S&P cuts Texas Competitive, Energy Future

Standard & Poor's said it lowered its corporate credit rating on Texas Competitive Electric Holdings Co. LLC to D from CCC-, based on a payment default and an imminent and unavoidable bankruptcy filing.

The agency also lowered all of Texas Competitive's debt ratings, except those debt ratings already at D. The recovery rating on its first-lien debt was downgraded to 4 from 3, based on updated valuation and claims.

S&P lowered its corporate credit ratings on each of Energy Future Holdings Corp., Energy Future Intermediate Holdings Co. LLC and Energy Future Competitive Holdings Co. LLC to CC from CCC-. All debt ratings, except for the Energy Future Intermediate second-lien debt rating and those debt ratings already at D, were downgraded.

For Energy Future Intermediate second-lien debt, the recovery rating was revised to 2 from 5.

"We expect EFH, EFIH, EFCH, and TCEH to file for Chapter 11 bankruptcy protection very soon. TCEH did not pay interest on certain first-lien, second-lien, and unsecured debt issues on April 1, 2014," S&P credit analyst Terry Pratt said in a news release.

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