S&P rates CK Infrastructure securities BBB

S&P said it assigned a BBB rating to the proposed guaranteed perpetual capital securities to be issued by Phoenix Lead Ltd. and guaranteed by CK Infrastructure Holdings Ltd.

CK Infrastructure's total outstanding hybrid securities after this proposed issue will still be within 15% of its total capitalization, the agency explained.

The securities are considered to have intermediate equity content, S&P noted. Therefore, the agency said it will treat 50% of the principal as equity and 50% of the distributions as dividends in calculating the company's financial ratios.

The securities are rated two notches below the A- long-term corporate credit rating on CK Infrastructure, reflecting the securities' subordinated status and optional deferability feature, S&P said.

The company is expected to use some of the proceeds to finance the planned acquisition of Ista Luxemburg GmbH, the agency said.

S&P also said it believes CK Infrastructure will remain a core subsidiary of CK Hutchison Holdings Ltd.

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