S&P assigns BB rating to HSE

Standard & Poor’s said it assigned a preliminary BB long-term corporate credit rating to Holding Slovenske Elektrarne (HSE).

The outlook is positive.

The preliminary BB rating is based on a view that HSE has a weak business risk profile and a highly leveraged financial risk profile, leading to a stand-alone credit profile of B+, S&P said.

The rating is two notches above its stand-alone rating to reflect a view of the moderately high likelihood that the Slovenian government would provide timely and sufficient extraordinary support to HSE in the event of financial distress, S&P said.

The rating also considers its status as a government-related entity and important role as both a provider of an essential service and key player in the implementation of state energy policies, the agency said.

HSE’s production capacity is limited and diversification is relatively low with only a few hydro and thermal plants, S&P said.

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