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S&P cuts Cordova Funding bonds to B
Standard & Poor's said it lowered its rating on Cordova Funding Corp.'s $225 million series A senior secured bonds due 2019 to B from B+.
The outlook is negative.
Cordova Funding is the funding vehicle that issued debt and subsequently loaned the proceeds to its affiliate, Cordova Energy Co. LLC, which guarantees Cordova Funding's payment obligations. Cordova, which is wholly owned by MidAmerican Energy Holdings Co. (BBB-/positive/--), completed the 537 megawatt natural gas-fired, combined-cycle power plant located in Rock Island County, Ill., in June 2001.
S&P said the downgrade reflects the project's reliance on a tolling agreement with El Paso Merchant Energy Co. that expires in 2019. El Paso Corp. (B/negative/--) guarantees the obligations of El Paso Merchant Energy.
S&P recently lowered the rating on El Paso to B from B+.
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