Moody's rates Crestwood Midstream notes B1

Moody's Investors Service said it assigned a B1 rating to Crestwood Midstream Partners LP's proposed $500 million senior unsecured notes due 2022.

The outlook is stable.

Use of proceeds will go toward partial funding of the recently announced acquisition of Arrow Midstream Holdings, LLC as well as repaying outstanding revolver borrowings.

The B1 rating on the company's senior unsecured notes reflects both the overall Ba3-PD probability of default of Crestwood, and a loss given default of LGD 4 (68%).

Crestwood has a $1 billion senior secured revolving credit facility. The size of the potential priority claim to the assets at Crestwood relative to the senior unsecured debt outstanding results in the unsecured debt being rated one notch beneath the Ba3 corporate family rating under Moody's Loss Given Default Methodology.

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