Moody's lowers Energy Future

Moody's Investors Service said it downgraded the ratings of Energy Future Holdings Corp. and its unregulated subsidiary, Texas Competitive Energy Holdings including Energy Future's corporate family rating and probability of default rating to Caa1 from B3.

According to the agency, the company's speculative-grade liquidity rating of SGL-3 is affirmed.

The outlooks remain negative.

Moody's noted that the downgrade and negative outlook reflect its concerns regarding the long-term sustainability of Energy Future's business model, and these concerns primarily reflect the about $44 billion of debt and roughly $20 billion of other gross liabilities currently on the balance sheet versus negative book equity of $3.2 billion.

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