Fitch rates Rio Energy notes B

Fitch Ratings said it assigned for the first time long-term foreign- and local-currency issuer default ratings of B and B+, respectively, to Rio Energy SA, UGEN SA and Uensa SA.

The outlook on the foreign-currency ratings is positive and the outlook on the local-currency ratings is stable.

Fitch also said it assigned an expected rating of B with recovery rating of RR4 to the proposed senior secured notes of up to $550 million to be co-issued by Rio Energy (Rojo), UGEN (Barker) and Uensa (Villa Maria).

Rojo, Barker and Villa Maria are thermal power generation plants each with a current capacity of 150 megawatts, the agency said.

The co-issuers will be jointly and severally liable for any payment obligations under the notes, Fitch said.

The proceeds will be used to refinance existing debt at each entity and for general corporate purposes, including working capital, the agency said.

The ratings reflect the companies' exposure to Argentina's high regulatory risk and lack of operating history, Fitch said.

These risks are mitigated by their central role in fulfilling the country's high capital investment needs in the sector to reduce the energy deficit, the agency said.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.