S&P upgrades Kuwait Energy

S&P said it raised Kuwait Energy plc's issuer rating to B- from CCC+ and removed them from CreditWatch with positive implications.

In March, United Energy Group completed the acquisition of Kuwait Energy, S&P noted.

The agency said the transaction will support Kuwait Energy's credit profile, particularly given its tight liquidity due to the upcoming maturity of its $250 million bond in August 2019.

The stable outlook reflects an expectation that United Energy will support Kuwait Energy's immediate liquidity needs and both companies will maintain moderate leverage over the next 12- to 18-months, S&P said.

The ratings consider a view of the company's high reserves, solid profitability and low debt levels, the agency said.

S&P also said it takes into account the company's exposure to higher risk countries, such as Iraq and Egypt.

The company has a smaller scale compared with peers, which increases its exposure to the cyclical nature of the exploration and production business, the agency said, and its sizable expenditure needs.

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