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S&P ups SemGroup, Hfotco
S&P said it upgraded the ratings of SemGroup Corp. and Hfotco LLC to BBB- on their acquisition by Energy Transfer LP. The agency also removed the ratings from CreditWatch with positive implications.
Energy Transfer redeemed SemGroup’s notes due 2025 and 2026 and terminated its revolver. The partnership also repaid Hfotco’s $592 million term loan. S&P withdrew Hfotco’s ratings at Energy Transfer’s request.
All SemGroup’s assets have been merged into Energy Transfer Operating LP, and S&P said it considers SemGroup to be a core asset for Energy Transfer.
“We expect ET’s pro forma consolidated leverage to be about 4.5x in 2019 and about 4.7x in 2020 before improving to the 4.3x-4.5x range in 2021. We also believe ET will successfully integrate SEMG into the larger Energy Transfer complex and optimize its asset portfolio during the 12-18 months after close,” said S&P in a press release.
The outlook is stable.
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