S&P: Fort Chicago on watch

Standard & Poor's said it placed its BBB long-term corporate credit rating on Fort Chicago Energy Partners LP on CreditWatch with negative implications following Fort Chicago's announcement that it intends to acquire Countryside Power Income Fund. Countryside has power facilities in California and district energy systems in Prince Edward Island and Ontario.

The price of C$203 million, including debt and net of cash, values Countryside at about 10x its EBITDA, the agency said, adding that Fort Chicago intends to finance the acquisition with leverage of about 55%-65%.

The agency said it placed its SR-2 Canadian stability rating on Fort Chicago on StabilityWatch with negative implications.

"The purchase is consistent with Fort Chicago's sustainability profile of acquiring assets with stable cash flows backed by long-term contracts," said S&P stability analyst John Clements.

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