S&P: Electricidad de Caracas on developing watch

Standard & Poor's said it revised the CreditWatch implications for its B foreign currency corporate credit rating on C.A. La Electricidad de Caracas to developing from negative.

In addition, the agency said it revised the CreditWatch implications for its B senior unsecured debt rating on Electricidad de Caracas Finance BV's notes due 2014 to developing from negative.

The revised CreditWatch follows the preliminary agreement between The AES Corp. (BB-/stable) and the Bolivarian Republic of Venezuela (BB-/stable/B) for the purchase of AES' 82.14% stake in EDC for $740 million, the agency noted.

The government will acquire the company through Petróleos de Venezuela SA (B+/Watch positive), S&P said, adding that this agreement removes some of the downside risk in the credit, in that the Venezuelan government would be providing meaningful compensation to AES for the nationalization of Electricidad de Caracas.

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