Fitch rates NextEra, debt BB+

Fitch Ratings said it assigned a long-term issuer default rating of BB+ to NextEra Energy Operating Partners, LP (NextEra Energy) and affirmed the BB+ issuer default rating for NextEra Energy Partners, LP (NextEra).

The outlook is stable.

Due to strong legal ties, the issuer default ratings of the two entities are the same.

The agency also assigned a BB+/RR4 rating to the proposed $1.1 billion senior unsecured debt issuance at NextEra Energy. This reflects its view that the unsecured debt at NextEra Energy will achieve average recoveries in a default situation, and, hence, the rating on the notes reflects zero notching from the issuer default rating or the RR4 recovery rating.

The proposed senior unsecured notes will be absolutely and unconditionally guaranteed by NextEra. The notes will also have an upstream guarantee from Nextera Energy US Partners Holdings, LLC (US Holdings), which is a subsidiary of NextEra Energy.

NextEra Energy expects to use the net proceeds to repay all the outstanding term loans and revolver borrowings at US Holdings (Nextera Energy Canada Partners Holdings, LLC is a co-borrower on the revolver), which total about $1.06 billion as of June 30.

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