TEXT-Moody's: Eesti energia's outlook now negative

(The following statement was released by the rating agency)

EUR300 Million of Debt Affected.

Nov 10 - Moody's Investors Service has today changed to negative from
stable the outlook on the A1 long-term senior unsecured issuer and debt rating
of Eesti Energia AS ("Eesti Energia"), following an earlier decision by Moody's
to change the outlook to negative from stable on Estonia's A1 foreign currency
and bond ratings.
In accordance with Moody's Government Related Issuer ("GRI") rating
methodology, the rating of Eesti Energia reflects the combination of the
following inputs:
- Baseline credit assessment of 8 (on a scale of 1 to 21, where 1 represents
the lowest risk and 8 is equivalent to Baa1)
- A1 local currency rating of the Estonian government
- High dependence
- High support
Moody's assessments of Eesti Energia's baseline credit risk and government
support remain unchanged at this stage. The rating action therefore solely
reflects the impact of the sovereign ratings action, as applied through Moody's
GRI rating methodology. In light of the ongoing global financial crisis,
Moody's has reassessed the level of default dependence for Eesti Energia from
medium to high, reflecting Eesti Energia's significant exposure to the Estonian
economy and high level of external debt.
Moody's last rating action from 13 September 2007 changed the outlook on Eesti
Energia's issuer rating to stable from positive following the Moody's decision
to change outlook on Estonia's A1 local currency rating to stable from
positive.
Based in Tallinn, Estonia, Eesti Energia is the country's 100% state-owned
vertically integrated utility. For the fiscal year ending March 2008, it
recorded revenues of EUR574 million.
(New York Ratings Team)