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LEKAS’s C2/Negative-rated Junior Sukuk restructuring and redemption further extended
Published on 18 Aug 2023.
Lenders have granted Lebuhraya Kajang-Seremban Sdn Bhd (LEKAS or the Company) another extension for the repayment of its RM633 mil Junior Sukuk Istisna’ (2007/2025) and RM460 mil Redeemable Convertible Secured Islamic Debt Securities, temporarily allaying concerns over default risk.
The extensions to 29 September 2023 from 31 July 2023 come following further delays in the Company’s effort to refinance both debt facilities via a term loan, which management now targets to conclude by end-September 2023. Since our last update, progress has been slower than expected despite the relevant parties’ resolve to successfully complete the restructuring exercise.
The Junior Sukuk’s C2/Negative rating continues to reflect a high likelihood of default should the refinancing not materialise, given LEKAS’s tight liquidity position and lumpy debt repayment. Completion of the exercise without significant credit or economic loss is also critical to averting a payment default on the Junior Sukuk. We will continue to monitor the transaction and make necessary updates as more details are made available.
LEKAS holds the concession for the 44 km Kajang-Seremban Highway.
Analytical contacts
Seri Nuralya Munawir
(603) 3385 2484
nuralya@ram.com.my
Davinder Kaur Gill
(603) 3385 2525
davinder@ram.com.my
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