S&P lifts Memorial Resource

Standard & Poor’s said it raised the rating on Memorial Resource Development Corp.’s senior unsecured debt to B from B-.

The debt rating is the same as the company’s B corporate credit rating.

The agency also said it removed the rating from CreditWatch, where it was placed with negative implications Feb. 9.

S&P said it simultaneously revised the recovery rating on this debt to 4, indicating 30% to 50% expected default recovery, from 5.

The agency also said it affirmed the BB- rating on the company’s senior secured revolving credit facility and removed the rating from CreditWatch. The recovery rating on this debt remains at 1, indicating 90% to 100% expected default recovery.

The outlook is positive.

S&P also said it revised the recovery rating and raised the rating on the company’s senior unsecured debt based on an increase in the PV-10 valuation of the company’s reserves as of year-end 2015, resulting in higher recovery prospects for the senior unsecured debt.

The company’s business risk profile is considered vulnerable, the agency said, and its liquidity is considered adequate.

The positive outlook reflects the likelihood of an upgrade if the company successfully expands its reserves size and the percentage of proved developed reserves, S&P said.

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