TAQA FY 2020 Proforma Consolidated Results and Dividend Policy
Favourable ratings outcome post-transaction
Improved business profile acknowledged through extraordinary upgrade of TAQA's standalone ratings
MOODY'S
Standalone ratings
baa1
Final ratings
Aa3 / Stable
TQɅ
Fitch Ratings
Standalone Ratings
bbb+
Final Ratings
AA- / Stable
6-notch upgrade
Highlights
Standalone ratings
b1
3-notch upgrade to AD
ratings less 1 notch
ノ
Final ratings
A3 / Stable
Obtained rare rating upgrade
during COVID-19
Almost unprecedented
3-notch upgrade (by Moody's)
7-notch upgrade
2-notch upgrade to AD
ratings less 1 notch
Standalone Ratings
'b' category
Final Ratings
A / Stable
Narrowed rating differential to Abu Dhabi
sovereign to only 1 notch
• Transaction significantly enhances asset portfolio by the addition of the
transmission and distribution assets to its generation assets and
creating a leading integrated utility in the Emirate of Abu Dhabi
• Higher ownership and strategic nature of TAQA operations strengthens
importance to Abu Dhabi
• The transfer of assets significantly improves TAQA's financial profile
through improved leverage metrics post transaction
[Moody's] consider the asset transfer as a form of financial support from the
government to TAQA because it will significantly improve its capitalisation
Given the highly strategic nature of these operations in an arid and harsh
desert climate, [Moody's] expect the government to continue to support
TAQA's operations.
Moody's 5 July 2020 Credit Opinion
• Asset transfers to TAQA improves its position in electricity generation
and water desalination, and secures a leadership position in the water
and electricity sector in Abu Dhabi
• TAQA to enjoy a pronounced importance to Abu Dhabi's electricity and
water markets, UAE Energy Strategy 2050, and its role in diversifying
the Emirates' generation towards renewables
• Maintains moderate level of leverage
Very Strong assessment of the support track record and expectations factor
is driven by consistent, timely and large-scale tangible support provided by
Abu Dhabi to TAQA upgrade is supported by the strengthening of the
links under Fitch Government-Related Entities Rating criteria between
TAQA and its majority indirect shareholder Abu Dhabi (AA/Stable).
Fitch 3 July 2020 Rating Action Commentary
9
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