Moody's eyes NET4GAS for downgrade

Moody's Investors Service said it placed on review for downgrade the Baa2 long-term issuer and senior unsecured debt ratings of NET4GAS, sro (N4G). The outlook has been changed to ratings under review from stable.

“The review for downgrade of N4G's ratings is triggered by the company's exposure to the heightened geopolitical risk for gas transit from Russia (B3 review for downgrade) to Europe, resulting from Russia's further military assault in Ukraine (B3 review for downgrade) which started on Feb. 24, 2022,” Moody’s said in a press release.

The company earns about 75% of its revenues from transporting gas mostly sourced from Russia to Western and Southern Europe under long-term gas transit contracts.

“The review will focus on (1) the evolution and potential effect of sanctions on N4G's cash flow and liquidity, as well as (2) the likelihood of potential shareholder support to the company in the event of financial distress,” the agency said.

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