Fitch assigns Delek Logistics, notes BB-

Fitch Ratings said it assigned a long-term issuer default rating of BB- to Delek Logistics Partners, LP and BB-/RR4 (recovery of 31%-50%) ratings to the planned senior unsecured notes. The notes will be co-issued by Delek Logistics Finance Corp. The outlook is negative.

“The ratings reflect DKL's modest leverage, fairly stable cash flows backed by some minimum volume commitments (MVC) from its sponsor and primary counterparty, Delek US Holdings, Inc (Delek Holdings; NR) and its limited size and scale,” Fitch said in a press release.

The outlook reflects the risk that the refining sector demand profile may be challenged for an extended period. “A prolonged economic recovery or contraction may affect cash flows, impairing Delek Holdings' financial profile and its ability to support DKL,” the agency said.

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