Fitch maintains Chugach watch

Fitch Ratings said it maintained Chugach Electric Association, AK's implied senior unsecured and secured obligation ratings on rating watch evolving.

The agency said the rating watch is driven by Chugach's planned purchase, subject to negotiations and regulatory approval, of Anchorage Municipal Light and Power's (A+/stable) power system and assets.

The sales price was announced at $1 billion and includes about $712 million to defease ML&P's outstanding debt and purchase ML&P's equity in the system. This amount is expected to be largely debt financed.

Fitch said it views the transaction, if completed, as likely to result in a material change in the utility's operating, financial and debt profiles, which could lead to either positive or negative action.

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