Fitch ups Mission Energy to BB-

Fitch Ratings said it upgraded and removed from rating watch positive Mission Energy Holding Co.'s issuer default rating to BB- from B, Edison Mission Energy's issuer default rating to BB- from B and Midwest Generation, LLC's issuer default rating to BB from B.

Fitch has upgraded and removed from rating watch positive Mission Energy's senior secured notes to BB- from B-, Edison Mission Energy's senior unsecured notes to BB- from B and Midwest Generation's first-priority term loan to BBB- from BB and second-priority secured notes to BB+ from B+.

The outlook is stable.

The upgrades reflect the beneficial effect of lower financing costs and improved liquidity and financial flexibility as a result of Mission Energy's corporate restructuring and strong cash flow from Mission Energy's low cost coal-fired generation fleet, the agency said.

Fitch said it expects that Mission Energy will use a portion of the $1.6 billion of cash and cash equivalents and short-term investments on its consolidated balance sheet as of June 30 to redeem its $800 million 13½% notes due November 2008.

Nonetheless, Mission Energy's debt burden remains high and its coverage ratios and debt measures weak, the agency said.

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