Research Update: Transportadora de Gas del Sur S.A. (TGS) New Notes Rated 'B+', Existing 'B+' Ratings Affirmed; Outlook Still Stable

Argentina-based natural gas transportation company TGS plans to issue seven-year senior unsecured bullet notes for up to $500 million. The company will use the proceeds to pre-pay its existing notes with an outstanding debt amount of $192 million that mature in 2020, as well as to finance expansion capital investments. We're assigning our 'B+' issue-level rating to the company's proposed notes. At the same time, we're affirming our existing 'B+' foreign and local currency ratings on TGS. The company's stand-alone credit profile (SACP) remains at 'bb'. The stable outlook on the company reflects that of the sovereign. Moreover, it also reflects the its conservative leverage, evidenced by a debt-to-EBITDA ratio below 2x and stability expected, considering that around 60% of

...+ Argentina-based natural gas transportation company TGS plans to issue seven-year senior unsecured bullet notes for up to $500 million. The company will use the proceeds to pre-pay its existing notes with an outstanding debt amount of $192 million that mature in 2020, as well as to finance expansion capital investments. + We're assigning our 'B+' issue-level rating to the company's proposed notes. At the same time, we're affirming our existing 'B+' foreign and local currency ratings on TGS. The company's stand-alone credit profile (SACP) remains at '##'. + The stable outlook on the company reflects that of the sovereign. Moreover, it also reflects the its conservative leverage, evidenced by a debt-to-EBITDA ratio below 2x and stability expected, considering that around 60% of its EBITDA comes from the regulated natural gas distribution business....

Research Update