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S&P puts CLP Holdings, unit on watch
Standard & Poor's said it placed its ratings on CLP Holdings Ltd. and its subsidiary CLP Power Hong Kong Ltd. on CreditWatch with negative implications.
The CreditWatch placement followed CLP Holdings' recent announcement that it was in advanced negotiations with SPI Australia Group to acquire the latter's merchant energy division. SPI is a wholly owned subsidiary of Singapore Power Ltd.
S&P said the rating action reflects concerns that the acquisition, estimated at A$2 billion, will result in materially weaker creditor protection levels. The CreditWatch placement also reflects S&P's concerns that CLP Holdings' business profile is gradually moving away from that reflected by the A+ credit rating on the company as management pursues higher risk generation and retail utility investments outside Hong Kong.
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