S&P cuts Sabine Oil, loans, notes

Standard & Poor's said it lowered its corporate credit rating on Sabine Oil & Gas Corp. to CCC from B-, issue-level rating on its senior secured credit facility to B- from B+, issue-level rating on its second-priority term loan to CCC- from CCC+ and issue-level rating on the senior unsecured notes to CC from CCC.

The 1 recovery rating on the senior secured notes, 5 recovery rating on the second-priority notes and 6 recovery rating on the senior unsecured notes are unchanged.

All ratings on Sabine remain on CreditWatch with negative implications.

"The downgrade reflects our view that Sabine may pursue capital restructuring over the next 12 months that could result in lower ratings on the company and its debt," S&P credit analyst Ben Tsocanos said in a news release.

Sabine disclosed in early March that it had borrowed the full $1 billion available amount of its credit facility. The agency expects that the facility lenders are likely to reduce the borrowing base in April below the level of loans outstanding because of lower commodity prices, resulting in a required payment and reduced liquidity.

S&P also noted that the facility matures in April 2016 and that the company may be challenged to extend the maturity.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.