S&P gives B to American Midstream, notes

S&P said it assigned its B corporate credit rating to American Midstream Partners LP.

The outlook is stable.

The agency also assigned its B issue-level rating and 3 recovery rating to American Midstream's $300 million senior unsecured notes due 2024. The 3 recovery rating indicates that lenders can expect meaningful (50% to 70%; higher half of the range) recovery in the event of a payment default.

"The stable outlook reflects our expectation that American Midstream Partners (on a pro forma basis merged with JPEP) will maintain debt to EBITDA of about 5x (including preferred equity classified as debt) and distribution coverage of about 1.2x in 2017," S&P credit analyst Stephen Scovotti said in a news release.

"We also expect the company to maintain liquidity we view to be adequate. We expect the company to continue to be acquisitive, through dropdowns and third-party acquisitions, and expect it to fund any future acquisitions in a balanced manner using debt and equity."

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