Moody’s gives Matador notes B2

Moody’s Investors Service said it assigned a B2 rating to Matador Resources Co.'s proposed issuance of $700 million senior notes due 2026.

Matador's other ratings, including its B1 corporate family rating, B1-PD probability of default rating and SGL-2 speculative grade liquidity rating, are unchanged.

The outlook is stable.

Matador will use part of the proceeds from the notes issuance to fund the 2023 notes tender offer and redeem any 2023 notes not tendered. The remainder of the proceeds will be used for 2018 capital spending.

"The proposed notes issuance is a leverage neutral transaction as we expect Matador to use part of the proceeds from the new notes issuance to offset the company's potential draw under the revolver to meet its 2018 capital outspend," Sreedhar Kona, Moody's senior analyst, said in a news release.

"Matador's equity issuance in May 2018 raised $227 million of proceeds, which mitigates the risk of excessive revolver draws and weakening credit metrics."

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