Moody’s trims McDermott, ratings on review

Moody’s Investors Service said it lowered McDermott Technology (Americas), Inc.’s corporate family rating to B3 from B2, its probability of default rating to B3-PD from B2-PD, its senior secured credit facilities rating to B2 from B1, and its senior unsecured notes rating to Caa2 from Caa1, and placed all ratings under review for possible further downgrade. McDermott’s speculative grade liquidity rating of SGL-3 is unchanged.

“The downgrade and review of McDermott’s ratings reflects the hiring of advisors to evaluate strategic options in light of the higher than expected costs and cash outflows on a few problem projects and the lower than expected proceeds from asset sales. These factors have led to higher debt levels, weaker credit metrics and tighter near-term liquidity than previously expected,” said Michael Corelli, a Moody’s vice president, senior credit officer and lead analyst for McDermott Technology (Americas), in a news release.

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