Moody's: Berau, Bumi unchanged

Moody's Investors Service said PT Berau Coal's B2 rating and stable outlook and PT Bumi Resources Tbk.'s Ba3 rating and negative are unchanged following the announcement that recently formed Vallar plc plans to buy a 25% stake in Bumi Resources and a 75% stake in PT Berau Coal Energy, the immediate parent of Berau Coal.

Under the terms of the $450 million notes issued by Berau Capital Resources Pte. Ltd, a change of control event will occur once Vallar owns the Berau Coal Energy shares, and the issuer will need to make a tender offer for the bonds at 101% of par. The agency said the cost burden in terms of fees and purchases of tendered bonds is likely to be manageable.

Moody's said the broad wording of the change-of-control language in Bumi Resources's bond documents seems to preclude a change of control event from arising on this occasion, and the agency therefore expects no impact on the company.

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