S&P: sale aids Westar credit

Standard & Poor's said Wednesday that Westar Energy Inc.'s (BB+/positive/--) announced common stock issuance will enhance the company's frail financial condition.

Westar plans to offer 9.25 million shares of common stock (excluding an over-allotment option of about 1.4 million shares granted to the underwriters) for a total potential offering of about $183 million at current trading levels of about $20 per share. The bulk of the proceeds will be used to repay outstanding debt.

S&P said improvement in the company's financial profile was anticipated by S&P and has been factored into the positive rating outlook. Although this is a critical step in Westar's debt reduction strategy, additional credit-enhancing measures are needed to achieve investment-grade ratings.

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