Moody's lifts IEnova view to stable

Moody's Investors Service said it changed the outlook of Infraestructura Energética Nova SAB de CV (IEnova) to stable from negative and affirmed the rating of Baa1 to the $840 million senior unsecured notes.

The outlook revision follows the recent rating actions on the ratings and outlooks of the government of Mexico, along with the Comisión Federal de Electricidad (CFE) and Petróleos Mexicanos (Pemex).

IEnova is linked to government's related entities, specifically CFE, Centro Nacional de Control del Gas Natural and Pemex, Moody's explained.

The Baa1 rating on the company's notes reflects an expectation that IEnova will record key financial metrics, including funds from operations-to-debt of more than 20% on a projected basis, the agency said.

Moody's said it recognizes that in 2017 and so far in 2018, IEnova experienced a temporary weakening of financial metrics as a result of acquisitions and new debt-funded projects that have yet to generate cash flows.

But the agency said it expects the new projects will become operational and generate cash flows as expected.

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