Moody’s assigns Aegea debs Ba2

Moody´s Investors Service said it assigned Ba2/Aa1.br (respectively, in global and Brazil´s national scale) to Aegea Saneamento´s new debenture issuance of R$305 million due in 2025. The outlook is stable.

The proceeds will be used to fund Aegea’s investments and strengthen cash liquidity. The debentures have cross-default provisions with other company debt as well within the group and contains a net debt to EBITDA financial covenant equal or lower than 3.5x, verified on a semiannual basis, which could trigger debt acceleration, among other clauses, the agency said.

“The debenture´s rating factors in a one notch down structural subordination from Aegea´s corporate family rating since Aegea is a non-operational holding company and a vehicle for controlling stakes on the operating subsidiaries. Aegea largely depends on the regular payment of dividends up-streamed by its operating subsidiaries to meet its obligations, equity investment commitments and potential cash requirements related to its guarantees,” Moody’s said in a press release.

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