S&P puts Walter Energy on negative watch

Standard & Poor's said it placed the B corporate credit rating on Walter Energy Inc. on CreditWatch with negative implications.

The agency also said it lowered the rating on the existing senior secured bank facility to B+ from BB- and revised the recovery rating to 2 from 1.

The agency also said it withdrew the BB- rating on its proposed senior secured bank facilities after the company announced that it was not proceeding with the refinancing of a portion of its existing debt.

The ratings were placed on CreditWatch because the cancellation of the proposed transaction pushes out its $494 million of 2015 term loan A maturities and eliminates maintenance covenants, which could constrain the company's liquidity, S&P said.

Continued weak met coal markets could make the repayment or refinancing of the 2015 maturity less certain, the agency said.

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