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NORTHERN ILLINOIS GAS $75 MILLION FIRST MORTGAGE BONDS RATED 'AA+' BY FITCH -- FITCH FINANCIAL WIRE --

 NEW YORK, Feb. 3 /PRNewswire/ -- Northern Illinois Gas Co.'s (NI-Gas) pending shelf registration takedown of $75 million first mortgage bonds is rated AA+' by Fitch. Outstanding first mortgage bonds are affirmed at AA+'. The credit trend is stable.
 These rating for NI-Gas stems from a stable and broadly diversified natural gas customer base in the utility operations, a conservative balance sheet, high quality of earnings, and predictable cash flows and coverages.
 In spite of mild heating-season weather and economic recession, NI-Gas' operating and financial fundamentals held up exceptionally well during 1990, 1991 and the first 9 months of 1992. Indicators measuring the company's credit quality are expected to remain strong.
 Pretax interest coverage declined from an exceptional 5-times(x) level during the mid- and late-1980s to better than 4x recently. During 1993 and beyond pretax coverage should comfortably exceed 4x. Internal cash generation of capital expenditure requirements rose from approximately 75 percent in 1988 to a plateau of 83-85 percent in recent years. Prospective figures are likely to approximate or exceed 100 percent.
 Long-term debt to capital has consistently remained in the 33 percent-38 percent range since the mid-1980s; numbers in the range of 38 percent-42 percent are probable during the next several years. Total debt, including intra-year seasonal borrowings, has regularly peaked at around 50 percent of overall year-end capitalization, with temporary heating-season borrowing paid off completely each spring. These patterns are expected to recur in future years, given seasonal borrowing needs and manageable capital spending programs.
 -0- 2/3/93
 /CONTACT: William Stellenwerf of Fitch, 212-908-0558/


CO: Northern Illinois Gas Co. ST: Illinois IN: UTI SU: RTG

SM -- NY047 -- 2368 02/03/93 11:56 EST
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Publication:PR Newswire
Date:Feb 3, 1993
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