S&P cuts, withdraws SAExploration

S&P said it lowered its corporate credit rating on SAExploration Holdings Inc. to CC from CCC-.

The outlook remains negative.

At the same time, the agency lowered the issue-level rating on the company's senior secured notes to CC from CCC-. The recovery rating on the notes remains 3, reflecting an expectation of meaningful (50% to 70%; lower half of the range) recovery in the event of a conventional default.

S&P said the downgrade follows SAExploration's announcement that it plans to launch an exchange offer to existing holders of its 10% senior secured notes for shares of common equity and a new issue of second-lien notes. Essentially, holders of the existing notes will receive on the closing date, $500 principal of new second-lien notes and common equity for every $1,000 principal amount of existing notes exchanged.

The exchange offer is scheduled to launch on or before June 20 and is anticipated to close no later than 30 days after the launch date.

The negative outlook reflects the expectation that S&P would lower the ratings if the company completes the exchange offer, the agency said.

Following the action, the agency withdrew the corporate credit and issue-level ratings at the company's request.

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