Moody’s changes Seadrill view to negative

Moody's Investors Service said it affirmed Seadrill Partners LLC's (SDLP) corporate family rating at Ba3, probability of default rating at Ba3-PD, the Ba3 rating on the $2.9 billion senior secured term loan due 2021, borrowed by Seadrill Operating LP and Seadrill Partners Finco LLC, subsidiaries of SDLP and the Baa3 rating on the $100 million first-out secured revolving credit facility due 2019, borrowed by Seadrill Operating, Seadrill Partners Finco and Seadrill Capricorn Holdings LLC, also a subsidiary of SDLP.

The outlooks on all ratings were revised to negative from stable.

"We revised Seadrill Partners LLC's outlook to negative to reflect increased risk from the cross default with its parent, Seadrill Ltd. (SDRL, unrated), which we expect is at risk of breaching covenants this year and which has a substantial funding requirement of over $3 billion next year if it is unable to significantly delay deliveries of its newbuild vessels currently under construction," Douglas Crawford, Moody’s vice president and lead analyst for Seadrill, said in a news release.

"We view SDRL's $11.6 billion contract backlog and industry leading, young fleet as favorable factors, but remain concerned that the weak offshore drilling environment increases the risk for Seadrill Ltd. to obtain financing for its extensive newbuild program or to reset its covenants."

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.