S&P gives B- to Shelf Drilling notes

S&P said it affirmed its B- long-term corporate credit rating on Dubai-headquartered oilfield services company Shelf Drilling Holdings Ltd. The outlook is stable.

In addition, S&P said it affirmed its B- issue rating on the company’s outstanding $30.4 million second-lien secured notes due 2018 and on the $503 million second-lien secured notes due 2020. The recovery rating remains 3, indicating an expectation of meaningful recovery (50%-70%; rounded estimate: 60%) in the event of a payment default.

Moreover, S&P said it affirmed the B rating on Shelf’s $160 million first-lien secured revolving credit facility due 2020. The recovery rating on the revolver remains 2, indicating an expectation of substantial recovery (70%-90%; rounded estimate: 85%) in the event of a payment default.

At the same time, S&P assigned a B- issue rating to the company's proposed $550 million senior unsecured notes due 2025. The recovery rating of the notes is 3, indicating an expectation of meaningful recovery (50%-70%; rounded estimate: 55%) in the event of a payment default.

“We believe that, upon completion of the refinancing, the company will be better positioned to overcome the tough market conditions, with negligible debt maturities in the coming years,” S&P said in a news release.

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