S&P puts Natural Resource on positive watch

S&P said it placed all of its ratings on Natural Resource Partners LP, including the B issuer credit rating, on CreditWatch with positive implications. The 4 recovery rating on the company's senior unsecured notes is unchanged, indicating an expectation for average (30%-50%; rounded estimate: 40%) recovery in the event of a payment default.

“The CreditWatch positive placement reflects our view that the proposed asset sale will improve NRP's adjusted debt leverage because we anticipate the company to use the net proceeds (and an additional $25 million of settlement proceeds from the Foresight litigation) to repay a portion of its outstanding debt,” S&P said in a news release.

“Pro forma for the transaction close, we expect the company's adjusted debt leverage could decline to about 3.8x by year-end 2019, compared with approximately 4.4x by year-end 2018.”

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