Fitch lowers Corpoelec, debt

Fitch Ratings said it downgraded Corporacion Electrica Nacional SA's (Corpoelec) foreign and local currency issuer default ratings to CCC from B.

The agency also downgraded roughly $650 million of senior unsecured debt outstanding to CCC/RR4 from B/RR4 and the company’s national long-term rating to AA(ven) from AAA(ven)

The national short-term rating was affirmed at F1+(ven).

The outlook is negative.

Fitch said the downgrade follows the Dec. 17 downgrade of the sovereign ratings of Venezuela to CCC from B. The downgrade of the sovereign ratings reflects the sharp decline of international oil prices, which increase balance of payments pressures in the context of reduced external financing flexibility and rising macroeconomic instability.

Corpoelec's ratings reflect the company's strong linkage to the government of Venezuela (rated CCC/negative), given its tight integration into the public sector determined by its 100% public ownership and its dependence on public funding to carry on its day to day operations, honor its financial obligations and finance its capital expenditure needs, the agency said.

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