S&P upgrades Isagen

S&P said it raised the long-term corporate credit rating on Isagen, SA ESP to BBB from BBB-.

The outlook is negative.

The upgrade reflects the similar action on its controlling parent, Brookfield Renewable Partners LP, S&P said, and an understanding that Isagen remains a moderately strategic subsidiary of its ultimate parent.

Considering that Isagen, a Colombia-based power generation company, represents 30% of the group's total installed capacity, the agency said it believes that it would likely receive support from Brookfield Renewable should it encounter financial difficulties.

S&P said the final rating raise on Isagen reflects a view of the group's overall improving creditworthiness and its ability to support the subsidiary.

The outlook is negative because the strategic importance of Isagen to the parent is not strong enough to support the subsidiary under all circumstances, including a stress scenario associated with a default of Colombia, the agency said.

Isagen's creditworthiness is limited to that of the sovereign's creditworthiness, S&P said.

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