Indorayon rating withdrawn

Indorayon rating withdrawn

JAKARTA (AFX-ASIA): Moody's Investors Service said it affirmed and then withdrew the 'Ca' rating on PT Inti Indorayon's US$150 million senior notes and $110 million guaranteed notes.

It said the company's operations have been seriously affected by the closure of its pulp mill at Porsea, North Sumatra. Inti Indorayon has since 1999 suspended all debt repayment.

"The rating reflects the low expected recovery rate and the apparent uncertainty in resolving creditors' claims under Indonesian law," it said.

At the same time, Moody's withdrew the rating following the notes' maturity in 2000 and 2001 respectively.

"Although the notes remain unpaid, Moody's regards it as unlikely that a debt restructuring agreement will be reached in the near future, given the lack of progress on the resumption of the mill's production.

"In Moody's opinion, it remains uncertain as to when the mill will be re-opened in view of the economic and social conditions in Indonesia."