S&P assigns B to EP Energy notes

Standard & Poor's said it assigned its B issue-level rating and 6 recovery rating to EP Energy LLC's proposed $800 million senior unsecured notes due 2023. The 6 recovery rating indicates an expectation of negligible (0% to 10%) recovery in the event of default.

The agency expects the co-borrower of the notes to be Everest Acquisition Finance Inc.

EP Energy plans to use the proceeds to fund the repurchase or redemption of all of the existing $750 million 6 7/8% senior secured notes due 2019 and repay a portion of the borrowings under its credit facility, as well as for general corporate purposes.

S&P said the ratings continue to reflect its view of EP Energy’s "fair" business risk and "aggressive" financial risk profiles, as defined under the criteria. These assessments reflect the company's medium size and scale and its high proportion of proved undeveloped reserves.

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