S&P ups Savanna Energy debt to BB-

S&P said it revised its outlook on Savanna Energy Services Corp. to negative from stable and affirmed its B+ long-term corporate credit rating.

At the same time, the agency raised its issue-level rating on the company's senior unsecured debt to BB- from B+ and revised the recovery rating to 2 from 4. The recovery rating indicates an expectation of substantial (70%-90%; at the higher end of the range) recovery for senior unsecured debtholders under our simulated default scenario.

"Given the significant deterioration of the company's cash flow metrics, we believe there is some risk that Savanna's financial risk profile could remain below the levels necessary to support the B+ rating," S&P credit analyst Michelle Dathorne said in a news release.

"The recovery rating revision reflects the improved recovery prospects for unsecured debtholders."

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