S&P rates Mosenergo bonds BBB+(ru)

Standard & Poor's said it assigned its BBB+(ru) Russia national-scale rating to the proposed Russian ruble 5 billion unsecured bonds due 2011 to be issued by Mosenergo (AO) (B-/positive, Russia national-scale BBB+(ru)).

The bonds have 10 semiannual coupon periods and a put option at the end of the sixth coupon period, the agency said.

The ratings on Mosenergo reflect the risks associated with ongoing power sector reform in Russia and the possibility of political influence on the tariff-setting process, S&P said, adding that these risks are offset by Mosenergo's strong competitive position in the relatively lucrative, solvent and growing Moscow region, which includes the City of Moscow (foreign currency BBB+/stable) and the Moscow Oblast (foreign currency BB/stable) and its diversified combined heat and power generation portfolio.

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