MARC has received confirmation from the Trustee that the BaIDSholders for KLSSB’s Tranche 1 BaIDS of RM120 million has in an Extraordinary BaIDSholders Meeting (EBM) held on 3 April 2003, approved KLSSB’s proposal to defer the repayment of RM91 million of the face value of the said tranche, which is due on 4 April 2003 to a date falling six months thereafter with an option given to KLSSB to further defer such repayment to a date falling twelve months after the original maturity date on 4 April 2003. The Trustee has also confirmed that KLSSB has made partial repayment for the remaining RM29 million of Tranche 1’s BaIDS (on parri passu basis to all BaIDSholders) on 4 April 2003. At the same EBM, the BaIDSholders have also approved, amongst others, the introduction of a strategic investor in KLSSB; and indulgence for non-compliance of the debt-to-equity ratio until Tranche 1 BaIDS has been redeemed. These proposals are subject to the consent of the Securities Commission.

As a result of the above, MARC wishes to advise that whilst the rating for Tranche 1 BaIDS remains unchanged at A-ID and continues to be placed under MARCWatch, its outlook has been revised to developing from negative. MARC will continue to monitor events as they unfold to determine their effect on Tranche 1’s rating.