S&P says Qatar developer Ezdan faces restructuring, default risk

S&P says Qatar developer Ezdan faces restructuring, default risk

Ratings agency expects Ezdan's operating performance to "improve slightly" in 2021-2022, but not enough to materially reduce the very high leverage

Ezdan Holding Group faces the risk of debt restructuring or default as the Qatari real estate developer is yet to obtain credit-lines to meet upcoming maturities, according to S&P Global Ratings.

“Despite discussing payment option plans, the company is still in the negotiation stage of securing a committed credit line to address its significant upcoming debt maturities and amortization schedule,” according to the ratings agency. S&P cut Ezdan's rating to CCC from B- with negative outlook.

Ezdan's $500 million senior unsecured sukuk matures on May 18. The property developer also has about QR900m ($245m) of secured debt maturing in 2021 and QR2.7bn of sukuk and debt maturing next year, according to S&P.

The ratings agency also said:

The negative outlook reflects “narrowing liquidity and high debt balances, which could lead to a distressed exchange, debt restructuring, or default over the next 3-12 months.”

“Without a committed refinancing plan or an equity contribution from its shareholder, we do not believe that Ezdan has sufficient cash or liquid assets on its balance sheet to repay its debt.”

Expects Ezdan's operating performance to “improve slightly” in 2021-2022, but not