Fitch cuts Ranhill

Fitch Ratings said it downgraded Ranhill Bhd.'s long-term foreign-currency issuer default rating to B- from B and placed it on Rating Watch negative.

The agency said it revised the recovery rating on the $220 million notes due October 2011 issued by subsidiary Ranhill (L) Ltd. and guaranteed by Ranhill to RR4 from RR5.

With the downgrade of the issuer default rating and the revision of the recovery rating, the long-term rating on the notes remains at B-, Fitch said, but this rating also has been placed on Rating Watch negative.

The downgrade reflects Ranhill's increasing liquidity risk due to the impending maturity of the notes, Fitch said.

The downgrade also reflects Ranhill's weak cash inflows and the high likelihood that a refinancing package will absorb much of the dividends Ranhill receives from its subsidiaries, weakening its long-term liquidity profile, the agency added.

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