Fitch Ratings on April 15 lowered DTE Energy Co.'s long-term issuer default rating to BBB from BBB+, citing the higher leverage and business risk associated with its $2.65 acquisition of a midstream pipeline and gathering system in Louisiana's Haynesville Shale.

Fitch also removed the company from rating watch negative, replacing it with a stable outlook.

DTE completed the acquisition of the assets from Momentum Midstream LLC and Indigo Natural Resources LLC on Dec. 4, 2019.

"The company's growth in the midstream assets via acquisition, including Haynesville assets, the Link pipeline assets in 2016, and construction of NEXUS pipeline, indicates management strategy to grow this riskier segment to keep pace with the utility's strong growth, while raising consolidated leverage for a couple of years following each transaction," the rating agency said in a research note.

On its February earnings call, DTE CEO and President Jerry Norcia said the company continues to expect growth from gas assets despite a low price environment.

Fitch affirmed the short-term issuer default rating of DTE Energy at F2, the long-term issuer default ratings of DTE Electric Co. at A- and DTE Gas Co. at BBB+.