Moody’s lowers Harvey Gulf, loans to B3

Moody's Investors Service said it downgraded Harvey Gulf International Marine Corp.'s (HGIM) corporate family rating to B3 from B2, probability of default rating to Caa1-PD from B3-PD and senior secured term and revolving credit facility rating to B3 from B2.

The speculative grade liquidity rating was affirmed at SGL-4 and the outlook remains negative.

"The one-notch downgrade of HGIM's CFR is mainly precipitated by the company's weak liquidity through 2016 and our view that the company's already elevated leverage could deteriorate further as the offshore sector's protracted downturn continues," Moody's senior analyst Sreedhar Kona said in a news release.

"The negative outlook, despite HGIM's strong contracted backlog, reflects the likely covenant breach in 2016 unless the company is able to amend its covenant requirements under the senior secured credit facility."

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