Calpine Debt Rating Cut Two Notches
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Fitch Ratings on Monday downgraded $9.3 billion of Calpine Corp. debt two notches, pushing the troubled power generator deeper into junk territory on concerns about the San Jose company’s heavy debt load in the face of continued weak electricity prices.
At the same time, the Wall Street credit rating firm said the outlook for Calpine’s rating is “stable.” Calpine stock slipped 12 cents, or 3.4%, to $3.37 on the New York Stock Exchange.
Fitch cut Calpine’s senior unsecured debt rating to B-plus from BB. Calpine’s outstanding convertible trust preferred securities were lowered to B-minus from B.
All of the ratings are below investment grade.
The downgrade does not trigger any debt defaults or otherwise affect company operations, Calpine spokeswoman Katherine Potter said.
Calpine and other companies that generate power and trade electricity have been hit hard by depressed electricity prices and tight credit.
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