TEXT-S&P: Envestra's capital plans support creditworthiness

(The following statement was released by the rating agency)

Aug 28 - Standard & Poor's Ratings Services today said that
its 'BBB-/A-3' corporate credit ratings and negative outlook on
Envestra Ltd. and Envestra's (ENV.AX) wholly owned subsidiary
Envestra Victoria Pty Ltd. (EnVic) were unchanged following
Envestra's announcement that it plans to raise A$100 million of
additional equity and reduce the level of its distributions for
the foreseeable future.

Envestra's capital-management initiatives will help to
support its creditworthiness and somewhat reduce the group's
near-term debt funding requirements. The announcement displays a
meaningful willingness by Envestra to reduce its reliance on debt
funding and moderate its aggressive financial profile to maintain
its credit ratings. Envestra's rating outlook will remain
negative until, at a minimum, the equity raising is successfully
completed. However, a revision of the outlook to stable will
likely require evidence of a steady and sustained improvement in
EnVic's credit quality and the group maintaining profitability
and financial flexibility consistent with the 'BBB-' rating
level.