S&P drops EquiPower loan view to negative

Standard & Poor's said it revised its outlook to negative from stable on EquiPower's $425 million first-lien term loan and $100 million revolver. The agency said it also affirmed the BB- issue rating on the term loan and revolver, as well as the 1 recovery rating.

"The outlook revision reflects an expectation of further weakening in the project's financial performance over the next 12 to 24 months, given our view of future gas basis differentials and the recently approved Connecticut Generator Tax," said S&P credit analyst Andrew Giudici in a news release.

The agency said the BB- rating on EquiPower Resources Holdings LLC's $425 million term loan and $100 million revolver reflects a volatile cash flow generation profile, exposure to commodity and operational risk, and dependence on merchant revenues to repay debt.

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