S&P: Indiantown bonds on watch

Standard & Poor's said it placed the ratings on Indiantown Cogeneration Funding Corp.'s $505 million first-mortgage bonds due 2020 and Indiantown Cogeneration LP's $125 million tax-exempt bonds due 2015 on CreditWatch with negative implications.

The CreditWatch listing follows Cogentrix Energy Inc.'s (BB-/stable) intention to sell its equity interests in 14 of 18 power plants, including Indiantown. Indiantown Cogen is a 330 MW pulverized coal-fired cogeneration facility in Martin County, Fla., the agency added.

The ratings could be lowered if the new owner is rated below B+, S&P noted, adding that the ratings will not be raised if Indiantown Cogen is purchased by an owner with a stronger credit profile, because the stand-alone credit profile of the project is currently BB+.

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