Moody’s drops DCP Midstream, debt to Ba2

Moody's Investors Service said it downgraded DCP Midstream Operating LP's (DPM) corporate family rating to Ba2 from Ba1 and senior unsecured debt ratings to Ba2 from Ba1.

The changes reflect the corporate reorganization effective Jan. 1 that combined all of the assets and debt of DCP Midstream LLC (DCP Midstream) into DPM.

The ratings on DCP Midstream's debt, which was assumed by DPM as part of the reorganization, were affirmed at Ba2 for the senior unsecured notes and affirmed at B1 for the junior subordinated notes.

The agency withdrew DCP Midstream's Ba2 corporate family rating and Ba2-PD probability of default rating.

DPM’s outlook is stable.

Moody’s said the downgrade of the corporate family rating to Ba2 reflects DPM's elevated leverage immediately following the reorganization, as well as the benefits of the simplified organization structure, stable cash flows, meaningful size and scale in the U.S. gathering and processing industry and attractive business profile.

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