October 28, Fineko/abc.az. Azerenerji's credit rating has been re-approved at the level of BB/B.
ABC.AZ reports that Standard & Poor's changed the rating outlook from Stable to Negative.
According to the rating agency, the credit rating of Azerbaijan’s electric power company Azerenerji is closely linked to the creditworthiness of the country's government due to the "extremely high" probability of extraordinary state support, as well as taking into account that the entire amount of the company's debt is either guaranteed by the government of Azerbaijan or provided by it.
It is reported that Azerenerji will continue to receive significant state support, including in the form of capital injections, to cover a significant part of the debt servicing costs.
"In this regard, we are revising the Outlook on Azerenerji's ratings from Stable to Negative and confirming the company's credit ratings at BB/B,” S&P Global Ratings says.
It is also assumed that in the event of serious damage to any of Azerenerji's assets, as well as an increased risk to the security of the country's energy system, the government will provide the company with the necessary financial assistance.
In the future Azerenerji may invest in infrastructure development in the territory of Nagorno-Karabakh, but those investments will not be substantial and will not require large borrowings at the company’s level, which will not be supported by the government.
Besides, Azerenerji's ratings may be lowered if the government stops taking measures to provide financial assistance to the company, which will indicate a decrease in the likelihood of providing it with state support.
"We may revise the rating outlook to Stable if the forecast on Azerbaijan's sovereign ratings is revised to Stable," the Agency concluded.
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