The ratings on Aquila Inc. are on CreditWatch with negative implications due in part to uncertainties surrounding the company's intent to acquire power producer Cogentrix Energy Inc. When the merger is complete, Cogentrix will be a wholly owned subsidiary of Aquila, and its debt will be guaranteed by Aquila. Cogentrix is a U.S. independent power producer, with ownership in more than 30 power plants in operation totaling over 4,000 MW of generation capacity. Its portfolio of generating assets is mainly in the U.S. and involves an equal mix of coal-fired and gas-fired assets. The Cogentrix transaction would add both positive and negative elements to Aquila's credit profile, but, on balance, it has a greater potential to lower the company's overall
