CMS Energy Corp.'s Subordinated Debentures Rated 'BBB-'

NEW YORK (S&P Global Ratings) Nov. 19, 2020--S&P Global Ratings today assigned its 'BBB-'issue-level rating to CMS Energy Corp.'s fixed-to-fixed reset rate junior subordinated notes due in 2050. CMS intends to use the net proceeds for general corporate purposes, to fund working capital, and repay debt. We classify these notes as hybrid securities with intermediate equity content (50%). We rate them two notches below our 'BBB+' long-term issuer credit rating on CMS Energy to reflect their subordination and the company's ability to defer interest payments. Our intermediate equity treatment is premised on the instrument's permanence, subordination, and deferability features. The instrument's equity content will be revised to minimal as of December 1, 2030, after which there is less than 20

...November 19, 2020 NEW YORK (S&P Global Ratings) Nov. 19, 2020--S&P Global Ratings today assigned its '###-'issue-level rating to CMS Energy Corp.'s fixed-to-fixed reset rate junior subordinated notes due in 2050. CMS intends to use the net proceeds for general corporate purposes, to fund working capital, and repay debt. We classify these notes as hybrid securities with intermediate equity content (50%). We rate them two notches below our '###+' long-term issuer credit rating on CMS Energy to reflect their subordination and the company's ability to defer interest payments. Our intermediate equity treatment is premised on the instrument's permanence, subordination, and deferability features. The instrument's equity content will be revised to minimal as of December 1, 2030, after which there is less than 20 years to maturity. The securities' long-dated nature and the company's limited ability and lack of incentives to redeem the issue for a long-dated period meet our standards for permanence....

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