S&P: Ocean Rig Norway view developing

Standard & Poor's said it affirmed Ocean Rig Norway AS' B long-term corporate credit rating and removed it from CreditWatch, where it was placed with positive implications on April 23.

The outlook is developing.

The rating was originally placed on CreditWatch after DryShips Inc. began to increase its stake in the company. The CreditWatch placement was based on S&P's expectation that Ocean Rig might be integrated into DryShips, creating a larger and more diversified shipping operation.

The agency said the removal from CreditWatch and the developing outlook reflect uncertainty created by a recent announcement that DryShips intends to spin off Ocean Rig as a separate company and list it in the United States. Even though S&P expects Ocean Rig's management to remain in position, the agency said this announcement creates uncertainty about future ownership, strategy and financial policy that ultimately could lead to a one-notch downgrade.

Conversely, DryShips has two drill-ships under construction. These may be included in the new group, creating some upside potential for the rating, S&P said.

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