Fitch cuts Wisconsin Energy, debt to BBB+

Fitch Ratings said it downgraded Wisconsin Energy Corp.'s issuer default rating and senior unsecured debt ratings to BBB+ from A- and affirmed the short-term issuer default rating and commercial paper ratings at F2.

The outlook is stable.

Concurrently, the agency downgraded Wisconsin Energy Capital Corp.'s $50 million senior unsecured notes due in 2028 to BBB+. Wisconsin Energy Capital’s debt obligation is supported by an agreement with Wisconsin Energy and, as such, its debt instrument rating reflects the credit profile of Wisconsin Energy.

Fitch removed the ratings from Rating Watch Negative where they were placed June 24, 2014, following Wisconsin Energy’s announcement of the proposed acquisition of Integrys Energy Group, Inc. (unrated). With the merger approvals from Wisconsin and Michigan already secured, the agency said it has greater confidence that Wisconsin Energy can successfully complete the pending merger, and therefore finds it appropriate to resolve the Rating Watch Negative at this time.

Fitch said the downgrade follows its expectation that Wisconsin Energy will soon issue about $1.5 billion of senior unsecured long-term debt to finance the cash consideration of the transaction. The agency understands that the debt issuance is expected to include a call option in the event that the merger does not consummate.

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