PT Kawasan Industri Jababeka Tbk. (Jababeka) has proposed an exchange offer to restructure its guaranteed US$300 million notes falling due in October 2023. We view the debt exchange offer as distressed because the participating bondholders will receive less than the originally promised amount without adequate offsetting compensation from the Indonesian developer. On Nov. 8, 2022, S&P Global Ratings lowered its long-term issuer credit rating on Jababeka and issue rating on the company's guaranteed senior unsecured notes to 'CC' from 'CCC'. The negative outlook reflects our expectation that we will lower the issuer credit rating on Jababeka to 'SD' (selective default) and issue rating on its guaranteed senior unsecured notes to 'D' (default) when the company completes the exchange offer. The
