Fitch raises Greensands, bonds

Fitch Ratings said it upgraded Greensands UK Ltd.'s long-term issuer default rating to B+ from B and its senior secured rating to BB- from B+.

The outlook on the issuer default rating is stable.

At the same time, the agency upgraded the bonds issued by Southern Water (Greensands) Financing plc (SWF), which are unconditionally and irrevocably guaranteed by Greensands as well as its parent, Greensands Holdings Ltd., and its two subsidiaries, Greensands Junior Finance Ltd. and Greensands Senior Finance Ltd., to BB-/RR3 from B+/RR3.

Greensands is a holding company of Southern Water Services Ltd., one of 10 appointed regulated water and sewerage companies (WaSC) in England and Wales.

Fitch said the actions reflect its expectations for improved cash flow generation and subsequent increased dividend capacity of the group's main operating company, Southern Water, which would materially increase Greensands' dividend cover over the new five-year price control period from April 2015 (AMP6). This is in spite of the pressures that U.K. water companies face on their credit metrics due to Ofwat's (the regulator for the U.K. water sector) final determination of tariffs for AMP6 and a slowdown in retail price inflation, the agency said.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.