Post by
AlwaysLong683 on Jan 12, 2023 9:36am
Need to Keep BBB Credit Rating
Looks like AQN is committed to this, and they should be.
A BBB credit rating is considered Lower Medium Investment grade by S&P and Fitch.
A downgrade to BBB- is the lowest investment grade rating.
A downgrade to BB+ and you're in Junk Bond territory with a significant jump in interest rates on your debt and less lenders willing to deal with you.
Almost all Investment Grade borrowers want to stay at BBB or higher to give them a one rating buffer from junk rating status, so I think AQN has no choice but to do whatever it takes to keep its BBB rating.
Question is, how much will AQN get for the assets they wish to sell, and will it be more than they paid to originally build / acquire them? Need to see what the appetite is in 2023 for what they are selling.