Moody’s downgrades ENA ratings amid owner’s arrest and nationalization plans

Moody’s Ratings has downgraded Electric Networks of Armenia’s (ENA) long-term corporate family rating (CFR) to Ba3 from Ba2 and its probability of default rating (PDR) to Ba3-PD from Ba2-PD. The outlook has also been revised from “stable” to “negative.”

Previously, the ratings were on review for downgrade. This action concludes the review regarding ENA initiated on June 20, 2025.

Moody’s had earlier placed ENA on its Rating Watch Negative list following reports that Armenian Prime Minister Nikol Pashinyan proposed nationalizing the company and that ENA’s owner—Samvel Karapetyan, a Russian businessman of Armenian origin and president of the Tashir Group—had been arrested.

“Today’s downgrade of ENA’s ratings reflects the company’s heightened susceptibility to government influence and regulatory risks resulting from the adoption of legislative amendments in July 2025 enabling the government to nationalize the company and the regulator to initiate certain administrative proceedings in certain cases,” the statement reads.

Moody’s notes that the Ba3 rating still reflects ENA’s monopoly in electricity distribution in Armenia, making it a critically important infrastructure company in the country.

“Because of the uncertainty over the impact of recent developments on ENA’s governance, we changed the company’s credit impact score to CIS-3 from CIS-2 to reflect that while governance considerations have a limited impact on the current credit rating, they have potential for greater negative impact over time,” the statement adds.

The negative outlook reflects the continuing uncertainty over the evolution of the regulatory and business environment, including potential nationalization, and the impact of recent developments on ENA’s governance, operations, investment program, financial policies, credit metrics, liquidity and access to international funding.

“ENA’s ratings are unlikely to be upgraded over the next 12-18 months given the negative outlook,” Moody’s concludes.