S&P rates Abengoa notes BBB-

Standard & Poor's said it assigned a BBB- long-term issue rating to Abengoa Transmision Sur's senior secured notes due April 2043.

The outlook is stable.

S&P also said it assigned a BBB- long-term rating to the company's $432 million 6 7/8% 29-year notes following a receipt and satisfactory review of all transaction documentations, including legal opinions.

The ratings reflect the company's favorable concession agreement that stipulates the project's annual revenues as fixed and dollar-denominated payments based on its availability, eliminating price and demand risk, the agency said.

The ratings also consider the strategic importance of the asset for the Peruvian transmission system, S&P said.

Within the last seven years, electricity demand in Peru has grown at a compounded annual rate of about 7%, boosted by prosperous economic conditions in the country, the agency said.

Some rating weaknesses include the company's high debt level typical for this type of asset class and Peru's lack of significant track record of the concession program, S&P said.

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