S&P rates AES Gener notes BBB-

Standard & Poor's said that it assigned a BBB- senior unsecured rating to AES Gener SA's proposed 10-year notes and affirmed the BBB- issuer credit ratings on the company.

The proceeds will be used to pay existing debt through an exchange and tender offer on existing notes, in order to extend its debt maturities.

The ratings on Gener continue to reflect its good market position as a reliable power provider in Chile, with lower-than-average exposure to droughts in its core market, its large power-sales contracts with solid offtakers in the SIC (Central Interconnected System) and its good competitive position in the SING (Chilean Northern Interconnected System) and in Colombia, the agency said.

The ratings also consider Gener's high power generation costs under normal hydrological conditions compared with those of other relatively large hydroelectric generators in the SIC and exposure to construction risk, particularly project-delay risk, the agency added.

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