The ratings on United Waterworks are tied to the credit quality of its ultimate parent, Suez S.A. (A-/Watch Pos/A-2) The ratings on United Waterworks were placed on CreditWatch with positive implications on March 2, 2006. The CreditWatch listing reflects the improvement in Suez's business and financial risk profiles that would result from its merger with lower-risk Gaz de France S.A. (AA-/Watch Neg/A-1+) To resolve the CreditWatch listing on Suez, Standard&Poor's Ratings Services will focus on the merged entity's strategy and financial policy, which have yet to be fully unveiled; whether the concessions offered by the two groups are accepted by the EU competition authorities; and whether the terms of the proposed merger, including an exceptional _1 billion special
