S&P lowers FirstEnergy, notes

S&P said it lowered the corporate credit rating on FirstEnergy Solutions Corp. to B from BB- and placed the rating on CreditWatch with negative implications.

S&P also downgraded its secured and unsecured note ratings on the company to BB- from BB+ and B from BB-, respectively, and placed them on CreditWatch with negative implications. The recovery rating of 3 on the unsecured debt is unchanged, reflecting an expectation of meaningful (50%-70%; lower end of the range) recovery in the event of default.

S&P said the downgrade and CreditWatch placement stem from the recent announcement of the potential sale (or transfer) of certain assets of Allegheny Energy Supply LLC and the recent discussion of a potential medium term restructuring.

The agency had previously consolidated the financial information of FirstEnergy Solutions and Allegheny Energy Supply (together the Competitive Energy Supply (CES) business) because it considered the latter to be a core affiliate.

Moody’s may lower Brocade Communications

Moody's Investors Service said it placed Brocade Communications Systems, Inc.'s ratings under review for downgrade, including its Ba1 corporate family rating and Ba1 senior unsecured rating.

The review placement follows news that Broadcom Ltd. plans to acquire Brocade for $12.75 per share or about $5.5 billion, Moody’s said.

The review was driven by the potential that a portion of existing Brocade debt could remain outstanding post-closing, the agency said, along with uncertainty about the debt's ranking in the new Broadcom capital structure.

Broadcom has not disclosed specifics regarding how the transaction will be financed or the capital structure post-closing, Moody’s said.

If Brocade's debt is put back to the company or otherwise repaid in full in connection with the closing, all of Brocade's ratings will be withdrawn, the agency said.

S&P revises SNC-Lavalin to negative

S&P said it revised its outlook on SNC-Lavalin Innisfree McGill Finance Inc.'s senior secured debt to negative from stable and affirmed its A- issue-level rating on the debt.

SNC-Lavalin Innisfree McGill Finance is the issuer of senior secured notes and the borrower of construction bank facility. It on-lent the debt proceeds to McGill Healthcare Infrastructure Group, G.P. SNC-Lavalin Innisfree McGill has paid the construction facility with the receipt of substantial completion payment from McGill University Health Centre (MUHC).

S&P said the outlook revision reflects the possibility that the project's strained relationship with the MUHC would hinder the resolution of a number of disputed issues.

"These issues, if not resolved favorably for the project, could result in increased risk to the project, which could lead to a downgrade," S&P credit analyst Yousaf Siddique said in a news release.

S&P changes EPR Properties to positive

S&P said it revised its outlook on EPR Properties to positive from stable and affirmed the BB+ corporate credit rating.

At the same time, the agency affirmed the BBB- issue-level rating on EPR's senior unsecured notes and the B+ issue-level rating on its preferred shares.

S&P said the outlook revision follows EPR's recent announcement that it will fund its roughly $700 million investment with $647 million of its common shares and $53 million of cash.

"The positive outlook reflects our view that EPR's leverage and coverage metrics will strengthen as a result of the largely equity-financed transaction and our expectation that the company will sustain a prudent financial policy with debt to EBITDA around or below 6.0x over the next several quarters," S&P credit analyst Nader Abadi said in a news release.

Fitch revises Renault to positive

Fitch Ratings said it revised the outlook on Renault SA to positive from stable and affirmed its long-term issuer default rating and senior unsecured ratings at BBB-.

The action reflects the agency’s view that the group is firmly on track to meet Fitch's current positive rating guidelines at end-2016.

Fitch believes that sustained profitability and cash generation have been achieved through both favorable and adverse conditions, providing comfort that earning generation has not been driven only by the successful product line and the recovery in new vehicle sales in Europe but also by the streamlined cost structure and synergies created with partners.

Any positive rating action will be dependent on the sustainability of the positive trend in the next 12 to 18 months, the agency added.

Moody’s revises Severn Trent view to stable

Moody's Investors Service said it affirmed the A3/P-2 ratings of Severn Trent Water Ltd. and the A3 ratings of Severn Trent Utilities Finance plc, whose debt is guaranteed by Severn Trent Water.

The agency also affirmed the Baa1/P-2 ratings of Severn Trent plc (Severn Trent).

The outlook on all ratings was changed to stable from negative.

Moody’s said the action reflects its expectation that Severn Trent's consolidated credit metrics will stay in line with the guidance for the current A3/Baa1 ratings during the rest of the current five-year regulatory period 2015-20 (AMP6). Moody's ratio guidance includes net debt to regulatory capital value (RCV) below 68% and adjusted interest cover not materially lower than 1.6 times.

These figures are in line with Moody's published ratio guidance for other U.K. regulated water utility groups such as United Utilities Water Ltd. (A3 stable) and Wessex Water Services Ltd. whose financing subsidiary Wessex Water Services Finance plc is also rated A3 with stable outlook.

Moody’s changes Sparebanken Sor to stable

Moody's Investors Service said it affirmed Sparebanken Sor's A1 long-term local- and foreign-currency deposit and issuer ratings, and changed the outlook to stable from negative.

The bank's Prime-1 short term deposit ratings, baa1 baseline credit assessment and Aa3(cr) counterparty credit assessment were also affirmed.

