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REG - Kuwait ProjectCo SPC - KIPCO confirms its strong liquidity position




 



RNS Number : 4702K
Kuwait Projects Co SPC Limited
22 April 2020
 

Immediate Release

 

KIPCO confirms its strong liquidity position and intention to redeem July 2020 debt maturity with existing resources

 

 'KIPCO's liquidity remains very strong' says company's Vice Chairman

 

Kuwait City, 22 April 2020: KIPCO - the Kuwait Projects Company (Holding) - has confirmed that it is on track to retire the US$ 500 million bond maturing in July 2020 out of existing resources, demonstrating its strong liquidity position. There will be no other KIPCO bond maturing for almost three years.

 

Noting the recent decision from S&P Global Ratings to downgrade KIPCO's senior unsecured bonds, the company said its credit profile continues to be solid. The S&P rating was last affirmed in early March 2020. However, following the global equity market sell-off driven by COVID-19, quoted market prices of KIPCO's key listed assets have declined, leading to an increase in the Loan to Value (LTV) ratio above the rating agency threshold. In particular, Burgan Bank's share price has declined by around 29% year to date (YTD), in line with other Kuwaiti banks (26% YTD). S&P also reduced its views on the valuation of two unlisted or thinly traded assets.

 

This global sell-off is an unprecedented event with markets driven by fear and uncertainty around COVID-19 and its short to medium term impact. KIPCO believes that current prices do not represent the intrinsic value of its portfolio companies. KIPCO owns fundamentally strong market leaders in their respective sectors and, in particular, Burgan Bank, Gulf Insurance Group and KAMCO Invest have reported very good results for 2019.

 

Furthermore, OSN's streaming platform was relaunched earlier this month, with thousands of customers joining the platform each week. Customers are enjoying the new content in the safety of their homes with fresh movies, series, family and kids content from Disney+, HBO, Nickelodeon and other major Hollywood studios. This comes as a result of OSN resetting its content rights with the studios along with securing the exclusive distribution rights for the entire MENA region across linear and digital platforms.

 

KIPCO's Vice Chairman (Executive), Mr Faisal Al Ayyar said:

 

"One of KIPCO's strengths is its proactive management of liabilities, along with its strong liquidity position. In October 2019, the company refinanced its upcoming 2020 bond maturity in advance, thereby extending the average debt maturity. Once the July 2020 bond is repaid, there will be no debt maturing until March 2023. This structure is very supportive of the long-term nature of our investment strategy and provides us with runway to overcome any short to medium-term challenges such as COVID-19."

 

-  Ends -

 

Notes to Editors:

The KIPCO Group is one of the biggest holding companies in the Middle East and North Africa, with consolidated assets of US$ 32 billion as at 30 September 2019. The Group has significant ownership interests in over 60 companies operating across 24 countries. The group's main business sectors are financial services, media, real estate, manufacturing and education.

 

The conversion rate used is US$1 to KD 0.30405

 

Further information:                            

Eman Al Awadhi               Group Communications Director

Corporate Communications Department

T: +965 2294 3416

                                       M:+965 6033 6399


This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.
 
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