Buenos Aires, December 21, 2010 -- Moody's Latin America (Moody's) has rated the Debt Securities and Certificates
issued under Fideicomiso Financiero Albanesi Gas Clase 02, by Equity
Trust Company (Argentina) S.A., acting solely in its
capacity as issuer and trustee.
ARS 74,900,000 in Class A Debt Securities of "Fideicomiso
Financiero Albanesi Gas Clase 02", rated Aa3.ar (sf) (Argentine
National Scale) and B2 (sf) (Global Scale, Local Currency)
ARS 27,572,930 in Certificates of "Fideicomiso Financiero
Albanesi Gas Clase 02", rated Ca.ar (sf) (Argentine National
Scale) and Ca (sf) (Global Scale, Local Currency)
RATING RATIONALE
The ratings are based on the following factors:
- The credit enhancement provided through an initial overcollateralization
of approximately 26.9%.
- The partial mitigation of the regulatory risks when compared
to other similar transactions issued in the Argentine market.
- The absence of construction risk, as the construction of
the pipelines corresponding to this transaction has been finalized.
- The ability of Rafael G. Albanesi S.A. (RGA)
to act as the technical operator in the transaction, provide the
gas transportation capacity on an ongoing basis and suspend the gas transportation
service if carriers default.
- The mitigation of commingling risk as the carriers will be paying
directly into the trust account.
- The structural protections of the transaction, such as
a turbo sequential payment structure and the availability of various reserve
accounts, including a fixed-amount expense reserve fund and
a liquidity reserve fund equivalent to the next interest payment on the
Class A securities.
RGA, a gas and electricity broker located in Buenos Aires,
Argentina, entered into take-or-pay gas transmission
agreements (Ofertas de Servicio de Transporte Firme) with industrial companies
located in Argentina (the carriers), which are also clients of RGA.
Under these agreements, the carriers receive gas transportation
capacity and are obliged to make certain fixed payments on a monthly basis
("Amortization"), which are the main underlying assets
that back the repayment of the rated debt.
Class A will bear a floating interest rate of BADLAR plus 549 basis points,
with a minimum of 16.5% and a maximum of 24%.
Class A will have monthly principal amortizations.
The credit enhancement in this transaction is provided mainly through
overcollateralization (OC). The initial OC for the benefit of Class
A holders is of approximately 26.90% resulting from discounting
the fixed cashflow owned by the trust using an annual discount rate of
25%, which has been defined in the transaction's documents.
The transaction has a turbo sequential payment structure and no interest
or principal will be paid to the subordinated Certificates until the Class
A is paid in full.
The transaction will also benefit from a liquidity reserve fund equivalent
to the next interest payment on the Class A securities.
The gas industry in Argentina is highly regulated. The Argentine
Government -through ENARGAS, the gas industry regulator-
has the authority to determine gas transmission and distribution systems,
prices, required investments and fundamentally the gas charges that
were established to repay infrastructure projects.
Although the underlying assets in this transaction are not the gas charges
established by ENARGAS but the repayment of the advances on the above
mentioned gas charges made by RGA, Moody's believes that there
is a risk that changes in the regulatory framework of the gas industry
in Argentina could affect this transaction.
Moody's evaluated the sufficiency of the credit enhancement by stressing
the cashflows under several scenarios, including the default of
the carriers. In the cashflow model, the carriers will default
based on their current (or estimated) rating levels. Moody's
assumed that defaulting carriers in the pool would not be substituted
with another carrier. The model applies a haircut to the future
payments from the carriers based on their current rating level.
Moody's run a Montecarlo simulation with 10,000 iterations
to determine the expected loss for each of the rated tranches.
The factors that could lead to a downgrade of the transaction include:
changes to the regulatory and legal framework of the gas industry in Argentina
that could affect the underlying assets, an increase of the defaults
of the carriers over Moody's expectations, and a decline in
the credit quality of RGA.
However, Moody's believes that the dependence of the transaction
on RGA's performance is mitigated by the following factors:
(i) first, obligors have been notified to pay directly into the
trust account; as a result, there is no commingling of funds
with funds in RGA accounts, (ii) second, the role of RGA is
limited to dispatch and order the gas transportation capacity, and
(iii) RGA's role could be assumed by a different company in the
future.
The main source of uncertainty for this transaction is the regulatory
and legal framework for the gas industry in Argentina. As discussed
above, ENARGAS determines the gas charges that were established
to repay infrastructure projects. Although the underlying receivables
backing the rated debt are not the gas charges themselves but the repayment
of the advances on the gas charges made by RGA, there is a risk
that changes in the regulatory framework could affect this transaction.
Moody's publishes a weekly summary of structured finance credit,
ratings and methodologies, available to all registered users of
our website, at www.moodys.com/SFQuickCheck.
Moody's did not receive or take into account a third party due diligence
report on the underlying assets or financial instruments in this transaction.
REGULATORY DISCLOSURES
Information sources used to prepare the credit rating are the following:
parties involved in the ratings and public information.
Moody's Investors Service considers the quality of information available
on the issuer or obligation satisfactory for the purposes of assigning
a credit rating.
Moody's adopts all necessary measures so that the information it uses
in assigning a credit rating is of sufficient quality and from sources
Moody's considers to be reliable including, when appropriate,
independent third-party sources. However, Moody's
is not an auditor and cannot in every instance independently verify or
validate information received in the rating process.
Please see ratings tab on the issuer/entity page on Moodys.com
for the last rating action and the rating history.
The date on which some Credit Ratings were first released goes back to
a time before Moody's Investors Service's Credit Ratings were fully digitized
and accurate data may not be available. Consequently, Moody's
Investors Service provides a date that it believes is the most reliable
and accurate based on the information that is available to it.
Please see the ratings disclosure page on our website www.moodys.com
for further information.
Please see the Credit Policy page on Moodys.com for the methodologies
used in determining ratings, further information on the meaning
of each rating category and the definition of default and recovery.
Buenos Aires
Martin Fernandez Romero
Vice President - Senior Analyst
Structured Finance Group
Moody's Latin America, Calificadora de Riesgo
JOURNALISTS: (800) 666 -3506
SUBSCRIBERS: (5411) 4816-2332
New York
Maria Muller
Senior Vice President
Structured Finance Group
Moody's Investors Service
JOURNALISTS: 212-553-0376
SUBSCRIBERS: 212-553-1653
Moody's Latin America, Calificadora de Riesgo
Cerrito 1186, 11th fl
Buenos Aires C1010AAX
Argentina
JOURNALISTS: (800) 666 -3506
SUBSCRIBERS: (5411) 4816-2332
Moody's rates Fideicomiso Financiero Albanesi Gas Clase 02 in Argentina
