MARC has downgraded the rating on Jana Niaga Sdn Bhd’s (JNSB) RM100.0 million Murabahah Underwritten Notes Issuance Facility (MUNIF) from MARC-4ID to DID. The rating of “DID” reflects JNSB’s failure to make scheduled payment on the RM100.0 million MUNIF due on November 7, 2007 following verbal confirmation from the sole note holder and Facility Agent, Abrar Discounts Berhad (Abrar), under the management of Prokhas Sdn Bhd (Prokhas).

JNSB is the holder of a 20-year concession to build and operate student hostels, staff accommodation, a child care centre, a student community centre and a student centre for the University Industri Selangor (UNISEL). As consideration for the construction and maintenance of the buildings, UNISEL had guaranteed a minimum monthly rental payment and monthly maintenance fee amounting to RM943,000 and RM482,000 respectively. JNSB’s payment default was precipitated by failure on the part of UNISEL to meet its payment obligations to JNSB in a timely manner.

Further to the rating downgrade, MARC has withdrawn its rating and no longer has any rating obligation on the MUNIF issue.