S&P assigns Zorlu B-, bonds CCC+

S&P said it assigned Zorlu Yenilenebilir Enerji AS (Zorlu Renewables) a preliminary B- issuer rating and its planned $350 million bond a preliminary CCC+. The coupon is expected to range from 7%-9%.

“Zorlu Renewables is a small-scale generator operating in a high-risk country. The company has 559MW of installed power generation capacity, of which 55% is geothermal, 24% wind, and 21% hydro. In 2020, Zorlu Renewables generated 2.2 terawatt-hours (TWh) of electricity, which is 0.7% of Turkey's total power generation. Zorlu Renewables' assets represent less than 1% of the country's total generating capacity,” S&P said in a press release.

The bond’s rating reflects its subordination to the secured debt at the company’s Dogal subsidiary, the agency explained.

Zorlu plans to use the proceeds to refinance debt, fund capital expenditures, repay shareholder debt and for general corporate purposes.

The outlook is stable.

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