S&P puts Southern Union on watch

Standard & Poor's said it placed its BBB corporate credit ratings on Southern Union Co. and affiliates Panhandle Eastern Pipe Line LP, CrossCountry Energy LLC, Transwestern Holding Co. LLC and Transwestern Pipeline Co. LLC on CreditWatch with negative implications, following Southern Union's announcement of a series of transactions that will effectively increase its ownership interest in Citrus Corp., parent to Florida Gas Transmission Co. (BBB+/stable), to 50% from 25% and eliminate its ownership interest in Transwestern Pipeline.

At the same time, S&P said it affirmed its BBB+ corporate credit rating on Florida Gas Transmission. The outlook is stable.

The rating affirmation for Florida Gas is based on its continued ownership by affiliates of Southern Union and El Paso Corp., the agency added, noting that the CreditWatch listing on Southern Union reflects its expected contribution of $455 million to repay its pro rata share of CCEH's existing debt and to fund the remainder of the transactions.

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