S&P: Allis-Chalmers view to stable

Standard & Poor's said it revised the outlook on Allis-Chalmers Energy Inc. to stable from negative. The agency also said it affirmed its B- corporate credit rating and B- issue-level ratings on its $255 million 9% senior notes due 2014 and the $250 million 8 ½% senior notes due 2017. The recovery ratings remain unchanged at 4, reflecting an expectation of 30% to 50% recovery in the event of default.

The change in outlook is due to expectations that conditions in the oilfield services sector have improved and that Allis-Chalmers' financial performance will likely strengthen over the course of 2010, S&P said.

The company also faces a decreased threat of violating its financial covenants as a result of recent amendments to its credit facility, the agency added.

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