Moody's reviews Kinder Morgan

Moody's Investors Service said it put the ratings of Kinder Morgan Inc., Kinder Morgan Energy Partners, LP and El Paso Pipeline Partners Operating Co. on review after the announcement that they intend to merge.

The following ratings were placed on review for upgrade:

• Kinder Morgan’s Ba2 corporate family rating of Ba2, Ba2-PD probability of default rating and Ba2 senior note rating;

• El Paso Holdo LLC’s Ba2 senior note rating, Ba2 medium-term note rating and B1 convertible subordinated note rating;

• Kinder Morgan Finance Co., ULC’s Ba2 senior note rating;

• Kinder Morgan Kansas Inc.’s Ba2 senior note rating and B1 junior subordinated note rating;

• Kinder Morgan GP, Inc.’s Ba2 preferred stock rating;

• KN Capital Trust I’s and KN Capital Trust III’s B1 preferred stock ratings;

• El Paso Pipeline Partners’ Ba1 corporate family rating, Ba1-PD probability of default rating and Ba1 senior note rating;

• El Paso CGP Co.’s Ba2 senior note rating;

• Colorado Interstate Gas Co.’s Baa3 senior note rating;

• Sonat Inc.’s Ba2 senior note rating;

• Southern Natural Gas Co.’s Baa3 senior note rating; and

• El Paso Energy Capital Trust I’s B1 preferred stock rating.

The following ratings were placed on review for downgrade:

• Kinder Morgan Energy Partners’ Baa2 senior note rating;

• Copano Energy, LLC’s Baa2 senior note rating;

• Tennessee Gas Pipeline Co.’s Baa1 senior note rating;

• El Paso Natural Gas Co.’s Baa1 senior note rating; and

• El Paso Tennessee Pipeline Co.’s Baa2 senior note rating.

The agency said Kinder Morgan's large portfolio of high-quality assets generates a stable and predictable level of cash flow that could support a strong investment-grade rating. However, because of the high leverage along with a high dividend payout ratio, Moody’s expects the new Kinder Morgan to be weakly positioned with an investment-grade rating.

© 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.