Moody’s rates Transierra notes Ba3/Aa1.bo

Moody’s Latin America said it assigned Ba3/Aa1.bo ratings to YPFB Transierra SA's proposed $70 million senior unsecured local note offering of class 2 notes.

At the same time Moody's affirmed Transierra's senior unsecured class 1 notes and corporate family ratings of Ba3/Aa1.bo.

The outlook is stable.

Proceeds from the proposed class 2 notes will be used mostly to fund Transierra's working capital needs and its investment program, including the construction of the Parapeti compression plant.

Moody’s said the Ba3/Aa1.bo ratings are supported by Transierra's regulated business model and stable cash flows from capacity payments as well as by sound credit metrics for its rating category. Transierra's credit metrics are strong and very stable, mapping to the investment grade level under the Natural Gas Pipelines methodology and comparing favorably against peers in the region.

For the last 12 months ending September 2015, Transierra's interest coverage surpassed 8.5 times, while FFO to debt was at 45% with no dividends paid during the year.

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