S&P upgrades Dynegy

S&P said it raised its corporate credit rating on Dynegy Inc. to BB from B+ and removed the rating from CreditWatch, where it was placed with positive implications on Oct. 30, 2017.

The outlook is stable.

At the same time, the agency raised the issue-level rating on the company's secured debt to BBB- from BB and the issue-level rating on its unsecured debt to BB from B+ and removed the ratings from CreditWatch.

The 1 recovery rating on the secured debt remains, indicating an expectation for very high (90%-100%; rounded estimate: 95%) recovery in the event of a payment default. The 3 recovery rating on the company's unsecured debt indicates an expectation for meaningful (50%-70%; rounded estimate: 55%) recovery.

S&P said the upgrade reflects the recent closing of Dynegy's merger with Vistra Energy Corp.

“While the transaction has not changed our opinion of the company's standalone credit quality, we raised our rating to indicate Dynegy's core status within Vistra Energy,” the agency said in a news release.

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