Marble’s Corp Governance Is Weak on Lack of Transparency: Lucror

Marble II’s corporate governance is weak due to lack of transparency at a holding company level, and also because ownership by financial sponsors is seen putting shareholders’ interests over those of creditors, according to Trung Nguyen, lead analyst at Lucror Analytics.

Marble II is the acquisition vehicle of Blackstone (86%) and GIC (14%) to acquire a 60% stake in Indian IT company Mphasis.

Its credit profile is weighed down by the structure, with material cash leakage in the dividend up-streaming from Mphasis, and also because it’s controlled by a financial sponsor.

The negatives are mitigated, to a certain extent, by GIC’s reputation and Blackstone’s track record in a previous high-yield transaction.

NOTE: Marble II may price USD 5NC2 bonds today; IPT is in 5.75% area.

Proceeds will be used to repay $267m loan, prefund six months of interest and pay dividend recap to Marble II’s shareholders: Lucror.

Earlier story: Marble bond covenants show weak cash leakage protection: Moody’s.

Bloomberg News
June 13, 2017, 07:13:52 GMT

Reporting by Divya Patil; Editing by Neha D'silva and Beth Thomas