S&P: Energen on watch, Alagasco on positive watch

Standard & Poor's said it placed the BBB- corporate credit and senior unsecured debt ratings on Energen Corp. on CreditWatch with negative implications.

The agency also said it placed the BBB- corporate credit and senior unsecured debt ratings on subsidiary Alabama Gas Co. (Alagasco) on CreditWatch with positive implications.

The negative watch follows news that Energen has reached an agreement to sell Alagasco, its regulated gas distribution utility.

S&P said it views the sale as reducing Energen's cash flow diversity and stability.

The proceeds will be used from the sale to greatly enhance Energen's capacity to fund development of its oil and gas producing properties and repay debt, the agency said.

The positive watch on Alagasco reflects the potential upgrade in ratings for the company pending acquisition by a higher-rated entity, S&P said.

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