S&P ups Electricidad Argentina

Standard & Poor's said it raised its corporate credit rating on Electricidad Argentina SA by one notch, to B- from CCC+.

In addition, the agency said it raised the senior unsecured debt rating to CCC from CCC-.

The ratings were removed from CreditWatch, where they were placed with positive implications on Jan. 11, S&P said.

The outlook is stable.

According to the agency, the rating action reflects the improvement in the business and financial risk profiles of Electricidad Argentina's 51% owned Empresa Distribuidora y Comercializadora Norte SA, following the approval by the Ente Regulador de la Electricidad of the tariff increase incorporated in the Acta Acuerdo agreement.

The stable outlook incorporates a significant improvement in Edenor's cash flow generation and debt service coverage ratios in 2007 and 2008 deriving from the important tariff increase incorporated in the Acta Acuerdo, which should allow Edenor to distribute dividends to Electricidad Argentina as from fiscal 2008, the agency said.

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