S&P ups Edison Funding outlook to stable

Standard & Poor's said it revised its outlook on Edison Funding Co. to stable from negative, adding that it affirmed its ratings on Edison, including the BB+/B counterparty credit rating.

Edison Funding is a wholly owned, unregulated subsidiary of Edison Capital, a subsidiary of Edison Mission Group Inc., which is in turn a wholly owned subsidiary of Edison International (BBB-/stable), the agency said.

The agency noted that this rating action follows the announcement that Edison and the Internal Revenue Service have formally concluded a global settlement that will resolve federal tax disputes related to cross-border, leveraged leases formerly held by Edison Funding.

"Although the agreement with the IRS will significantly weaken Edison Funding's stand-alone credit profile, the agency said it believes that Edison Funding has the financial capacity and incentive to meet Edison Funding's obligations if additional support is needed," said credit analyst Rian M. Pressman, CFA.

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