EPH Infrastructure Gets Credit Ratings

EPH Infrastructure (Epif), a joint venture of Czech holding EPH and Macquarie Infrastructure and Real Assets (Mira), said March 13 it had been issued ratings by three credit rating agencies.

Epif assets are mainly in Slovakia (where it has a 49% operating stake in the gas transit pipeline Eustream, alongside the state on 51%) and the Czech Republic. Its business segments cover gas transmission, gas and power distribution, heat infrastructure, and gas storage.

The new ratings issued are as follows: S&P (Preliminary BBB), Moody's (Baa3) and Fitch (BBB-), all with a stable outlook. Epif reported 2016 pre-tax earnings (Ebitda) of 1.4bn euros.

Epif is 69%-owned by EPH (an energy supplier and generator majority-owned by Czech investor Daniel Kretinsky) and since February 2017 31% by a consortium of global institutional investors managed by Mira. Neither side disclosed the price paid by Mira for its stake.

Russian gas entering the EU from the Ukrainian border passes through Eustream on its way to the Czech Republic and Germany, which Moody's said it was expected to remain an important route for at least "the next three to five years." Other core businesses are SPP-distribucia, the monopoly provider of gas distribution services in Slovakia, benefiting from cash flows generated under a relatively stable regulatory regime; and Stredoslovenska Energetika, the second largest of three main electricity distribution networks in Slovakia.

Epif part-owns gas distribution interests in the Czech Republic through a separate joint venture, RWE Grid Holding. However the Czech Republic's main gas transmission operator Net4Gas is a 50%-50% joint venture of rival funds operated by Germany's Allianz Capital Partners and Omers, one of Canada’s largest pension funds.

Macquarie's Mira is also leader of a consortium, including Chinese and Qatari sovereign wealth funds, that since 2017 has owned a 61% interest in Cadent, the former gas distribution business in Britain of National Grid.