DBRS Confirms 407 East Development Group General Partnership at A (low), Stable Trend

In light of today’s rating action on SNC-Lavalin Group Inc. (SNC), DBRS wishes to clarify its position regarding 407 East Development Group General Partnership (ProjectCo), whose ratings DBRS has today confirmed at A (low). The trend remains Stable.

DBRS notes that in certain circumstances, an adverse rating action at the parent guarantor level would not be mirrored in the rating of the project. Some projects may carry security packages notably in excess of that required for the rating during construction. Where there is sufficient excess performance security in the project, DBRS may choose not to take rating action. As such, despite the change in the trend of SNC to Negative earlier today, ProjectCo’s construction security package, including a 10% (ratings dependent) letter of credit, would allow the project to absorb a potential one-notch downgrade in the rating of SNC.

Notes:
All figures are in Canadian dollars unless otherwise noted.

The related regulatory disclosures pursuant to the National Instrument 25-101 Designated Rating Organizations are hereby incorporated by reference and can be found by clicking on the link to the right under Related Research or by contacting us at info@dbrs.com.

This rating is endorsed by DBRS Ratings Limited for use in the European Union.

The applicable methodology is Rating Public-Private Partnerships, which can be found on our website under Methodologies.