Fitch upgrades Cemig

Fitch Ratings said it upgraded Companhia Energetica de Minas Gerais (Cemig)’s and its wholly owned subsidiaries Cemig Distribuicao SA’s (Cemig D) and Cemig Geracao e Transmissao SA's (Cemig GT) long-term foreign and local currency issuer default ratings to B from B- and long-term national scale ratings to BBB-(bra) from BB-(bra).

At the same time, the agency upgraded the local debentures issuances to BBB-(bra) from BB-(bra) and affirmed Cemig GT's $1 billion eurobond issuance at B, with its respective recovery rating changing to RR4 from RR3.

Fitch removed the rating watch negative from all ratings and assigned a stable outlook.

Fitch said the upgrade reflects Cemig's ability to refinance a large portion of its short-term debt maturities and improve its liquidity profile since the end of 2017.

The group was able to refinance around R$3.4 billion with banks, issued the $1 billion eurobonds, had a capital injection of R$1.3 billion and sold around R$700 million in Transmissora Alianca de Energia Eletrica SA's (Taesa) shares.

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