Moody’s said the outlook change reflects its view that Sparebanken Sor's financial performance will remain resilient over the next 12 to 18 months, maintaining the steady performance it has delivered in the first nine months of 2016 despite the softening of the operating environment in Norway.

DBRS assigns A to 407 notes

DBRS said it assigned a rating of A to the C$350 million series 16-A2 senior notes of 407 International Inc.

The agency also confirmed the pre-existing senior bonds at A as well as the junior bonds at A (low) and subordinated bonds at BBB.

All trends are stable.

The notes have a maturity date of May 4, 2027, and rank pari passu with all other senior obligations of the company. As a result, the A rating and stable trend are consistent with the ratings and trend currently assigned to 407’s senior debts, DBRS said.

Fitch rates AEP Transmission BBB+, debt A-

Fitch Ratings said it assigned a long-term issuer default rating of BBB+ and senior unsecured debt rating of A- to AEP Transmission Co. LLC (AEP Transco).

The outlook is stable.

Fitch said the ratings and outlook reflect AEP Transco's low business risk profile as a Federal Energy Regulatory Commission-regulated electric transmission utility company with modest regulatory lag and earnings volatility.

The ratings also reflect the financial support provided by its ultimate parent American Electric Power Co Inc. (AEP; issuer default rating BBB) to maintain a capital structure with 50% equity during a period of rapid expansion. Fitch expects adjusted debt/EBITDAR and FFO fixed-charge coverage to improve to 4.5 times to 5and 5 times to 6 times, respectively by 2018.

Fitch assigns F2 on Eaton Capital

Fitch Ratings said it affirmed the long-term issuer default ratings on Eaton Corp. plc and indirect subsidiary Eaton Corp. at BBB+.

The agency also said it affirmed the issuer default rating on Eaton Capital Unlimited Co. at BBB+ and assigned a short-term issuer default rating and commercial-paper rating of F2 to the company.

The outlook is stable.

The ratings consider the company's product and geographic diversification, which mitigates cyclicality in its industrial end markets, Fitch said.

The agency said it estimates that Eaton's revenue growth during the two-year period between 2015 and 2016 has weakened slightly.

Sales declines are concentrated in the heavy duty truck, oil and gas, agricultural equipment and industrial markets, Fitch said, and partly offset by growth in commercial aerospace and commercial construction.

There also are signs that lower demand in Eaton's hydraulics business may begin to stabilize, the agency said.

DBRS rates H&R REIT debt BBB

DBRS said it assigned a rating of BBB (high) with a stable trend to the $200 million 2.923% series L senior unsecured debentures due May 6, 2022 issued by H&R Real Estate Investment Trust

The bonds will be direct senior unsecured obligations of H&R and rank equally and rateably with all other present and future unsecured and unsubordinated indebtedness of the Trust.

Net proceeds will be used to repay outstanding debt and for general trust purposes.

Moody’s rates Principal Financial notes Baa1

Moody's Investors Service said it assigned a Baa1 senior debt rating to about $650 million of senior notes to be issued by Principal Financial Group, Inc.’s guaranteed senior unsecured debt at Baa1 under an existing shelf registration with the Securities and Exchange Commission.

The notes will be issued in tranches of $350 million and $300 million due in 10- and 30-years, respectively, the agency said. The debt will be guaranteed by Principal Financial Services, Inc., PFG's intermediate holding company.

The outlook is stable.

The proceeds from two issuances will be used to help redeem up to $800 million of senior debt under separate tender offers, Moody’s said.

The agency said the ratings on the notes are based on a full, unconditional and irrevocable guarantee from Principal Financial Services, the direct owner of Principal Life Insurance Co., which is a major U.S. pension and life insurance provider.

Moody's added that the new issuances, which will refinance senior notes due in 2017 and 2019 and partially repay notes due in 2036, will reduce total debt outstanding somewhat and help to better ladder remaining maturities.

Fitch rates Principal Financial notes A-

Fitch Ratings said it assigned an A- rating to Principal Financial Group, Inc.'s issuances of $350 million 10-year senior unsecured notes and $300 million 30-year senior unsecured notes.

Principal Financial’s long-term issuer default rating also is unaffected by this action.

The notes are guaranteed by Principal Financial Services, Inc., the company’s intermediate holding company.

The proceeds from the new senior unsecured debt issuances will be used to refinance two of the company’s existing debt issuances: $300 million 1.85% notes due November 2017 and $350 million 8.875% notes due May 2019.

The ratings reflect the company's strong capitalization and stable, balanced operating profitability, Fitch said.

The ratings also consider the company’s above-average exposure to commercial real estate through direct mortgages, structured mortgage securities and direct real estate investments, the agency said.

S&P rates UBS Americas A-

S&P said it assigned an A- long-term and A-2 short-term counterparty credit ratings to UBS Americas Holding LLC.

The outlook is stable.

The ratings on UBS Americas were assigned in line with the rating on UBS Group AG, its ultimate parent and top-level non-operating holding company.

The agency said the company would receive support from the UBS group under any foreseeable circumstances.

UBS Americas will play an integral role within its parent group because it is required in order to operate in the United States with its current operating structure, S&P said.

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