Moody’s cuts four U.K. infrastructures

Moody's Investors Service said it downgraded to Aa2 from Aa1 the ratings of four U.K.-domiciled infrastructure and project finance issuers: Network Rail Infrastructure Finance plc; LCR Finance plc; Ineos Grangemouth plc; and Merseylink (Issuer) plc.

The outlook is stable.

The actions follow the downgrade of the Government of the United Kingdom's rating to Aa2 from Aa1 and the change in outlook from negative to stable.

Moody’s said the key drivers for the downgrade of the U.K.'s rating to Aa2 are:

• The outlook for the U.K.'s public finances weakened significantly since the negative outlook on the Aa1 rating was assigned, with the government's fiscal consolidation plans increasingly in question and the debt burden expected to continue to rise; and

• Fiscal pressures will be exacerbated by the erosion of the U.K.'s medium-term economic strength that is likely to result from the manner of its departure from the European Union, and by the increasingly apparent challenges to policy-making given the complexity of Brexit negotiations and associated domestic political dynamics.

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