Fitch rates International Power BB

Fitch Ratings said it assigned International Power plc a BB long-term issuer rating.

The outlook is stable.

The company currently has no capital markets senior unsecured debt, other than an in-the-money convertible bond due 2023, the agency said.

The ratings benefit from International Power's relatively conservative debt levels and management's prudent approach to expansion and financing, Fitch said. Unlike several of its peers, the company has not aggressively pursued double leverage - the use of holding company debt to fund the "equity" in subsidiaries, associates or joint ventures which are themselves predominantly debt funded.

International Power's credit quality benefits from the non-recourse nature of almost all of the group's debt. However, the agency said that International Power's debt service is dependent on cash distributed by project-financed subsidiaries and associates which represents a credit weakness, especially as project finance debt generally contains distribution lock-up covenants.

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