Azerbaijan, Baku, May 14 / Trend /
Fitch Ratings has revised the Outlook on OJSC Azerenerji's (national energy operator) Long-term foreign currency Issuer Default Rating (IDR) to Stable from Positive and affirmed the rating at 'BBB-', the agency's statement said on Monday. Short-term foreign currency IDR was affirmed at 'F3'.
Fitch has also affirmed State Oil Company of the Azerbaijan Republic's (SOCAR) Long-term foreign currency IDR at 'BBB-' with a Stable Outlook. Short-term foreign currency IDR was affirmed at 'F3' while senior unsecured rating was affirmed at 'BBB-'.
"The revision of Azerenerji's Outlook to Stable reflects the agency's revision of the Outlook on the Republic of Azerbaijan's Long-term foreign IDR to Stable from Positive on 11 May 2012 (Fitch revised Azerbaijan's Outlook to Stable; affirmed at 'BBB-'). The revision of the Outlook on the sovereign rating, and consequently Azerenerji's rating, better reflects Fitch's view on their likely direction," the statement says.
Azerenerji's ratings are aligned with the Republic of Azerbaijan ('BBB-'/Stable/'F3') reflecting strong legal, strategic and operational ties with the government of Azerbaijan. At YE11 87.1 percent of the company's debt was guaranteed by the government.
Fitch previously de-aligned the ratings of SOCAR from those of Azerbaijan at a hypothetical sovereign rating level above 'BBB-', largely due to the relatively insignificant direct government guarantees for SOCAR's debt. At the current 'BBB-' sovereign rating level, Fitch assesses government ties with SOCAR as strong. Fitch continues to view SOCAR's standalone business and financial profile as commensurate with the 'BB' rating category.