S&P gives Acu Petroleo notes BB

S&P said it gave preliminary BB issue and 2 recovery ratings to the $650 million of senior secured amortizing notes due 2035 to be guaranteed by Acu Petroleo SA (the project). Acu Petroleo Luxembourg Sarl will sell the notes.

“The preliminary ratings incorporate the project's strong competitive position, considering that it connects one of the most prolific oil areas in the world. On the other hand, we expect significant volatility in its cash flows in a potential market downside scenario, considering that in the long term, the project's contracted position is low,” S&P said in a press release.

The agency said it forecasts a minimum and average annual debt-service coverage ratio of 1.25x in the project’s first stage and in the second stage minimum and average metrics slightly higher, at 1.5x and 3.5x, respectively.

The outlook is stable.

S&P rates Hong Kong airport notes AA+

S&P said it assigned its AA+ long-term issue rating to a planned multiple tranche sale of U.S. dollar-denominated senior unsecured notes by Airport Authority Hong Kong.

The issuance, which will include a green note tranche all to be issued under Rule 144A and Regulation S, can be marketed to investors in Asia, Europe and the U.S. AAHK may redeem the notes in full or in part at par three months before the stated maturity date for the notes with a tenor of 10 years or below, and six months prior for the notes with a tenor above 10 years.

“We rate the senior unsecured notes the same as our issuer rating on AAHK because the authority's capital structure has virtually no structural or contractual subordination risk. As of Sept. 30, 2021, AAHK had total debt of HK$53.4 billion issued at the parent level, including perpetual capital securities. The authority had no secured or priority debt. It therefore does not breach the issue rating notching-down threshold of 50% for the ratio of priority debt to total debt,” S&P said in a press release.

AAHK plans to use the proceeds to fund its capital expenditures, including for its three-runway system project, and for general corporate purposes. Proceeds from the green notes will be used to finance or re-finance selective green projects.

The outlook is stable.

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