Moody’s changes Delek & Avner view to negative

Moody’s Investors Service said it changed the outlook to negative from stable on Delek & Avner (Tamar Bond) Ltd. and affirmed the Baa3 senior secured ratings.

The outlook revision reflects increased uncertainty over the balance of gas supply and demand in Israel and asset values as a result of the coronavirus crisis, balanced by significant reductions in the project’s debt relative to its share of gas reserves, Moody’s said.

“The negative outlook reflects the likelihood of gas oversupply in Israel because of increasing competition from other gas fields in the region, especially the Leviathan field, as well as lower demand due to the coronavirus crisis, and the narrowing window for the sponsor to divest its interest in the Tamar lease, as required under the Israeli Gas Framework, which is likely to trigger a mandatory redemption of the notes issued by Tamar Bond unless bondholders choose to waive this right,” the agency said in a press release.

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