Moody’s downgrades Shelf Drilling, loan, notes

Moody's Investors Service said it took a number of rating actions on Shelf Drilling Midco, Ltd. (Midco) and Shelf Drilling Holdings, Ltd. (Holdings).

The agency downgraded Midco's corporate family rating to B2 from B1, probability of default rating to B2-PD from B1-PD and senior secured term loan rating to B3 from B2.

At the same time, Moody's downgraded Holdings' senior secured notes rating to B2 from B1.

The outlook was changed to stable. This concludes the rating review that was initiated on Jan. 22.

"Today's downgrade is driven by the increased business risk and volatility in the oilfield services sector globally, and the drilling segment more specifically resulting in significant pressure on utilization and day rates," Moody's analyst Julien Haddad said in a news release.

"The stable outlook reflects Shelf Drilling's strong competitive position in the markets it operates, and its ability to absorb volatile and lower utilization and day rates over the next 18 to 24 months."

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