Fitch assigns Holly Energy BB+

Fitch Ratings said it assigned a BB+ first-time long-term issuer default rating to Holly Energy Partners, LP. Fitch also assigned a senior unsecured rating of BB+/RR4. Holly's senior unsecured notes are co-issued by Holly Energy Finance Corp. and Fitch assigned its senior unsecured rating BB+/RR4.

“HEP's rating is supported by its stable cash flows that are largely supported by long-term minimum volume commitments (MVC) from its sponsor, HFC, which owns a 57% interest in HEP, including the 2% non-economic general partner interest,” Fitch said in a press release.

Credit concerns include the company's limited size and scale, lack of customer diversity and geographic concentration, Fitch said.

The outlook is negative and is attributed to the negative outlook for Holly Frontier Corp., which is Holly Energy’s largest counterparty.

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