S&P rates Aqua America notes A

S&P said it assigned an A rating to Aqua America Inc.'s proposed senior unsecured notes with varying maturities through 2049.

The agency also said it placed the rating on CreditWatch with negative implications.

The proceeds will be used for general corporate purposes, including funding its proposed acquisition of Peoples Natural Gas and refinancing its outstanding debt, S&P said.

The agency said it expects Aqua America's proposed senior unsecured notes to rank behind a significant amount of both secured and unsecured debt issued by its subsidiaries in the consolidated capital structure.

The negative watch reflects the high likelihood that the acquisition will weaken the overall group's consolidated financial measures, which increases the probability for lower ratings, S&P said.

The CreditWatch listing will be resolved in the next few months pending regulatory approval from the Pennsylvania Public Utilities Commission, the agency noted.

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