Moody's cuts Singapore Power

Moody's Investors Service said downgraded to Aa3 from Aa1 the issuer rating of Singapore Power Ltd. and the senior unsecured debt rating of wholly-owned subsidiary SP PowerAssets.

The outlook is negative.

This concludes the review for downgrade that began in March when Singapore Power first announced its acquisition of Alinta Ltd.

"The rating downgrade of SingPower reflects the deterioration in its financial profile due to the heavily debt-funded acquisition of Alinta Ltd. in Australia," Gary Lau, a Moody's senior vice president, said in a written statement.

"While this acquisition is in line with SingPower's strategy to invest in regulated network businesses overseas and brings the benefits of further diversification, the consequent material increase in debt level has weakened the group's overall credit profile," Lau added.

The Aa3 rating reflects predictable operating cash flow as well as its low business risk profile, Lau said.

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