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Prospect News home > News index > List of issuers R > Headlines for Reliant Energy Inc. > News item |
Fitch lowers Reliant Energy
Fitch Ratings said that Reliant Energy, Inc.'s (RRI) issuer default rating has been downgraded to B from B+.
At the same time, Fitch said the company's senior secured debt is affirmed at BB- with a recovery rating upgraded to RR2 from RR3 and RRI's senior subordinated convertible notes were affirmed at B with its recovery rating lifted to RR4 from RR5.
The outlook is stable.
Fitch added the lowering of RRI's IDR reflects the higher business risk and future cash flow uncertainty resulting from RRI's transition to a substantially merchant model for its U.S. wholesale generating business, limited opportunities to improve leverage and coverage ratios beyond B parameters through 2008 under a conservative natural gas price scenario and continued margin uncertainty at RRI's retail electric provider segment as the Texas market evolves from the current incumbent Price-To-Beat structure to a full competitive model in 2007.
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