Pashinian pledged to “quickly” nationalize Electric Networks of Armenia (ENA) on June 18 hours after the company’s owner, billionaire Samvel Karapetian, was arrested following his strong criticism of the premier’s campaign against the Armenian Apostolic Church. Karapetian’s Tashir Group launched arbitration proceedings in Stockholm later in July as the government began enforcing a hastily enacted law allowing it to take over ENA’s management before nationalizing the electric utility.
In a weekend statement, Moody’s announced that it has cut ENA’s long-term corporate family rating (CFR) to Ba3 from Ba2 and its probability of default rating (PDR) to Ba3-PD from Ba2-PD. It also downgraded the company’s outlook to “negative.”
“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,” read the statement.
The amendments, it said, “indicate ENA's increased exposure to event risks related to the regulatory and business environment.”
“As a result, we no longer view the company's rating to be appropriately positioned higher than the sovereign rating of the Government of Armenia (Ba3 stable),” added Moody’s.
Armenia - National Security Service officers raid the headquarters of Electric Networks of Armenia in Yerevan, July 8, 2025.
Tashir is seeking $500 million in damages for what it calls an illegal “expropriation” of its biggest asset in Armenia. In an interim win for Karapetian’s conglomerate headquartered in Moscow, the Arbitration Institute of the Stockholm Chamber of Commerce (SCC) ordered the Armenian authorities in July to refrain from seizing ENA or changing its top management pending a verdict in the case. The authorities ignored the order, refusing to reverse their decisions to replace the top company executives.
Tashir has dismissed government allegations that it has mismanaged Armenia’s electricity distribution network, saying that they are part of Pashinian’s politically motivated crackdown on Karapetian. The latter pledged to set up a new opposition group and fight for regime change following his arrest.
Moody’s said ENA’s “financial profile” has been strong “despite significant debt-funded investments and recently commenced dividend payouts.” The agency also noted that it began reviewing the utility’s ratings on June 20, two days after the tycoon’s arrest.
Critics of the Armenian government view the seizure of ENA as a serious blow to Armenia’s business reputation. They say it will scare away major foreign investors who have already shown little interest in the South Caucasus nation during Pashinian’s seven-year rule.