Moodys downgrades Romanian power grid operator Transelectrica.

By bne IntelliNews July 5, 2012
International rating agency Moody's said it downgraded the rating of Romanian power grid operator Transelectrica to Ba1 from Baa3 on July 4, removing thus the company from the investment-grade area. The action reflects a downward revision, to strong from high, of the assumed level of extraordinary support that the company can expect to receive from its majority owner - the Romanian government, Moody's said in a statement. We recall that in June, state-owned hydropower operator Hidroelectrica unexpectedly filed for insolvency causing concerns related to the soundness of Romanian state-owned companies and the support the state can provide them with in such situations under budget constraints and anti-trust regulations. Transelectrica remains on review for a further downgrade, which will depend on the company's liquidity position that is to the high extent linked to the company's ability to continuously raise external funding in order to cover its sizeable investment plan, the rating agency said. Transelectrica is 58.7%-held by the Romanian state following a 15% SPO in March via which the government raised EUR 37.6mn.
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