Kuwait's Kipco repays $350 million debt

On The Wires: Kuwait's largest privately-owned investment firm Kipco, has repaid a five year bond today worth $350 million.

Kuwait Projects, the country's largest privately-owned investment firm known as Kipco, repaid its debut $350 million (Dh1,28 billion) five-year bond which expired today.

The debt was issued April 12, 2006 under Kipco's $2bn euro medium-term note programme, the Safat, Kuwait-based firm said in an e-mailed statement today. Moody's Investors Service earlier said it was reviewing the company's Baa2 ratings for possible downgrade.

Kipco's cash coverage has weakened from 3.7 times to 2.6 times, and net debt of $866m was "higher than previously expected," Moody's said in the statement, citing the company's 2010 results published March 30.

"We've repaid the five-year bond on time as part of the EMTN programme and it is not linked to any ongoing or previous discussions with any rating agency," Robert Hipkins, Kipco's spokesman, said in a telephone interview. "Our funding policy is extremely long-term, and is not affected by the opinions of rating agencies."

Bond sales in the six-member Gulf Cooperation Council fell to $5.8bn in the first quarter from $13.3bn in the previous quarter, as political turmoil in the Middle East shook investor confidence, according to data compiled by Bloomberg. Kipco sold $500m of 10-year bonds in July.

Bloomberg News