S&P affirms E.ON

S&P said it affirmed its BBB/A-2 long- and short-term issuer credit ratings on E.ON SE and its subsidiaries E.ON U.K. plc and E.ON Energy Solutions Ltd.

The outlook is stable.

At the same time, the agency affirmed the BBB issue rating on the group's senior unsecured debt and the A-2 rating on its commercial paper.

S&P said the affirmation follows E.ON's announcement that it has reached an agreement with RWE AG to acquire RWE's 76.8% stake in innogy through a reserved capital increase in kind and a wide-ranging exchange of assets.

“In our view, the transaction will strengthen E.ON's business risk profile due to the significant increase in stable regulated power network assets following the asset swap,” the agency said in a news release.

“Nevertheless, we anticipate a temporary weakening of credit measures following the transaction, since E.ON will assume innogy's debt while, as we understand, assets that it transfers to RWE would carry significantly lower leverage.”

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