S&P assigns Sawit Sumbermas CCC+

S&P said it assigned PT Sawit Sumbermas Sarana Tbk. a CCC+ issuer rating with a negative outlook. The company is a unit of PT Citra Borneo Indah Tbk.

“The issuer credit rating on SSMS reflects CBI's weak credit profile, unsustainably high leverage, loss-making operations, and limited liquidity. We believe CBI's limited debt-servicing capacity will gradually erode SSMS' own credit quality and liquidity,” S&P said in a press release.

“The negative outlook on SSMS over the next 12-18 months reflects our view of increasing risk at CBI, driven by the sustained and sizable financial support that CBI requires from SSMS. It also reflects our view that the absence of transparency and disclosure at CBI will limit visibility over its weakening financial profile and could lead to higher cash leakage from SSMS to CBI than we anticipate,” S&P said.

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