmed the provisional Baa1 senior unsecured rating on the medium-term note programs of MapletreeLog Treasury Co. Pte. Ltd. and MapletreeLog Treasury Co. (HKSAR) Ltd. The outlooks on these companies also were revised to negative from stable.

The agency also said it affirmed the Baa1 rating on the notes drawn down from the program under Mapletree.

The outlook reflects expectations that Mapletree’s credit profile will weaken beyond the parameters of its Baa1 ratings, following its proposed acquisition of four logistics properties in Australia, Moody’s said.

The company announced Dec. 15 that it will acquire four logistics properties in the Australian state of Victoria for a total acquisition cost of A$152.1 million, the agency said.

The acquisition will be largely funded with debt, Moody’s noted.

Post-transaction leverage will weaken to 45.4% from 43.8% as of Sept. 30, 2016, which exceeds the downgrade trigger of 45%, the agency explained.

From an earnings capacity perspective, Moody's said it expects the trust’s leverage also will stay at about 8.5x to 8.7x over the next 12 to 18 months.

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