Moody’s shifts PPL outlook to positive

Moody’s Investors Service said it revised the outlooks for PPL Corp. and PPL Capital Funding Inc. to positive from stable.

The outlook revision is prompted by PPL's announcement it agreed to sell Western Power Distribution plc and its distribution network operator subsidiaries in the U.K. to National Grid plc. PPL will acquire Rhode Island-based Narragansett Electric Co. from National Grid. PPL plans to use some of the cash proceeds from the Western Power sale to lower parent company leverage, Moody’s said.

"The divestiture of its U.K. assets provides an opportunity for PPL to improve its credit profile as it becomes a US-only utility holding company with operations in three supportive regulatory jurisdictions, namely Kentucky, Pennsylvania and now Rhode Island," stated Jairo Chung, a Moody's vice president-senior analyst, in a press release.

"In addition, the positive outlook reflects our expectation that PPL will use proceeds from the sale to meaningfully reduce parent-level debt," added Chung.

The agency affirmed all their ratings, including PPL’s Baa2 issuer rating and PPL Capital’s Baa2 senior unsecured ratings.

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