Fitch Ratings Upgrades Electricidad de Caracas to 'B+'.

CHICAGO -- Fitch Ratings has upgraded the senior unsecured foreign currency rating of C.A. La Electricidad de Caracas (EDC) to 'B+' from 'B-' and its senior unsecured local currency rating to 'BB-' from 'B'. The Stable Rating Outlook has been maintained.

The rating action follows Fitch's upgrade of the Bolivarian Republic of Venezuela's long-term foreign currency rating to 'B+' from 'B-' and its long-term local currency (Venezuelan bolivar) rating to 'B+' from 'B-'. The sovereign actions reflect Venezuela's improved credit profile following the resolution of uncertainty related to the August presidential recall referendum, as well as higher international liquidity.

EDC has effectively managed several issues despite facing severe economic and political volatility during 2003 and 2004, which has illustrated the company's ability to partially mitigate these risks. The ratings of EDC reflect the company's position as the largest private electric utility company in Venezuela and as a low-cost, vertically integrated company. EDC's long history as a profitable, reliable private entity helps provide comfort in the company's and management's ability and willingness to meet its financial obligations in the event of material adverse events. The ratings also incorporate the many adverse economic and political challenges that have pressured the credit quality of the company and Venezuelan sovereign alike. The improvement in the sovereign rating has eased the rating constraints on EDC, allowing for the ratings upgrade toward levels more reflective of the company's financial condition.

EDC is the largest private-sector electric utility in Venezuela and generates, transmits, distributes, and markets electricity primarily to metropolitan Caracas and its surrounding areas. The AES Corporation owns 86% of EDC and acquired its stake in June 2000 through a public-tender offer.