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Wed 29 Jan 2020 02:23 PM

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Moody's raises rating of Dubai Aerospace Enterprise to investment grade

Ratings agency says the rating of the aircraft leasing company had been changed from Baa3 from Ba1

Moody's raises rating of Dubai Aerospace Enterprise to investment grade

Dubai Aerospace Enterprise (DAE) on Wednesday announced that Moody’s Investors Service has upgraded its corporate family rating to investment grade.

The ratings agency said the rating of the aircraft leasing company had been changed from Baa3 from Ba1, and the senior unsecured rating of subsidiary DAE Funding to Baa3 from Ba2. This action concludes the review for upgrade initiated in November, the agency said, adding that the outlook is stable.

Firoz Tarapore, CEO of DAE said: “We have worked assiduously over the last two years to position our franchise to be rated as an investment grade company. We are delighted with this rating upgrade from Moody’s.

"DAE's senior unsecured debt is now rated investment grade by three major US credit rating agencies. This will enable us to further solidify our Top 10 franchise, accelerate our growth ambitions and strengthen our liquidity and capital position."

Moody's said the upgrade reflected the company's improving funding structure and liquidity, lower leverage, and further progress obtaining repayment of a large loan to its shareholder, the Investment Corporation of Dubai, an investing arm of the government of Dubai.

Moody's added that it expects that DAE will manage its debt maturities to avoid concentrations that could increase its refinancing risks.

"Based on the company's strong cash flows, including from operations and trading activities, Moody's expects that DAE will continue to maintain adequate capital strength as it pursues modest fleet growth," the agency added.

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