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ENSERCH 7 PERCENT NOTES DUE 1999 RATED 'BBB' BY FITCH -- FITCH FINANCIAL WIRE --

 ENSERCH 7 PERCENT NOTES DUE 1999 RATED 'BBB' BY FITCH
 -- FITCH FINANCIAL WIRE --
 NEW YORK, Aug. 12 /PRNewswire/ -- ENSERCH Corp.'s $150 million 7 percent notes due Aug. 15, 1999, are rated "BBB" by Fitch. This issue was offered pursuant to a Rule 415 registration, of which $150 million of the original $500 million remains unsold. ENSERCH will use the proceeds to redeem its $125 million of 11 3/8 percent notes due 1995 and the remaining $20 million of 10 percent convertible subordinated debentures due 2001.
 Outstanding ratings are affirmed as follows: "BBB" senior debt, convertible subordinated debt and adjustable rate preferred shares at "BBB-", and commercial paper at "F-2". The credit trend is stable.
 The company's financial performance remains weak, as evidenced by thin credit protection measurements and debt leverage which is aggressive given the risks inherent in the company's businesses.
 With deteriorating gas prices and an evolving regulatory environment, management took actions to adapt the business to these changes. It divested several non-strategic assets and refocused the enterprise into three core businesses. The company used asset sales proceeds to reduce debt, conserved cash, and trimmed dividends and capital spending to fit lower cash flows. However, charges associated with some asset value restructurings eroded the equity base, allowing no progress in leverage reduction. However, the company's interest costs will benefit from debt refinancings, which, when completed, will have eliminated all double-digit coupons.
 The price of domestic natural gas is the single most important determinant of the company's earnings and cash flow performance. While prices have improved substantially from their early 1992 lows, their sustainability at current levels over the near term is uncertain. Until its cash flows advance further, ENSERCH remains capital-constrained, and capital expenditures could be insufficient to replace reserves during this period of restraint. Nonetheless, with its restructuring essentially completed, Fitch expects the company's credit profile to stabilize over the near term.
 ENSERCH Corp., headquartered in Dallas, is a diversified energy company, engaged in exploration and production, natural gas transmission and distribution, and engineering and construction through EBASCO Services.
 -0- 8/12/92
 /CONTACT: Mary Anne Sudol, CFA of Fitch, 212-908-0562/
 (ENS) CO: ENSERCH Corp. ST: Texas IN: OIL SU: RTG


TS -- NY048 -- 9356 08/12/92 12:02 EDT
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Publication:PR Newswire
Date:Aug 12, 1992
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