DBRS has announced that it:
has today upgraded the ratings of Fortis Inc. (Fortis or the Company) to A (low) and Pfd-2 (low) from BBB (high) and Pfd-3 (high), respectively. The trends have been changed to Stable from Positive.
The upgrade is driven by the Company’s low business risk profile (benefiting from its ownership of a diversified basket of utility businesses, which provide over 90% of consolidated EBITDA), its reasonable credit metrics (which have improved modestly over the years), the significant reduction in external debt at subsidiary Terasen Inc., and the Company’s demonstrated ability to acquire and integrate stable utility businesses financed on a conservative basis.
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At the time of our last review in June 2010, when the trends were changed to Positive, DBRS stated that it would consider an upgrade of Fortis’s ratings if the Company continued to exhibit strong financial and operating performance and as long as its operating subsidiaries would not suffer any material negative regulatory action in the near future or pursue any mergers and acquisitions activity financed on an aggressive basis.
There are the following issues outstanding: FTS.PR.C & FTS.PR.E (OpRet); FTS.PR.F (PerpetualDiscount); and FTS.PR.G & FTS.PR.H (FixedReset). These will be moved (volume permitting) to their appropriate HIMIPref™ rebalancing, as of October 31.
FTS was last mentioned on PrefBlog when DBRS assigned the positive trend.
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