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S&P downgrades Edgen Group
Standard & Poor’s said it lowered the corporate credit rating on Edgen Group Inc. to B+ from BB-.
The agency also said it lowered the rating on the company’s 8¾% senior secured notes to B+ from BB-. The recovery rating remains at 3, indicating 50% to 70% expected default recovery.
The outlook is negative.
The downgrades reflect an expectation that Edgen Group will maintain credit measures that are consistent with that of a highly leveraged financial risk profile with debt-to-EBITDA sustained at more than 5x for at least the next 12 months, S&P said.
While the market may improve in 2016 based on higher oil prices, the agency said it expects weakness for the rest of 2015, which will continue to pressure Edgen and its respective end markets.
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