Fitch gives Seplat notes B-

Fitch Ratings said it gave Seplat Petroleum Development Co. plc's upcoming senior notes an expected senior unsecured rating of B-. The recovery rating is RR4.

The new senior notes will benefit from the same guaranty package from Seplat West Ltd., Newton Energy Ltd. and Seplat East Swamp Ltd. as Seplat's $350 million of 9¼% senior notes due in 2023.

“The new notes will be subordinated to the company's $350 million senior secured revolving credit facility (RCF) due at end-2023 (following a successful refinancing of the senior notes) that benefits from a pledge over the shares of Seplat West Ltd and Newton Energy Ltd. We also view the $100 million Eland reserve-based lending facility (RBL) due in March 2026 as ranking senior above Seplat's senior notes,” Fitch said in a press release.

Proceeds will be primarily used to redeem the company's $350 million of senior notes and repay revolver drawings without canceling the commitment after that and general corporate purposes.

“The planned notes will allow Seplat to extend its maturity profile, which will support financial flexibility over the medium term,” the agency said.

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