S&P upgrades Archrock

S&P said it upgraded Archrock Partners LP to B+ from B, along with the rating on the senior unsecured debt to B+ from B- and revised the recovery rating to 4 from 5.

The partnership has issued $500 million of senior unsecured notes due 2027 to refinance the $350 million senior unsecured notes due 2021 and partially repay borrowings under the asset-based lending facility.

The agency also said it assigned a B+ rating and 4 recovery rating to the proposed debt, indicating 30% to 50% expected default recovery.

The company is expected to continue de-leveraging over the next several quarters.

S&P said it expects Archrock's debt-to-EBITDA ratio to generally remain in the 4x to 4.5x range over the next two years.

The stable outlook reflects an expectation for the partnership's utilization to remain about 90% over the next few years and the partnership to continue growing its total horsepower as demand for compression services remains stable, leading to continued growth in EBITDA, the agency explained.

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