DUFF & PHELPS ASSIGNS RATING OF 'BBB-' TO THE WILLIAMS COMPANIES NORTHWEST PIPELINE RATED 'BBB'
CHICAGO, Feb. 2 /PRNewswire/ -- The Duff & Phelps Credit Rating Co. has assigned an initial public rating of 'BBB-' (Triple-B-Minus) to the senior debt of The Williams Companies. A rating of 'BB+' (Double-B-
Plus) has been assigned to Williams' preferred stock. About $1.2 billion of securities are affected. Additionally, the outstanding debentures of Northwest Pipeline Corp., a wholly-owned subsidiary, have been assigned a rating of 'BBB' (Triple-B). About $250.0 million of Northwest Pipeline securities are affected.
The rating reflects the long-term growth potential of the company's interstate pipeline and telecommunications operations. Since Northwest Pipeline already is principally a transporter of natural gas, its transition to a post-FERC Order 636 operating environment should be smooth. Williams Natural Gas should benefit under FERC Order 636 as the new rate structure lessens the company's sensitivity to weather. Williams Telecommunications (WilTel) has identified a niche in the long- distance telecommunications market. Expansion of the telecommunications business beyond this clearly defined niche strategy would be viewed with concern. The rating also reflects Williams' financial condition. Although the balance sheet improved in 1992, Duff & Phelps estimates that fixed obligations (including operating leases) were over 60 percent of total capitalization at the end of the year. Fixed charge coverage is estimated to have been less than 2.0 times for the year. In January 1993, Williams bolstered its financial condition by raising $96.7 million through the sale of units in the Williams Coal Seam Gas Royalty Trust. Despite the sale, only modest improvement in financial protection measures is expected over the next several years. The higher rating for Northwest Pipeline reflects its stronger financial profile and lower business risk relative to the other Williams' businesses. -0- 02/02/93 /CONTACT: David W. Eisinger of The Duff & Phelps Credit Rating Co., 312-368-3145/ (WMB)
CO: Williams Companies ST: Oklahoma IN: OIL SU: RTG
AH -- NY080 -- 1962 02/02/93 14:14 EST
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|Date:||Feb 2, 1993|
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