RAM Ratings has reaffirmed the respective AAA, AA2, A1, A2 and AAA ratings of Menara ABS Bhd’s Tranche A1, Tranche A2, Tranche A3, Tranche A4 (Tranche A Sukuk) and Tranche B Sukuk Ijarah.
According to RAM in a statement on its website, the negative outlook on the ratings of the Tranche A Sukuk has been reverted to stable while the stable rating outlook on the Tranche B Sukuk has been maintained.
It also stated that Menara ABS is a trust-owned, special-purpose vehicle incorporated solely for this sale-and-leaseback transaction involving 4 properties – Menara TM, Menara Celcom, TM Taman Desa and TM Cyberjaya which had been previously owned by Telekom Malaysia (TM or TM Group).
In a statement on its website, the negative outlook on the ratings of the Tranche A Sukuk has been reverted to stable while the stable rating outlook on the Tranche B Sukuk has been maintained.
Apart from that, profit payments on the Tranche A Sukuk are covered by lease payments from TM while the principal redemption will be met via proceeds from either refinancing, repurchase by TM or disposal of the properties in the open market.
Meanwhile, the principal redemption and profit payments on the Tranche B Sukuk are met by the lease payments from TM, whose credit profile therefore underpins this tranche’s rating and outlook.
Tranche A Sukuk’s ratings, from negative to stable, premised on RAM’s expectations that the properties’ performance will eventually converge to a more sustainable level, in line with its assumption for the medium term.