Moody’s ups Eletropaulo to Ba2/Aa3.br

Moody's America Latina said it upgraded Eletropaulo (Metropolitana de Eletricidade de Sao Paulo SA)’s corporate family ratings and senior unsecured ratings to Ba2 from Ba3 on the global scale and to Aa3.br from A3.br on Brazil’s national scale.

The outlook is stable.

Moody’s said the upgrade reflects primarily its expectation of improved performance that will further support the company’s already adequate credit metrics in terms of liquidity and leverage.

The action also considers the March settlement that the company reached with Centrais Eletricas Brasileiras SA – Eletrobras (Ba3 stable) on their long-standing judicial dispute. As part of that agreement, the company will pay Eletrobras R$1.5 billion over a period of about four years.

Finally, Moody’s said the action notes the control acquisition of Eletropaulo by Enel Americas SA (Baa3 negative) through the purchase of a 73.38% stake in the company that will bring a capital injection from Enel Americas of R$1.5 billion further strengthening the capital structure of the company.

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