S&P ups W&T Offshore

S&P said it raised its issue-level rating on W&T Offshore Inc.'s second-lien term loan due 2020 and second-lien payment-in-kind toggle notes due 2020 to B- from CCC and revised the recovery rating on this debt to 1 from 3. The 1 recovery rating indicates an expectation of very high (90% to 100%; rounded estimate: 95%) recovery to creditors in the event of a payment default.

S&P also raised the issue-level rating on W&T's third-lien PIK toggle notes due 2021 to CCC- from CC and revised the recovery rating on this debt to 5 from 6. The 5 recovery rating indicates an expectation of modest (10% to 30%; rounded estimate: 25%) recovery to creditors in the event of a payment default.

Additionally, S&P affirmed the B- issue-level rating on the company's 1.5-lien term loan due 2019. The recovery rating on this debt is 1, indicating an expectation of very high (90% to 100%; rounded estimate: 95%) recovery to creditors in the event of a payment default.

S&P also affirmed the CC issue-level rating on the company's senior unsecured notes due 2019. The recovery rating on this debt is 6, indicating an expectation of negligible (0% to 10%; rounded estimate: 0%) recovery in the event of a payment default.

The CCC corporate credit rating and negative outlook on W&T Offshore Inc. are unchanged.

“The negative outlook reflects our view that W&T Offshore will likely enter into what we would view as a distressed exchange or capital restructuring within the next 12 months,” S&P said in a news release.

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