Fitch Places NRG Energy on Rating Watch Evolving Following Acquisition Offer
More News related to Press Releases
- NASCAR(R) Driver Kyle Petty Comes Through for Fans Around the Country with Offer of Free Coke Zero
- Lottery's Millionaire Raffle Drawing Creates Four New Millionaires
- Big Spin(R) Contestant Plans Shoe Shopping Spree
- Press Gaggle by Dana Perino, Dan Price, Assistant to the President for International Economic Affairs, and Dennis Wilder, NSC Senior Director for Asian Affairs
- Farmers Insurance Claims Teams Helping Customers in or Near the Goleta, California Wildfires
CHICAGO--(BUSINESS WIRE)--
Fitch Ratings has placed all its ratings of NRG Energy Inc. (NRG), including the Issuer Default Rating (IDR) of 'B', on Rating Watch Evolving following NRG's unsolicited offer to acquire Calpine Corp (CPN, not rated by Fitch) in a stock-for-stock transaction. Evolving signifies that Fitch may upgrade, downgrade or affirm NRG's ratings pending future information and analysis.
Ratings placed on Rating Watch Evolving:
--IDR at 'B';
--Senior secured term loan B at 'BB/RR1';
--Senior secured revolving credit facility at 'BB/RR1';
--Senior notes at 'B+/RR3';
--Convertible preferred stock at 'CCC+/RR6'.
Approximately $8.7 billion of debt is affected.
The Watch Evolving status reflects both the unresolved nature of the offer and, should the transaction proceed, the uncertainty of the acquisition's impact on NRG's credit profile. Concerns and uncertainties include CPN's response to the unsolicited offer, the possibility of higher competing offers, and the absence of final terms and pricing. Fitch expects to resolve this Rating Watch when and if the transaction occurs. As more details about the combined company's cash flows, generation fleet, debt and capital structure emerge, Fitch may revise the Watch status. Leverage may still remain a ratings concern even in the face of an all-stock transaction given likely earnings dilution.
A combined NRG/CPN would have roughly 45,000 MWs (megawatts) of generating capacity located in the South Central U.S., Northeastern U.S., Texas and California. The combined company would be the largest competitive generator in the world.
Fitch revised NRG's Rating Outlook to Positive in December 2007 based on its improving credit profile and favorable fundamentals for the competitive generator sector. Should the transaction not be consummated, NRG's Outlook would likely return to Positive.
Fitch's rating definitions and the terms of use of such ratings are available on the agency's public site, www.fitchratings.com. Published ratings, criteria and methodologies are available from this site, at all times. Fitch's code of conduct, confidentiality, conflicts of interest, affiliate firewall, compliance and other relevant policies and procedures are also available from the 'Code of Conduct' section of this site.
Source: Fitch Ratings
Stocks Mentioned
Sign up for StreetInsider Free!
Recieve full access to all new and archived articles, unlimited portfolio tracking, e-mail alerts, custom newswires and RSS feeds - and more!
