Moody’s downgrades CSI Compressco

Moody’s Investors Service said it downgraded CSI Compressco LP’s corporate family rating to Caa1 from B3 and its probability of default rating Ca-PD from B3-PD. Moody’s also downgraded Compressco’s senior secured first-lien notes rating to B3 from B1 and its senior unsecured notes rating to Caa3 from Caa2.

“The downgrade reflects the company’s intention to issue new secured debt to exchange for up to $252 million of its senior unsecured notes at a 25% to 30% discount to par, a transaction Moody’s views as a distressed exchange and thus, a default. Upon successful completion of the exchange, an ‘--/LD’ (limited default) signifier will be appended to Compressco’s PDR for a period of three days to acknowledge the default,” said Moody’s in a press release.

Moody’s changed the outlook to negative from stable. “The negative outlook reflects the steep challenges Compressco faces in its efforts to limit utilization and pricing declines and the potential that a continuation of very low oil prices into 2021 could further erode the company’s credit profile,” the agency said.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.