Moody's downgrades Repsol

Moody's Investors Service said it downgraded the long-term issuer rating of Repsol SA to Baa3 from Baa2, the senior unsecured long-term rating of Repsol International Finance BV to Baa3 from Baa2 and its short-term rating to Prime-3 from Prime-2.

Concurrently, Moody's also downgraded the preferred stock rating of Repsol International Capital Ltd. to Ba2 from Ba1.

The outlook is stable.

"The rating downgrade reflects the negative impact of Argentina's expropriation of Repsol's 51% stake in YPF on Repsol's overall credit profile," Moody's vice president, senior credit officer and lead analyst for Repsol Francois Lauras said in a news release.

"The loss of its controlling stake in YPF reduces the scale and diversity of Repsol's business profile, and deprives the group of sizeable assets and the YPF dividend stream," Lauras added in the release.

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