Fitch Places DPL & DP&L on Rating Watch Positive

Business Wire, Feb 14, 2005

NEW YORK -- Fitch Ratings has placed the ratings of DPL, Inc. (DPL) and Dayton Power and Light Company (DP&L) on Rating Watch Positive because of the positive credit implications anticipated to result from the sale of the private equity investment fund portfolio (see list of ratings below).

DPL's exit from the private equity business is expected to lower the company's business risk. In addition, a portion of the proceeds from the sale are likely to be used to reduce debt at the holding company level. Following progress on closure of the sales, clarity on the use of the sales proceeds and conclusion of a full rating review, Fitch anticipates upgrading the ratings of DPL to investment-grade levels and upgrading the ratings of DP&L to the 'A' category, assuming significant paydown of debt at the parent company is accomplished using the proceeds from the private equity portfolio.

DPL today announced that it entered into an agreement to sell its interests in 46 private equity funds to AlpInvest/Lexington 2004 LLC. The sale is expected to generate net pretax proceeds of $850 million, subject to adjustments for distributions and capital calls and consent to the transfer by the funds.

Fitch places the following on Rating Watch Positive:

DPL, Inc.

-- Senior unsecured debt 'BB';

-- Trust-preferred stock 'B ';

-- Short-term 'B'.

Dayton Power & Light

-- First-mortgage bonds 'BBB';

-- Collateralized PCRBs 'BBB';

-- Preferred stock 'BB ';

-- Short-term 'B'.