Credit Suisse handles Gajah Tunggal bonds

PT Gajah Tunggal Tbk appointed Credit Suisse to convert bonds.
Due to financial constraint for bond coupon payment, Gajah Tunggal plans to change the securities into new bonds worth US$441.5 million with extended due date by 2014.
Director of Gajah Tunggal Catharina Widjaja said the bond conversion is the restructuring pattern by extending the bond maturity.
"The company does not spend any fund," she said in short message service this week.
Two rating companies, Standard & Poor's and Moody's Investor Services degraded Gajah Tunggal rating.
Moody's degraded the bond rating as from Caa1 into Ca. At the same time, Moody's set Gajah Tunggal rating of Caa1 level with negative prospect.
Analyst of Moody's Wonnie Chu said the downgrading rating is due to the bond conversion scheme of Gajah Tunggal.
Then, S&P also lowered down PT Gajah Tunggal Tbk rating into CC as from CCC+.
S&P considered the company has financial constraint to pay US$ 21.5 million bond coupon matured on 21 July 2009.
"S&P Ratings moved down the long term Gajah Tunggal corporate credit into CC as from CCC+ with negative prospect," said analyst of S&P Wee Khim Loy yesterday.