Moody's rates Energipe, Saelpa notes Ba3

Moody's Investors Service said it assigned a Ba3 rating to the $250 million 10½% seven-year notes jointly, not severally, issued by Empresa Energetica de Sergipe (Energipe) for $162.5 million and by Sociedade Anônima de Eletrificacão da Paraiba (Saelpa) for $87.5 million and guaranteed by Energisa SA.

Moody's also affirmed the Ba3 local-currency corporate family and A3.br Brazil national scale corporate family ratings for Energisa SA.

The outlook is stable.

The Ba3 rating considers Energisa's monopoly position in some electricity markets as well as its strong credit metrics for the rating category, the agency said.

The rating also reflects an evolving regulatory environment and relatively weak liquidity management given the lack of any committed standby credit facilities in place and potential uncertainty about the company's ability to continue to have access local capital markets, Moody's said.

Energisa's rating also considers the group's recent corporate restructuring and reflects Moody's expectation that debt reduction will continue over the coming years, the agency said.

The most important factor constraining ratings is the Brazilian regulatory framework, which has undergone substantial change over the past several years and has a history of being unpredictable, Moody's said.

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