Moody’s could drop Enersis

Moody's Investors Service said it placed the Baa2 senior unsecured rating of Enersis SA under review for downgrade and affirmed the Baa2 senior unsecured rating of Empresa Nacional de Electricidad SA (Endesa Chile).

The outlook of Endesa Chile is stable.

Moody’s said the actions were prompted by the expected credit implications on Enersis' and Endesa Chile's ratings arising from the group's proposed reorganization announced on Nov. 5. If the proposed reorganization is approved the holding company Enersis Americas, the successor company of Enersis, will hold the group's direct and indirect equity interests in all the non-Chilean electric distribution, transmission and power generation subsidiaries.

"The review for downgrade of Enersis' Baa2 senior unsecured rating is largely driven by Moody's view of the weaker credit quality of the cash flows that will be available to Enersis Americas to service the debt assumed from Enersis when compared to Enersis' current consolidated cash flows," Moody's vice president, senior analyst Natividad Martel said in a news release.

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