Moody's eyes Vine for upgrade

Moody's Investors Service said it placed Vine Energy Holdings LLC's ratings on review for upgrade, including its B3 senior unsecured notes rating and its Ba2 senior secured term loan rating.

The review follows the announcement that VEH's majority owner, Vine Energy Inc., and higher-rated Chesapeake Energy Corp. agreed that Chesapeake will acquire VEI in a transaction funded by equity and cash, the agency said. Funds managed by the Blackstone Group Inc. own about 70% of VEI’s common stock and agreed to vote for the deal.

"The potential ownership by Chesapeake is positive for Vine's creditors, given Chesapeake's stronger credit profile," said Sreedhar Kona, a Moody's vice president and senior analyst, in a press release. "Additionally, the pro forma entity is expected to generate significant free cash flow."

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