Moody's cuts Energy, Oncor; Energy notes Caa3

Moody's Investors Service said it downgraded the corporate family rating of Energy Future Holdings Corp. to Caa3 from Caa2.

The agency also affirmed the company's Caa3 probability of default rating and SGL-4 speculative grade liquidity rating. The outlook remains negative.

In addition, Moody's said it downgraded the senior secured rating of Energy Future's majority owned subsidiary Oncor Electric Delivery Co. to Baa2 from Baa1. Oncor's rating outlook remains negative.

Additionally, Moody's said it assigned a Caa3 rating to Energy Future Intermediate Holding Co.'s new $250 million senior secured notes due 2017 and $500 million senior secured second-lien notes due 2022.

The ratings for Energy Future, its subsidiaries and individual debt instruments are derived from the Caa3 corporate family rating, with the exception of Oncor due to its ring fence type provisions.

Moody's said the downgrade of the corporate family rating reflects the company's financial distress and limited financial flexibility.

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