S&P rates Eletrobras notes BB-

S&P said it assigned its BB- issue-level rating to Eletrobras-Centrais Eletricas Brasileiras SA's proposed senior unsecured notes of up to $1.75 billion due 2025 and 2030.

The new notes will be issued in connection with an exchange and cash tenders for the company's $1.75 billion, 5¾% notes due 2021. “This transaction is in line with our expectations of the company's debt refinancing, and it will further improve Eletrobras' medium-term financial flexibility,” S&P said in a press release.

The terms of the new notes are very similar to those for the existing ones, including the absence of financial covenants. “The rating on the proposed notes is at the same level as our issuer credit rating on the company, given its strong relationship with the government and that government-related entities aren't subject to reorganization according to Brazil's law,” the agency said.

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