S&P cuts Eesti Energia

Standard & Poor's said it lowered the long-term corporate credit rating on Eesti Energia AS to BBB+ from A-.

The outlook is stable.

The downgrade reflects an expectation that Eesti Energia's financial risk profile will gradually weaken over the medium term to levels not commensurate with the previous rating, S&P said. This will mainly be caused by the high investments required to modernize the company's asset base, the agency said.

The downgrade also reflects Eesti Energia's weakened business risk profile as a result of the disposal of its low-risk electricity transmission operations, S&P said, and because of increasing environmental pressure on European utilities.

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