S&P gives MISC notes BBB

S&P said it gave a BBB long-term issue rating to MISC Bhd.'s planned U.S. dollar notes to be issued from its $3 billion global medium-term note program. MISC Capital Two (Labuan) Ltd., a wholly owned financing subsidiary of MISC will issue the notes. MISC, rated BBB+, will guarantee the notes.

“We rate the proposed issuance one notch below our long-term issuer credit rating on MISC because we believe that unsecured debtholders will be significantly disadvantaged relative to senior debtholders, suggesting meaningful structural subordination risk. As of Dec. 31, 2021, the company's capital structure consisted of Malaysian ringgit (MYR) 4.1 billion in unsecured debt and MYR 12.9 billion in secured instruments. MISC's ratio of secured debt to total debt was 76% and could fall below 60% following the proposed issuance,” S&P said in a press release.

MISC will use the proceeds for general corporate purposes, including financing capital expenditure, working capital and refinancing borrowings.

The outlook is stable.

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