Moody's rates SemGroup

Moody's Investors Service said it assigned a B1 corporate family rating to SemGroup Corp., along with a B2 probability of default rating and a B1 senior secured debt rating to its proposed $650 million credit facility.

A speculative grade liquidity rating of SGL-2 also was assigned.

The outlook is negative due to the uncertainty created by the company's consideration of the formation of a master limited partnership to own some or all of the company's assets, Moody's said.

The ratings are based on the company's current organizational structure, the agency said.

The ratings also consider its diversified earnings mix, small scale and conservative leverage ratio, Moody's said.

The ratings are vulnerable to a downgrade should the company reorganize using a MLP structure due to the equity distributions that would be paid out, the agency said, as well as the likelihood that structurally superior debt would be incurred within the MLP.

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