On Aug. 2, 2007, Standard&Poor's Ratings Services revised its outlook on Austria-based utility KELAG AG to negative from stable, owing to the recently announced more aggressive long-term investment strategy by its majority owners. At the same time, the 'A+' long-term corporate credit rating on the company was affirmed. The ratings on KELAG reflect the company's sound business profile, owing to its strong local position in electricity supply and its natural monopoly on regional electricity distribution in the Austrian State of Carinthia. These strengths are offset by its small size, its operation in a fully liberalized energy market, and regulatory pressure from the incentive-based regime for setting network tariffs. Carinthia controls 51.0% of Kärnten Energieholding Beteiligungs GmbH (KEH), which
