S&P rates Investment Energy, notes BB-

S&P said it assigned its preliminary BB- long-term issuer credit rating on Investment Energy Resources Ltd. Concurrently, the agency gave a preliminary BB- issue-level rating to the company’s proposed senior unsecured notes of up to $700 million with intermediate maturity.

Investment Energy also plans to obtain a $300 million term loan that will rank equally with the notes. Subsidiaries will guarantee the notes and the term loan.

“Our preliminary BB- issuer credit rating on IERL is based on our view of its relatively strong and stable cash flows coming from long-term dollar-denominated PPAs, which compensate for the company's small scale and exposure to high country risk in Central America. These factors – combined with lower maintenance capex, manageable debt servicing needs and discretionary dividends – should allow the company to maintain somewhat aggressive credit metrics,” S&P said in a press release.

IERL plans to transfer the proceeds to its operating subsidiaries to repay in advance project finance debt.

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