S&P lifts Transgaz

Standard & Poor's said it raised its long-term corporate credit rating on S.N.T.G.N. Transgaz SA Medias to BBB- from BB+.

The outlook is negative.

The agency said the upgrade reflects Transgaz's improved financial profile, which has been enhanced by the completed initial public offering that will fund part of the company's medium-term investment program, and the increased visibility and amount of operating cash flow following a significant tariff increase and the finalization of tariffs for the regulatory period through June 30, 2012.

The rating on Transgaz is underpinned by the sole licensed status of the operator, the predictable cash flows generated from regulated transmission activities and the company's strong financial profile, S&P said.

These strengths are offset by an outdated asset base, which requires continuous investment; remaining transition-economy features and worsening macroeconomic conditions in Romania; and planned investment in the Nabucco international pipeline project, S&P added.

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