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C.A. La Electricidad De Caracas
Standard & Poors, April 2011
Standard and Poors RatingsXpress Credit Research provides in-depth coverage of international corporates, financial institutions, insurance companies, utilities, sovereigns and structured finance programs. RatingsXpress Credit Research lets users determine the credit rating of holdings and identify key factors underlying an issuer's creditworthiness, distinguishes the different risk exposures for new and existing deals, and provides an understanding of how their analysts interpret key regulatory, political and environmental events and their economic impact.
Research Type: Full Analysis
Abstract
Implicit support from the Venezuelan government and state-owned oil company PDVSA while becoming fully integrated with CORPOELEC; Plan for CORPOELEC to assume EDC's debt obligations; Integration and synergy among distribution, generation, and commercialization; and De facto monopoly in its service area. Operation in Venezuela's volatile regulatory environment; Role as a non-rent-seeking enterprise; Rate-setting policy that doesn't fully compensate all cost increases, constraining top-line growth; and Highly leveraged financial profile resulting from higher operating costs. The rating on C.A. La Electricidad De Caracas (EDC) reflects a deterioration of its stand-alone credit profile (SACP), which we recently revised to 'b-' from 'b'. The downgrade resulted from a sharp decline in EDC's profitability and cash flow generation as it adjusted to a new...
Companies mentioned in this report are: C.A. La Electricidad De Caracas ,Petroleos de Venezuela S.A.
Action: Review
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