Moody's downgrades ratings of "Electric Networks of Armenia" amid owner's arrest and nationalization plans
15.09.2025,
15:56
International rating agency Moody's has downgraded the long-term corporate rating (CFR) of Electric Networks of Armenia CJSC (ENA) from "Ba2" to "Ba3" and the probability of default rating (PDR) from "Ba2-PD" to "Ba3-PD".
YEREVAN, September 15. /ARKA/. International rating agency Moody's has downgraded the long-term corporate rating (CFR) of Electric Networks of Armenia CJSC (ENA) from "Ba2" to "Ba3" and the probability of default rating (PDR) from "Ba2-PD" to "Ba3-PD".
The outlook has been changed from "stable" to "negative", Interfax reports citing the agency's statement.
The ratings were previously under review with the possibility of a downgrade; now the rating action completes the review that began with respect to ENA on June 20, 2025.
The agency noted that the ratings were placed on Rating Watch Negative following reports of Armenian Prime Minister Nikol Pashinyan's proposal to nationalize the company and the arrest of ENA's owner, Tashir Group President Samvel Karapetyan.
"The downgrade reflects the company's increased exposure to state influence and regulatory risks as a result of legislative amendments adopted in July 2025 that allow the government to nationalize the company and the regulator to initiate certain administrative proceedings in certain cases," the agency said in a statement.
Moody's notes that the "Ba3" rating continues to take into account ENA's monopoly position in electricity distribution in Armenia, making it a critical infrastructure company in the country.
"Due to uncertainty about the impact of recent events on ENA's corporate governance, we have revised our Credit Impact Rating (CIR) to 'CIS-3' from 'CIS-2' to reflect the fact that while governance factors have limited impact on the current credit rating, they may have a more significant negative impact over time," the statement said.
The Negative Outlook reflects ongoing uncertainty about the development of the regulatory and business environment, including potential nationalization of the company, as well as the impact of recent events on ENA's governance, operations, investment program, financial policies, credit metrics, liquidity and access to international financing.
Given the Negative Outlook, ENA's ratings are unlikely to be upgraded over the next 12-18 months, Moody's said.
Samvel Karapetyan has been in custody since June 18 on charges of publicly calling for the seizure of power in Armenia. The day before, he declared his support for the Armenian Apostolic Church and Catholicos Garegin II amid attacks from the authorities.
After this, Armenian Prime Minister Nikol Pashinyan announced that the company-owned ENA would be nationalized and transferred to state control. On July 3, the parliament adopted amendments to the laws "On the Public Utilities Regulatory Authority" and "On Energy", allowing the nationalization of ENA.
On July 18, Romanos Petrosyan, who previously held the position of head of the State Control Service, became the interim manager of ENA.
The outlook has been changed from "stable" to "negative", Interfax reports citing the agency's statement.
The ratings were previously under review with the possibility of a downgrade; now the rating action completes the review that began with respect to ENA on June 20, 2025.
The agency noted that the ratings were placed on Rating Watch Negative following reports of Armenian Prime Minister Nikol Pashinyan's proposal to nationalize the company and the arrest of ENA's owner, Tashir Group President Samvel Karapetyan.
"The downgrade reflects the company's increased exposure to state influence and regulatory risks as a result of legislative amendments adopted in July 2025 that allow the government to nationalize the company and the regulator to initiate certain administrative proceedings in certain cases," the agency said in a statement.
Moody's notes that the "Ba3" rating continues to take into account ENA's monopoly position in electricity distribution in Armenia, making it a critical infrastructure company in the country.
"Due to uncertainty about the impact of recent events on ENA's corporate governance, we have revised our Credit Impact Rating (CIR) to 'CIS-3' from 'CIS-2' to reflect the fact that while governance factors have limited impact on the current credit rating, they may have a more significant negative impact over time," the statement said.
The Negative Outlook reflects ongoing uncertainty about the development of the regulatory and business environment, including potential nationalization of the company, as well as the impact of recent events on ENA's governance, operations, investment program, financial policies, credit metrics, liquidity and access to international financing.
Given the Negative Outlook, ENA's ratings are unlikely to be upgraded over the next 12-18 months, Moody's said.
Samvel Karapetyan has been in custody since June 18 on charges of publicly calling for the seizure of power in Armenia. The day before, he declared his support for the Armenian Apostolic Church and Catholicos Garegin II amid attacks from the authorities.
After this, Armenian Prime Minister Nikol Pashinyan announced that the company-owned ENA would be nationalized and transferred to state control. On July 3, the parliament adopted amendments to the laws "On the Public Utilities Regulatory Authority" and "On Energy", allowing the nationalization of ENA.
On July 18, Romanos Petrosyan, who previously held the position of head of the State Control Service, became the interim manager of ENA.
