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Fitch upgrades AES after restructuring Chilean hydro project

Fitch Ratings on May 17 raised its long-term issuer default rating on AES Corp. to BB+ from BB, following the completion of financial restructuring at its 531-MW Alto Maipo hydro project in Chile in May.

The rating agency also revised its outlook to stable from positive and affirmed AES' senior unsecured rating at BB+/RR3 and senior secured rating at BBB-/RR1.

"Fitch believes that the restructuring and the new fixed-price lump sum contract have largely mitigated construction risk and removed material uncertainties associated with AES Gener SA and AES' financial obligations," the rating agency said.

Aside from the completed financial restructuring, Fitch cited the company's continued execution of its deleveraging plan, its improving credit metrics, increasing renewable assets in its portfolio and the tax reform impact as key rating drivers.