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December 26, 2007 |
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INTERNATIONAL POWER: Fitch Affirms BB Issuer Default Rating Fitch Ratings has affirmed International Power plc's long-term issuer default rating at 'BB' with stable outlook. IPR is a UK holding company for a portfolio of international power assets. The ratings reflect IPR's relatively conservative debt levels and management's prudent approach to expansion of the business and to financing. Unlike several of its peers, IPR has not aggressively pursued double leverage -- the use of holding company debt to fund the "equity" in subsidiaries, associates or joint ventures, which are, themselves, predominantly debt- funded. The stable outlook reflects Fitch's expectation that management will maintain its prudent acquisition and financing strategy. Since the last credit review, IPR has enlarged its engagement in renewable energy sources with its acquisition of Levanto, Maestrale and Schkortleben wind farm portfolios. Further acquisitions included the oil-fired OCGT Indian Queens peaking plant in Cornwall, England and the purchase of the 50% remaining stake in a partnership with Energy Australia. IPR also strengthened its cooperation with Mitsui by creating a common ownership platform for its UK assets in June 2007. Debt finance at the subsidiaries is of non-recourse nature to IPR and almost all of the group's assets are project-financed. For groups financed in this manner, Fitch focuses on debt and cash-flows at the holding company rather than for the consolidated group, since the holding company has limited access to the subsidiaries' assets other than the dividends and has no, or limited, liability associated with the subsidiaries' debts. International Power plc is an independent electricity generating company with interests in over 30,000 MW (gross) of power generating capacity, located in 20 countries, including Puerto Rico. |
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