MARC has withdrawn its MARC-1ID/AA-ID ratings on Bayu Padu Sdn Bhd’s (Bayu Padu) RM100 million Murabahah Commercial Paper/Medium Term Notes (Murabahah CP/MTN) programme with immediate effect following the full redemption of the outstanding RM90 million Murabahah CPs and the expiration of the seven-year facility programme on November 28, 2012. MARC’s analytical coverage on Bayu Padu is now limited to its RM500 million Istisna’ Serial Bonds currently rated AA-ID with a stable outlook.

Bayu Padu is a wholly-owned funding vehicle of SapuraKencana Petroleum Berhad (SapuraKencana), a leading provider of integrated oilfield services to the oil and gas industry. SapuraKencana recently proposed to acquire a fleet of tender rigs from Norway-based Seadrill Limited (Seadrill). MARC understands that the acquisition will most likely be largely funded with debt, which will increase the group’s gearing level. Should earnings accretion from the acquisition be slower than expected, SapuraKencana’s debt servicing ability, including that of Bayu Padu’s, could come under pressure. Nonetheless, MARC is aware that the proposed acquisition is still preliminary, with funding options yet to be finalised, and will continue to monitor developments of the proposed corporate exercise and assess the impact on the ratings accordingly.

Contacts:
Se Tho Mun Yi, +603-2082 2263/ munyi@marc.com.my;
Sharidan Salleh, +603-2082 2254/ sharidan@marc.com.my.