Moody’s affirms Medco Energi

Moody's Investors Service said it affirmed the B2 corporate family rating of Medco Energi Internasional Tbk.

Moody's also affirmed the B2 ratings on the backed senior unsecured bonds issued by Medco Strait Services Pte. Ltd. and Medco Platinum Road Pte. Ltd.

The outlook remains positive.

On Jan. 30, Medco announced a cash offer to acquire Ophir Energy plc for £390.6 million.

The acquisition, which remains subject to regulatory and shareholder approvals, will be funded with a mix of fresh borrowings and Medco's internal cash.

“The B2 ratings and positive outlook reflect our expectations that Medco's credit metrics will continue to improve over the next few quarters, despite the increase in borrowings to fund the proposed acquisition,” Rachel Chua, Moody's assistant vice president and analyst, said in a news release.

“Such improvement in credit metrics will be supported by Medco's sale of its non-core assets in line with its deleveraging plan and also takes into account the strong operating cash flow generation from Ophir's portfolio once the transaction is complete.”

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