Moody’s upgrades Cemig

Moody's Investors Service said it upgraded the corporate family ratings of Companhia Energetica de Minas Gerais (Cemig) to B2/Ba1.br from B3/B2.br, respectively in global and national scale.

The agency said the upgrade reflects its updated views on Cemig's baseline credit assessment and upgrade to b2 from caa1.

Moody's also upgraded the global and national scale issuer, senior unsecured and senior secured ratings assigned to Cemig Distribuicao SA and Cemig Geracao e Transmissao SA to B2/Ba1.br from B3/B2.br.

The agency placed all ratings under review for upgrade.

Moody’s said the action follows Cemig's announcement that it received a R$1.1 billion payment from the government of Brazil (Ba2 stable) for unamortized investments in the São Simão and Miranda hydro project concessions, which expired and were reauctioned to other companies in 2017.

The agency said the payment significantly improves the company's liquidity profile, and depending on the company's medium-term strategy, could also lead to a moderate improvement in gross leverage metrics.

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