S&P boosts Transener

Standard & Poor's said it raised its ratings on Compañía de Transporte de Energía Eléctrica en Alta Tensión Transener SA (Transener) to B from B-.

The outlook is stable.

The agency said that the rating reflects its conclusion that the company's manageable debt maturities in the next three years and sustained demand growth prospects will allow it to maintain credit measures commensurate with the rating category and partially offset some of the regulatory uncertainties that continue affecting the electric sector in Argentina.

In addition, transmission companies would be relatively more protected under a scenario of service interruptions because they represent an operating cost for electric distribution companies and risk of nonpayment is unlikely as long as the distribution companies operate, the agency noted.

S&P said that the ratings on Transener mainly reflect the high political and regulatory risks in Argentina and the company's weak debt-service coverage ratios, high foreign exchange risk and limited financial flexibility.

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