MARC has lowered its rating on Malaysian International Tuna Port Sdn Bhd’s (MITP) RM240.0 million Bai’ Bithaman Ajil Islamic Securities (BAIS) to DID from BB+ID and removed the rating from MARCWatch Negative, where it was first placed on February 19, 2009. The downgrade follows MITP’s failure to make a November 17 profit payment on the BAIS.

A 60:40 joint venture company between Bindforce Sdn Bhd and Lembaga Kemajuan Ikan Malaysia (Fisheries Development Authority of Malaysia or LKIM), MITP is the holder of a 32-year concession to manage, operate and develop a tuna port at Batu Maung, Pulau Pinang. The port was to be developed into a fully integrated fisheries port by the year 2009 using the proceeds of the BAIS to finance the third phase of construction works at the port. The construction of MITP’s fisheries port was halted as a result of a stop-work order issued by Department of Environment Malaysia in September 2007. With construction stalling and MITP’s sinking fund account (SFA) depleted as a result of draws made on the SFA to service earlier BAIS profit payments, MARC had earlier highlighted MITP’s increased vulnerability to missed payment on November 17 in the absence of full and timely financial support from the government.

Following the downgrade, MARC will discontinue rating surveillance on MITP’s BAIS.

Contacts:
Sandeep Bhattacharya 03-2090 2247/sandeep@marc.com.my;
Khairul Emran Mahmud 03-2090 2278/emran@marc.com.my;