Moody's may drop Pogo Producing

Moody's Investors Service said it placed Pogo Producing Co.'s ratings under review for downgrade upon its announced $750 million acquisition of private Latigo Petroleum, run by Randy Fouch with private equity funding from Warburg Pincus.

Pogo expects to fund the Latigo acquisition through cash on hand, asset sales, borrowings under its revolver and potential capital market transactions, the agency said, adding that Pogo currently has a Ba2 corporate family rating and a Ba3 senior subordinated note rating.

The review for downgrade is an extension of Moody's existing ongoing assessment of Pogo's operating profile, leverage and results as it continues to redefine its asset portfolio, the agency noted.

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