S&P affirms American Petroleum

Standard & Poor's said it affirmed its B- long-term corporate credit rating on American Petroleum Tankers LLC. The outlook is stable.

At the same time, S&P said it affirmed the B+ rating on the company's $285 million first-lien notes. The 1 recovery rating, indicating the expectation of a very high recovery in a payment default scenario, is unchanged.

"We are affirming our ratings on American Petroleum Tankers because we expect the company to maintain relatively stable revenues and earnings over the next year, benefiting from time-charter contract agreements with reputable counterparties," said S&P credit analyst Funmi Afonja in a news release.

"Although the company has greatly reduced its capital spending after completing its start-up vessel newbuild program, we expect the company's financial profile to remain highly leveraged because of the large debt it incurred to build its initial fleet and the accretion of the company's pay-in-kind subordinated debt,"Afonja said.

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