Moody’s cuts Homer City bonds to Caa2

Moody's Investors Service said it downgraded Homer City Generation LP's senior secured bonds to Caa2 from B3.

The outlook was revised to negative from stable.

Moody’s said the downgrade reflects General Electric Capital Corp.’s (GE) recently announced $800 million after-tax write down of its investment in Homer City, GE’s plan to exit over time its indirect interest in Homer City, and the termination of the $75 million uncommitted working capital line between GE and Homer City in late 2015.

Given these actions, the agency incorporates the assumption that further sponsor support is unlikely except for approximately $18 million necessary to complete the project's SO2 scrubbers in 2016.

Moody’s also sees these actions as highlighting the project's standalone credit deterioration and substantially diminished long-term value.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.