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Bond Market News
GLP Downgraded to BB by Fitch
October 17, 2023
GLP Pte’s (GLP) and its senior unsecured ratings were downgraded by two notches to BB from BBB-. The downgrade reflects the company’s weakening credit profile and delay in deleveraging via its asset monetization process. GLP is trying to sell its interest in the Chinese Logistic asset portfolio and hoping to raise $10bn via asset monetization. However this process is taking longer than expected, according to Fitch. This has put pressure on the financial profile of the company leading to deterioration in interest coverage and debt structure. GLP’s interest coverage ratio dropped to 1.3x in 1H 2023, from 1.5x in 2022 and is expected to decline further in the near-term, according to Fitch. As of end-June 2023, GLP had short term borrowings of $6.5bn against available cash of $2.5bn. The company expects to repay $2bn in bonds due in 2024 using cash on hand and proceeds from asset monetization.
GLP’s dollar bonds traded lower with its 3.875% 2025s dropping to 65.1 cents on the dollar.
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