Rating on Medco unaffected by change in controlling shareholders: S&P

Standard & Poor's Ratings Services said Tuesday the change in the indirect controlling shareholders of Indonesian oil and gas company, PT Medco Energi Internasional Tbk. (Medco; B+/Stable/--), should not by itself have an impact on the rating on Medco.

New Links Energy Resources Ltd. is the holding company that owns 85.5 percent of Medco. Encore Ltd. now fully owns New Links, after recently increasing its stake from 40.1 percent previously. The Panigoro family, the founding shareholder of Medco Energi, fully owns Encore Ltd. Before the change in shareholders, Thailand's PTT Exploration & Production Public Co. Ltd. (PTTEP; BBB+/Stable/--) owned a 40 percent stake in New Links, while the remaining 19.9 percent stake in New Links was held by Credit Suisse First Boston (Hong Kong) Ltd. (CSFB), which acquired its stake through a debt-equity swap in 1999.

With the change in shareholders, Encore presently holds 85.5 percent of Medco, after its acquisition of New Links stakes held by PTTEP and CSFB for a total consideration of US$343.5 million. Standard & Poor's believes that the change in shareholders of Medco is not likely to result in a significant change to the company's operations, growth strategies and capital structure, and hence should not affect its credit quality. (*)