S&P affirms Ocean Rig

Standard & Poor's said it affirmed its B long-term corporate credit rating on Ocean Rig UDW Inc. The outlook is negative.

At the same time, S&P assigned an issue rating of CCC+ to the proposed $500 million senior unsecured notes due in 2019 to be issued by Ocean Rig. The recovery rating on these notes is 6, indicating an expectation of negligible (0%-10%) recovery prospects in the event of a payment default.

S&P said it understands that the proceeds of these notes will be used to repay the existing $500 million senior unsecured notes that currently have an issue rating of CCC+ and a recovery rating of 6.

The affirmation follows the announced tender offer for the 9½% senior unsecured callable notes due 2016 and reflects S&P's assessment of Ocean Rig's anchor at b, based on S&P's assessments of the company's business risk profile as "fair" and financial risk profile as "highly leveraged."

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