S&P puts South Jersey on watch

S&P said it placed all its ratings for South Jersey Industries Inc. and its subsidiaries South Jersey Gas Co. and Elizabethtown Gas Co. on CreditWatch with negative implications. The ratings on watch include the BBB long-term issuer credit ratings on each entity and the A- issue-level ratings on the subsidiaries’ first mortgage bonds.

South Jersey Industries agreed to be acquired by Infrastructure Investments Fund, an investment vehicle advised by J.P. Morgan Investment Management Inc. for $36 per share and the assumption of consolidated debt of about $3.3 billion.

“While IIF has secured a committed bridge facility to support the transaction, the ultimate funding mix and its future organizational structure remain unclear. If SJI's post-acquisition capital structure includes a higher level of debt leverage than we assume in our current base-case forecast, we would expect its consolidated financial measures to weaken below our downside trigger for the BBB rating,” S&P said in a press release.

The agency said it plans to resolve the CreditWatch over upcoming quarters once it gains more clarity about the future capital structure.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.