Credit rating agency Maalot gave a Triple-A rating to NIS 1.6 billion in bonds government water utility Mekorot plans to issue next year to institutional investors on the local market. Mekorot has earmarked the cash to finance development plans and to repay long-term loans.
The agencies analysts say the rating primarily reflects the state ownership, regulatory support and positive government involvement expressed in water rates and the new spending agreement that reflect the company¿s proper expenses.
The rating also reflects the rather inflexible demand for water in most sectors, except in agriculture and gardening, stable growth in water demand and the lack of supply. Mekorot also benefits from limited competition and high entry thresholds, monopoly status ad from being the national water authority codified in the water and know-how law.