Moody’s cuts Paragon Offshore, loans, notes

Moody's Investors Service said it downgraded Paragon Offshore plc's corporate family rating to Ca from Caa2, probability of default rating to Ca-PD from Caa2-PD, senior unsecured notes to C from Caa3, senior secured term loan to Caa2 from B3 and senior secured revolver to Caa2 from B3.

The outlook is negative and the SGL-4 speculative grade liquidity rating remains unchanged.

"Offshore drilling markets continue to experience severe stress and we expect Paragon to announce a formal debt restructuring plan in the near future to cope with diminishing revenue prospects, asset value, and debt service capacity,” Moody's assistant vice president and analyst Sajjad Alam said in a news release.

"The company is currently evaluating strategic alternatives, which will inflict steep principal losses to some of its lenders.”

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