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Dubai developer put on credit watch list

Standard & Poor's Ratings Services is growing increasingly concerned about its long-term 'BBB-' corporate credit rating for the ETA Group and has placed the Dubai-based conglomerate on CreditWatch.

The ETA Group, which through its subsidiaries, has interests in real estate, contracting and shipping, has a 'BBB-' debt rating for its $300m senior unsecured bank loan which is due in 2012.

According to S&P the group has been put on CreditWatch because of concerns that the global economic slowdown is now adversely affecting ETA's main markets, which may lead to a drop in trading performance and a further deterioration of key credit ratios. "These actions are due to concerns over increasing financial leverage, the likely adverse effect of the continuing global economic slowdown on ETA's cyclical activities, and low levels of headroom under financial covenants," said Standard & Poor's credit analyst Stuart Clements.

S&P aims to resolve the CreditWatch within 90 days.

Source: MEED