S&P rates Endeavor Energy notes B+, loan BB

Standard & Poor's said it assigned its B+ corporate credit rating to Endeavor Energy Resources LP. The outlook is stable.

At the same time, S&P assigned a B+ issue rating and a 4 recovery rating to the $300 million senior unsecured notes due 2021, indicating an expectation of average (30% to 50%) recovery in the event of a payment default. S&P noted that if Endeavor were to issue an additional $100 million or more of senior unsecured notes, then the issue rating would fall to B, reflecting the fact that the recovery on the unsecured debt would decline to modest (10% to 30%), consistent with a recovery rating of 5.

S&P also assigned a BB issue rating and a 1 recovery rating to the company's $1.4 billion secured credit facility, indicating a very high (90% to 100%) recovery.

"We believe Endeavor will be able to prudently manage its capital spending and increase reserves and production over the next two years while maintaining moderate debt leverage and substantial interest coverage," said S&P credit analyst Ben Tsocanos in a news release.

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