RAM Ratings assigns final AAA/Stable rating to Glacier Assets’ proposed RM555 mil Senior Notes

Published on 17 Mar 2021.

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RAM Ratings has assigned a final rating of AAA/Stable to the proposed RM555 mil Senior Notes to be issued under Glacier Assets Berhad’s (Glacier Assets or the Issuer) Asset-backed Medium-Term Notes facility (the MTN Facility). The proposed issuance involves seven tranches of Senior Notes with yearly repayments and an unrated tranche of Junior Notes. Ranking above the Junior Notes, the Senior Notes will be backed by receivables due from Syarikat Pengeluar Air Sungai Selangor Sdn Bhd (SPLASH or the Obligor).

Glacier Assets was set up by Gamuda Water Sdn Bhd (Gamuda Water or the Originator) to monetise the balance of receivables under the Termination and Settlement Agreement1 (TSA) between Pengurusan Air Selangor Sdn Bhd (Air Selangor), SPLASH and Gamuda Water. Forming a key part of the resolution of long drawn-out negotiations on Selangor’s water restructuring exercise, the TSA relates to the settlement of receivables owing from SPLASH to Gamuda Water for the supply of treated water and operations and maintenance works performed. Although the primary payment obligation lies with SPLASH, Air Selangor – its parent company – will pay Gamuda Water any missed instalments within a predefined period of the scheduled due dates. In this regard, the rating assigned to the Senior Notes is underpinned by Air Selangor’s credit profile which in turn mirrors that of the Selangor state government.

In assigning the final rating, we have reviewed all relevant transaction documents as well as assumptions applied in the transaction’s cashflow model. We find these to be in line with our expectations when we assigned the preliminary rating on 3 December 2020. The Senior Notes will be backed by the remaining eight yearly instalments of the Settlement Sum and Cut-Over Sum totalling RM613.96 mil, with interest charges of 5.25% per annum, to be sold to the Issuer by way of absolute legal assignment. 

RAM will monitor the transaction’s performance on a regular basis via semi-annual reports on designated account balances, including details on amounts held in permitted investments. We will keep the rating under surveillance as long as the Senior Notes remain outstanding.

As amended and supplemented by the Supplemental Termination and Settlement Agreement dated 18 May 2020.


Analytical contacts
Lee Siew Xuen
(603) 3385 2539

Tan Han Nee
(603) 3385 2529

Media contact
Padthma Subbiah
(603) 3385 2577


The credit rating is not a recommendation to purchase, sell or hold a security, inasmuch as it does not comment on the security’s market price or its suitability for a particular investor, nor does it involve any audit by RAM Ratings. The credit rating also does not reflect the legality and enforceability of financial obligations.

RAM Ratings receives compensation for its rating services, normally paid by the issuers of such securities or the rated entity, and sometimes third parties participating in marketing the securities, insurers, guarantors, other obligors, underwriters, etc. The receipt of this compensation has no influence on RAM Ratings’ credit opinions or other analytical processes. In all instances, RAM Ratings is committed to preserving the objectivity, integrity and independence of its ratings. Rating fees are communicated to clients prior to the issuance of rating opinions. While RAM Ratings reserves the right to disseminate the ratings, it receives no payment for doing so, except for subscriptions to its publications.

Similarly, the disclaimers above also apply to RAM Ratings’ credit-related analyses and commentaries, where relevant.

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