S&P may cut SandRidge notes

Standard & Poor's said it affirmed its B long-term corporate credit rating on SandRidge Energy Inc.

At the same time, the agency said it placed the B issue rating on the company's $4.3 billion of senior unsecured notes on CreditWatch with negative implications.

Upon completion of the transaction, the agency said it expects to lower the recovery rating on the notes to 5, resulting in the lowering of the issue rating to B-. A 5 recovery rating indicates an expectation of modest recovery for lender in the event of a default.

"The rating action follows the announcement that SandRidge plans to sell Permian Basin properties for approximately $2.6 billion," said S&P credit analyst Ben Tsocanos in a news release.

"The transaction materially reduces the company's reserves and production but increases its geographic concentration in the Mid-Continent Mississippian play and Gulf of Mexico shelf."

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