Add to balance / Manage account | User: | Log out |
Prospect News home > News index > List of issuers A > Headlines for American Water Works Co., Inc. > News item |
Moody's cuts American Water, rates notes Baa2
Moody's Investors Service said it downgraded American Water Capital Corp.'s senior unsecured issuer rating to Baa2 from Baa1 and confirmed its P-2 short-term rating. The agency also assigned a Baa2 senior unsecured rating to the company's planned $1.5 billion note offering and a Baa2 senior unsecured issuer rating to parent company American Water Works Co., Inc.
This concludes the review for possible downgrade begun on Aug. 28, and the outlook for both companies is stable.
The agency's review of American Water Capital's ratings was prompted by American Water Works' planned recapitalization of the company in advance of the divestment, via initial public offering, from its current parent, RWE AG. American Water Capital is expected to issue $1.5 billion of senior unsecured notes and $500 million of "equity unites" in order to substantially repay $2 billion of intercompany debt owed to RWE before the transaction occurs in late 2007.
The one-notch downgrade of American Water Capital's rating and the assignment of a Baa2 issuer rating to American Water Works reflects the loss of implied support from RWE following the IPO, historically weak consolidated credit metrics and the increase in financial and operating risk going forward as a publicly traded standalone company, Moody's said.
© 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.