S&P raises Vesta

S&P said it raised Vesta Energy Corp.’s issuer rating to CCC+ from CCC and its senior unsecured notes to B- from CCC+. The agency also removed all its Vesta ratings from CreditWatch with positive implications, where they were placed on Oct. 14.

“The successful completion of the exchange offer alleviates near-term refinancing risk. Vesta has announced completion of its exchange offer and indicated that approximately 98.8% of the principal amount of the existing notes (C$200 million, 8 1/8% notes due July 2023) had been tendered. In our view, the transaction has effectively extended the maturity for its notes outstanding to October 2026, with the modest remaining balance (about C$2.5 million) expected to be repaid in July 2022, when the notes are callable at par,” S&P said in a press release.

The agency said forecasts Vesta will deliver meaningfully improved cash flows in 2022, which also underpins the upgrade. Oil prices are trading at seven year highs.

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