S&P rates Gibson Energy notes BB

Standard & Poor's said it assigned its BB issue-level debt rating and 4 recovery rating to Gibson Energy ULC's proposed US$/C$750 million senior unsecured notes. Gibson is issuing the notes to repay all debt outstanding under its senior secured first-lien term loan facility and fund general corporate purposes.

The 4 recovery rating indicates an expectation of average recovery (30%-50%) in the event of default.

At the same time, S&P affirmed its BB long-term corporate credit and senior secured debt ratings on Gibson. The 3 recovery rating on the existing senior secured debt is unchanged and indicates an expectation of meaningful (50%-70%) recovery in a default. The outlook is stable.

"The ratings on Gibson reflect Standard & Poor's view of the company's fair business risk profile and 'significant' financial risk profile," said S&P credit analyst Gerry Hannochko in a news release.

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